NEW YORK--(BUSINESS WIRE)--Today, Citi Community Development and Grounded Solutions Network announced the launch of the Citi/Grounded Solutions Network Community Land Trust (CLT) Accelerator, an initiative to address the affordable housing challenges facing urban, rural and suburban communities nationwide by propelling the growth of community land trusts. Commemorating the 50th anniversary of the Fair Housing Act, and with a $1 million investment from Citi Community Development, Grounded Solutions Network will drive a major new effort to scale up the CLT sector and increase access to permanently affordable homeownership opportunities for first-time homebuyers living on lower incomes.
A community land trust is a nonprofit organization that retains ownership of land and sells housing on the land to lower-income households. To ensure that future owners benefit from the arrangement for years to come, the organization caps the resale prices of the housing. The unique ownership structure maintains affordability and insulates the CLT from changes to the local housing market. There are currently more than 225 CLTs in the U.S. that own around 25,000 rental units and 12,000 homeownership units.
Grounded Solutions Network will leverage the Accelerator to expand its technical assistance to CLTs across the United States and develop a suite of new tools and resources designed to help local governments, community groups and residents establish, cultivate and grow new CLTs.
“For many first-time homebuyers, the realization of homeownership is increasingly elusive. According to the Census Bureau, homeownership rates among households living on lower incomes stands at 50.2 percent, significantly lower than the national rate of 64.2 percent,” said Bob Annibale, Global Director of Citi Community Development and Inclusive Finance. “Together with Grounded Solutions Network, we aim to work with municipalities, community development organizations and residents to accelerate the growth of CLTs across the U.S. By ensuring CLTs have the access to the expertise and capital they need to grow, we will help enable low-income first-time buyers to fulfill their dreams of homeownership, both now and for generations to come.”
The initiative will also include the establishment of a $500,000 CLT Accelerator Fund. Administered by Grounded Solutions Network, the Fund will provide capital grants to existing high-capacity CLTs to quickly convert real estate opportunities into units on the ground. Through the program, the initial grant investment may be recycled, creating additional impact beyond the first round of homes created.
“Many communities have expressed interest in the community land trust model as an important tool for addressing the housing crisis,” said Tony Pickett, CEO of Grounded Solutions Network. “Recent research suggests that CLTs may function as an appropriate tool for stabilizing neighborhoods at risk of gentrification while preserving affordability and preventing the displacement of existing residents. Moreover, CLTs can offer communities of color an opportunity to close the racial wealth gap by providing a secure way to own a home, with a fraction of the foreclosures experienced during the housing crisis. The CLT Accelerator will help Grounded Solutions lift up, replicate and support the community land trust model across the country.”
Since 2014, Citi Community Development has invested $4.7 million in capacity building and seed funding to establish CLTs in Long Island, NY, Washington, DC, and Miami, FL. Most recently, Citi Community Development announced the creation of the Interboro CLT, New York City’s first citywide community land trust with a primary focus on creating permanently affordable homeownership opportunities for low-income households in one of the most expensive cities in the country.
Findings from the 2017 Menino Survey of Mayors showed that housing availability and affordability is the most pressing concern for city leaders and the top reason that people are moving away from their cities. One third of mayors stated that increasing homeownership rates is a top priority for their administration. Yet homeownership continues to be out of reach for many residents. Research conducted by New York University’s Furman Center found that in New York City, while roughly half of the city’s households (51%) earn $55,000 or less annually, they could afford just 9% of home sales. In February, the California Association of Realtors Housing Affordability Index found that just 13% of San Francisco County residents make enough to afford a median-priced home in the area.
Last year, with the support of Citi Community Development, the South Florida Community Land Trust (SFCLT) launched the first equity fund for community land trusts in the country, with the aim to compete in a high-cost, cash-driven market by providing a source of cash to acquire property. Rather than use the funds for a one-time investment in a single project, the dollars are intended to be leveraged and revolved into future projects. The prior $500,000 investment from Citi Community Development is expected to leverage more than $15 million in construction dollars to create sustainable, permanently affordable units in Miami-Dade County - one of the least affordable markets in the country. SFCLT has plans to expand the fund to Broward County in 2018 and is excited that Grounded Solutions is replicating the model.
“South Florida is one of the largest markets, with the greatest needs and the least resources, so we need solutions that keep housing affordable,” says Mandy Bartle, Executive Director of South Florida Community Land Trust. “That is why we are excited to be working with Grounded Solutions and Citi Community Development to accelerate the growth of CLTs.”
“The relationship between Citi Community Development and Grounded Solutions Network will heighten awareness of the role CLTs play in providing affordable and sustainable homeownership for lower income households,” said Maria Benjamin, Board member of Grounded Solutions Network and Director of Homeownership and Below Market Rate Housing in the San Francisco Mayor’s Office of Housing and Community Development. “Grounded Solutions appreciates the leadership of Citi Community Development in advancing CLTs as a critical tool to prevent displacement, especially in high cost real estate markets like the Bay Area.”
“Community land trusts ensure that homes are made affordable and stay affordable for generations to come,” says Peter J. Elkowitz, President/CEO of Long Island Housing Partnership and Board member of Grounded Solutions Network. “CLT homeowners have extremely low foreclosure rates making it an avenue for lower income households to build wealth for their families and stability for neighborhoods.”
“Community land trusts offer a critical tool to provide affordable housing on a sustainable basis, particularly in neighborhoods and communities vulnerable to displacement,” said Mark Kaufman, President of City First Enterprises. “We appreciate the partnership and support of Citi Community Development and Grounded Solutions to supporting this important work in Washington, DC and nationwide."
To learn more about the Citi/Grounded Solutions Network Accelerator and to apply to the CLT Accelerator Fund, visit https://groundedsolutions.org/clt-accelerator-program/.
About Grounded Solutions Network
Grounded Solutions Network supports strong communities from the ground up. We connect national and local expertise; bringing together the networks, knowledge and support needed to build inclusive communities. We promote housing solutions that will stay affordable for generations so communities can stabilize and strengthen their foundation, for good. Backed by our members, Grounded Solutions Network champions evidence-based policies and strategies that work. We help our members, partners and elected officials use them to establish inclusive communities that have diverse housing options for a variety of incomes, offering choice and opportunity for all residents – both today and for future generations.
About Citi Community Development
Citi Community Development leads Citi’s commitment to financial inclusion and economic empowerment for underserved individuals, families and communities across the U.S. Through innovative collaborations with municipalities, community groups and leading nonprofit organizations, we harness the institution’s expertise, products and services to help expand opportunity for all.
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