PR Newswire
NEW YORK, Feb. 29, 2024
Community Development Banking Helps Clients, Communities Thrive Despite Challenging Economic Environment
NEW YORK, Feb. 29, 2024 /PRNewswire/ -- Bank of America Community Development Banking (CDB) today announced that it provided $7.1 billion in debt and equity financing last year to help build strong communities through affordable housing and economic opportunities across the United States. This financing helped create and preserve 11,000 housing units for individuals, families, seniors, veterans, the formerly homeless and those with special needs.
According to a 2023 report by the Joint Center for Housing Studies at Harvard University, "millions of households are now priced out of homeownership, grappling with housing cost burdens, or lacking shelter altogether."
"The need for affordable housing continues to grow. However, affordable housing developers face the same macroeconomic headwinds challenging other industries – higher interest rates, inflation and supply chain issues," said Maria Barry, Community Development Banking national executive at Bank of America. "This requires our team to be creative, plan for all scenarios and advise our clients on how to mitigate risk and maximize results."
Three factors that help drive the creation of affordable housing, include:
1) Strong partnerships – Whether they do business locally or nationally, affordable housing developers are dealing with rising costs due to interest rate fluctuations, supply chain interruptions and rising construction and insurance costs. Our banking team helps clients work through these challenges and maximize the value of their businesses. CDB provides financing, treasury and advisory services to optimize their companies, so developers can focus on their mission of creating much-needed affordable housing.
"Despite volatile financial markets, the one capital partner that we can always rely on for their stability, leading financial offerings and unmatched capacity is Bank of America," said Gilbert Winn, Chief Executive Officer of WinnCompanies. "Without question there have been certain complex and high impact community housing developments that would not have happened without the bank's financial partnership and unique strength. Our national affordable and mixed-income housing business is fortunate to be able to make Bank of America our first call whenever we plan to pursue community development."
2) Focus on families & attainable housing – CDB explores innovative solutions to expand its impact in communities. In 2023, it worked with Enterprise Community Partners to launch a workforce housing fund. This $150 million fund will preserve 3,000+ housing units for the "missing middle," or those earning between 80% to 120% area median income (AMI). These households earn too much to qualify for affordable housing and too little to keep up with rents. The fund has already closed two deals in metro Washington, D.C., and Miami, preserving rental affordability for nearly 500 individuals and families.
"When a good home remains out of reach for millions of families, preservation is an essential component to tackling our nation's housing crisis," said Lori Chatman, President, Capital, Enterprise Community Partners. "Equally critical is working with a dedicated partner like Bank of America Community Development Banking which brings commitment and know-how along with an unparalleled network of national partnerships. Together through the Middle-Income Housing Preservation Fund, we are investing equity capital to help mission-aligned housing providers prevent displacement while keeping good homes affordable for the long term."
3) Supportive services & healthcare access – CDB has a strong focus on developments that incorporate resident services, including access to financial education, and overall health and well-being through programs such as: academic support, jobs readiness, training programs, family programs, food education, access to healthy food, and other critical supportive services. In 2023, CDB financed 4,500 housing units that incorporated a health component. Though partnerships with hospitals or health service providers, these developments incorporated on-site care dedicated to health and wellness.
"Mercy Housing recognizes the link between stable housing and good health and understands that you can't have one without the other," said Ismael Guerrero, President & CEO of Mercy Housing. "By prioritizing the need for stable and affordable housing with onsite resident services, we are elevating the health outcomes and quality of life for every resident."
CDB is active in all 50 states. Since 2005, it has financed over 287,000 total housing units of which 247,000 are affordable.
Harnessing the strength and reach of Bank of America, our banking and markets businesses provided an additional $500 million in financing to support multi-family affordable housing. The bank also continued to support affordable and sustainable homeownership through its $15 billion Community Homeownership Commitment.
These efforts are part of the company's commitment to deploying capital to address global issues outlined in the United Nations Sustainable Development Goals (SDGs).
Bank of America
Bank of America is one of the world's leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 69 million consumer and small business clients with approximately 3,800 retail financial centers, approximately 15,000 ATMs (automated teller machines) and award-winning digital banking with approximately 57 million verified digital users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 4 million small business households through a suite of innovative, easy-to-use online products and services. The company serves clients through operations across the United States, its territories and more than 35 countries. Bank of America Corporation stock is listed on the New York Stock Exchange (NYSE: BAC).
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Reporters may contact:
Anu Ahluwalia, Bank of America
Phone: 1.646.855.3375
[email protected]
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SOURCE Bank of America Corporation
