A first-of-its-kind $100 million investment fund to expand access to health care and affordable housing for low-income residents is being launched by Morgan Stanley, The Kresge Foundation, and the Local Initiatives Support Corp. (LISC).
The Healthy Futures Fund is being seeded with capital to build 500 housing units with integrated health serves and to construct eight federally qualified health centers that will serve an estimated 75,000 people. It is designed to spur collaboration between health-care providers and housing developers who do not often work together even when they operate in the same low-income neighborhoods and serve the same people.
“Connections between health and housing for low-income people need to be intentional. We can’t rely on serendipity to make this happen,” said Michael Rubinger, president and CEO of LISC, a nonprofit that helps revive neighborhoods across the country, in a statement.
The fund is utilizing federal low-income housing tax credits, federal New Markets Tax Credits, grants, loans, and guarantees to raise capital. Morgan Stanley is investing $63 million in equity through the housing and New Markets tax credits. The Kresge Foundation, LISC, and Morgan Stanley are providing another $37 million in loan and grant capital for the projects.
The initial investments will fund projects that are expected to create 2,200 jobs in hard-hit communities.
LISC’s affiliate, New Markets Support Co., is managing the fund as part of its Building Sustainable Communities strategy to improve the quality of life in struggling, low-income neighborhoods. Both The Kresge Foundation and Morgan Stanley are long-time LISC partners, working together for many years to revitalize impoverished areas.
The fund expects to expand in the coming months with additional New Markets Tax Credits and lending capital from new partners. Organizations already signed on include National Development Council, NCB Capital Impact, Capital Link, Primary Care Development Corp., Mercy Loan Fund, and Opportunity Finance Network.
Fund officials said the new effort is in part response to the Patient Protection and Affordable Care Act, and the 20 million new health-care consumers that the legislation is likely to create.