“This was a wonderful site that is near transit in one of the hottest real estate markets on the planet,” said MidPen President Matt Franklin.
But despite the fact that there were over a dozen other offers, MidPen was able to grab the site with the help of a $14 million loan from the Community Housing Fund, a new $150 million affordable housing fund established a year ago by Facebook and two nonprofits — Partnership for the Bay’s Future and Destination: Home.
“We were able to move very, very quickly thanks to the Community Housing Fund,” Franklin said.
On Wednesday the fund announced that it had made its first investments: $40 million that will provide key funding for four developments that will create about 500 units of affordable housing.
In addition to 160 units on Sonora Court, the fund will provide $9.75 million for predevelopment of a 94-unit project in San Jose’s West San Carlos Urban Village; $5.8 million for an undisclosed building in Alameda County; and $8.3 million for development at Lighthouse at Grace, which will house 100 at-risk formerly homeless families at 155 S. 11th Street in San Jose.
The funds are administered by the Local Initiatives Support Coalition, an organization led by former San Francisco Planning Commission President Cindy Wu.
Wu said that the fund is “looking for developers committed to extremely low income populations” in the five-county Bay Area.
“Nothing has greater impact on transforming lives and breaking inter-generational cycles of poverty than housing stability,” said Wu.
There is currently $60 million to $70 million more in loans in the works, she said, adding, “We have a strong pipeline.”
The Community Housing Fund is part of Facebook’s $1 billion commitment to affordable housing, and to the Partnership for the Bay’s Future, a collaborative effort to “produce, preserve, and protect affordable homes in the Bay Area, and to ensure this region remains a diverse place where all people are welcome and can thrive.”
While affordable housing developers rely on low-income affordable tax credits and affordable housing bonds to bankroll construction, it’s much harder to borrow money for predevelopment work, which includes land acquisition, design, legal services and environmental review. That is what the Facebook fund is focused on.
The MidPen development will include 32 units for formerly homeless families and 32 units targeting very low income households. The rest will be workforce housing for low-to-moderate income families.
The fund offers “an enormously helpful financial product for groups like MidPen trying to build deeply affordable housing right in the middle of Silicon Valley,” Franklin said.
In a note to employees, Facebook CFO David Wehner put the fund ahead of its goal of funding five projects within the first year. He expects two more projects to be funded before the end of this year.
J.K. Dineen is a San Francisco Chronicle staff writer. Email: firstname.lastname@example.org Twitter: @sfjkdineen