$17 million donation from Laura and John Arnold to increase access to affordable housing
Community Housing Capital (CHC) announced a $34 million fund to increase access to affordable housing for people of color. The CHC BIPOC Affordable Housing Development Fund (“BIPOC Fund”) is initially made possible by a $17 million commitment from Arnold Ventures, with another $17 million coming from CHC’s own capital. With this commitment, CHC aims to address racial inequality in the housing market across 12 southern states plus Washington, DC, and reduce the racial wealth gap.
The racial wealth gap is wide and persistent. More than 50 years after the Civil Rights movement, the typical U.S. Black and Latino families possessed $24,100 and $36,050 in wealth, respectively, while the typical white family had $189,100. Housing security and housing affordability are impediments to building wealth for Black, Indigenous, and other families of color, some of whom have been excluded from homeownership and are more likely to be renters. BIPOC families’ ability to build wealth is more likely to be harmed during economic downturns, such as the subprime mortgage crisis in 2008 which wiped out half of Black wealth, and the pandemic which widened the racial wealth gap.
The BIPOC Fund will provide capital and strategic guidance to counter the trend through debt financing and prioritizing minority-led non-profit housing developers working in communities of color. It will preserve naturally occurring affordable housing and enable the building of new units for families earning less than 80% of area median income (AMI) across 12 southern states and Washington, DC.
“Too often, executives of color are excluded from funding opportunities or receive higher rates than their white counterparts, due to bias and other systemic challenges,” said Cindy Holler, President and CEO of Community Housing Capital. “The fund will infuse capital into minority-led organizations working in communities of color that have been denied wealth-building opportunities for far too long.”
Dana Chestnut, SVP and Chief Lending Officer, said, “NeighborWorks’ organizations across the southern region are aiming to develop $2.4 billion in real estate. However, because of liquidity concerns, they only pledge 1% of that amount, whereas for market-rate housing, developers typically pledge 25% to 30%. We looked at that gap and saw an opportunity to provide early, patient, and debt capital to the communities that would most benefit from it.” The BIPOC Fund will offer pre-development loans, land loans, bridge multi-family acquisition loans, and revolving lines of credit.
Arnold Ventures has committed more than $70 million in investment to affordable housing projects since 2021. “We believe that developers of color are an essential partner in closing the affordable housing gap in America—especially in communities of color,” said Chris Hensman, Director of New Programs, Arnold Ventures.
CHC aims to continue to build the BIPOC Fund, eventually expanding its reach beyond southern states and across the U.S. in places where housing affordability remains an acute challenge for families. In addition, CHC will collect data from its borrowers annually to understand its impact and reach.
Community Housing Capital (CHC) is a 22-year-old Community Development Financial Institution (CDFI) and 501(c)(3) created to facilitate the creation and preservation of affordable housing. Since 2000, CHC has, through its lending activity, created or preserved over 21,400 units of affordable housing and facilitated $2.9 billion in total development. Community Housing Capital is headquartered in Decatur, Georgia.
Arnold Ventures is a philanthropy dedicated to tackling some of the most pressing problems in the United States. Driven by a mission to maximize opportunity and minimize injustice, it invests in sustainable change, building it from the ground up based on research, deep thinking, and a strong foundation of evidence. Arnold Ventures is headquartered in Houston, with offices in Washington, D.C., and New York City.
The Arnolds started donating to the Knowledge Is Power Program (KIPP) in 2004 with a gift of $30,000 which was then based in Houston, and two years later he and his wife pledged $10 million to help KIPP expand to other cities. Other multi-million gifts followed to other education programs, for example to Washington, D.C. city schools for merit pay, to Teach for America, and to StudentsFirst. The Arnolds had also given to The City Fund, an organization focused on growing the number of charter schools in the USA, and its political arm, Public School Allies.
The Laura and John Arnold Foundation was a private foundation founded by Arnold and his wife Laura. The organization was founded in 2010. In 2008, the Arnolds were original signatories of the Giving Pledge, a pledge by some high-net-worth individuals to donate the majority of their income to philanthropic causes during their lifetimes. From 2010-2013, the Arnolds were heavily involved in the Innocence Project which led to their interest in criminal reform. The Foundation is focused on evidence-backed giving for systematic change.
In 2013, the Arnolds donated $10 million as a private donation to the National Head Start Association after the United States federal government shutdown of 2013 had closed the pre-K Head Start programs.
In October 2018, it was reported that Arnold had spent more than $100 million in health-care related grants since 2014, with a particular focus on reducing pharmaceutical drug costs. The Arnolds fund Institute for Clinical and Economic Review (ICER), a nonprofit that created a formula to price drugs. Those who support ICER’s formula believe it could lower prices while critics argue that the formula is discriminatory toward the elderly and those with disabilities or rare diseases. Arnold also has been an influential supporter of Democrats’ efforts to pass a drug-price reform bill.
In 2019, the organization was transformed into a limited-liability company composed of the former foundation, a donor-advised fund, and the Action Now Initiative advocacy organization, effectively combining philanthropy, research, policy, and advocacy efforts. The new entity is known as Arnold Ventures LLC with the charter “to remove barriers between data and decisive action, working swiftly across the policy-change spectrum.”
In 2020, Arnold was one of ten billionaires who had given away at least 20% of their wealth.