Community Solutions announced that it has secured $135 million to close out its CS Large Cities Housing Fund to provide housing resources to individuals exiting homelessness and middle-income individuals.
The private equity fund is supported by some of the largest social impact investors in the nation, ranging from health systems to banks and private foundations.
Since launching in 2022, the fund has acquired 1,155 apartment homes in six cities that are part of the Built for Zero movement to solve homelessness and housed more than 340 individuals exiting homelessness. It aims to acquire more than 2,500 housing units.
Ultimately, half of the units in the portfolio will be reserved for individuals exiting homelessness, and half will be preserved as workforce affordable housing, according to fund officials.
“We need fresh ideas for providing and preserving the homes required to make homelessness rare and brief. The fund demonstrates the role that social impact investors can play as part of an organized housing system aimed at results,” said Rosanne Haggerty, president and CEO of Community Solutions. “These targeted investments are measurably reducing homelessness.”
The fund owns properties in Baltimore; Charlotte, North Carolina; Denver; Jacksonville, Florida; Nashville, Tennessee; and Phoenix. Additional cities are expected to join the list in the future. In general, the fund is focusing on major metro areas that are part of the Buit for Zero initiative and making progress in reducing homelessness but facing particularly tight housing conditions, according to officials.
The fund is backed by a wide range of investors, including Kaiser Permanente, UnitedHealth Group, The Leon Levine Foundation, Truist, Ford Foundation, Wells Fargo, IWP Family Office, The Frances and Benjamin Benenson Foundation, and Woodforest National Bank, as well as a John D. and Catherine T. MacArthur Foundation grant awarded to Community Solutions.
The Large Cities Housing Fund’s innovative model makes its apartments available directly to local homeless response teams. In most cases, people experiencing homelessness can move in within 90 days after the fund acquires a property, rather than waiting years for developers to create new housing.
“This fund will fundamentally change how cities address homelessness and the affordable housing crisis,” said Dave Foster, president of BDP Impact Real Estate, a partner of Community Solutions that manages the fund and its properties. “By leveraging private capital, this model will diversify how affordable housing is developed, which will be quicker and more efficient than traditional financing mechanisms.”
Unlike many other funds, the Community Solutions model is designed to create permanently affordable housing. Once investors’ capital is returned, the properties will transition to nonprofit ownership to ensure they continue to serve the mission of addressing homelessness and preserving affordable housing, note fund officials.
In addition, the fund has raised more than $30 million from several groups that have made or pledged targeted investments in specific communities, including Amazon Housing Equity Fund, Northern Trust, Trinity Health, Alliance Healthcare Foundation, BQuest Foundation, Baltimore Community Foundation, Community Foundation for Northeast Florida, The Home Depot Foundation, and The Harry and Jeanette Weinberg Foundation.
