COLUMBIA, MD, TULSA, OK and RICHMOND, VA – Enterprise Community Partners (Enterprise) announced a $20 million commitment from Charles and Lynn Schusterman Family Philanthropies (Schusterman), along with $5 million from the Community Investment Guarantee Pool (CIGP), toward Equitable Path Forward, Enterprise’s five-year, $3.5 billion nationwide initiative to invest in Black, Indigenous, and People of Color (BIPOC) and other historically marginalized housing providers.
CIGP’s $5 million second-loss guarantee support and $10 million in third-loss support from Schusterman will back a first-of-its kind Standby Guaranty Facility, a credit enhancement tool that helps unlock access to capital for BIPOC developers whose balance sheets do not meet traditional investor requirements. It is part of Enterprise’s work to push the community development finance system to make intentional changes to their risk models to level the playing field for developers of color. The Standby Guaranty Facility will eliminate the need for developers to secure a third-party co-guarantor, which can reduce their profit potential and further perpetuate barriers to BIPOC developers’ business growth. The flexibility of the Standby Guaranty Facility enables Enterprise to provide guarantees at the developer, project, or fund level.
The remaining $10 million from Schusterman will provide growth capital and advisory services designed to support BIPOC developers as they grow their operations and real estate portfolios and create impact in their communities.
“For centuries, Black entrepreneurs have lacked access to the capital we all need to be able to start and build businesses, and even when that capital was available, it was frequently overpriced. We are pleased to support Enterprise Community Partners’ national effort to provide financing to developers of color so they can build their businesses while creating more affordable housing for the many families in need,” said Stacy Schusterman, chair, Charles and Lynn Schusterman Family Philanthropies. “We believe that through efforts to develop new community development finance models, all developers can be afforded equitable access to capital and the nation’s supply of affordable housing can expand in the process.”
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