Impact Pool

The Impact Pool provides mezzanine/second trust financing, coordinates placement of qualified 501 (c)(3) bonds and measures and reports impact outcomes.

01.

The Impact Pool allows WHC to acquire mixed-income residential properties at the speed of traditional market transactions.

02.

The Impact Pool reduces the cost of capital.

03.

With clearly defined loan terms and exits, the Impact Pool allows a property to remain in the hands of a community-serving nonprofit like WHC to preserve affordable homes for the long-term.

The Impact Pool allows each philanthropic dollar to be leveraged to acquire more units and open the door to greater opportunity.

Impact Pool Benefits

Projects funded with Impact Pool capital commit to:

01.

Accept 15-year affordability covenants.

02.

At least 50% of the units reserved for families earning 80 percent of AMI.

03.

Support critical neighborhood resident services.

04.

Re-invest a portion of the profits in affordability and impact.

05.

Measure and track social and environmental outcomes.

Typical Deal Structure

• The Impact Pool provides up to 20% of project costs.
• WHC provides anywhere between 5-10% equity of the total project costs.
• The remainder of the capital is sourced from a traditional first mortgage to cover approximately 70% of the total project costs.
• WHC intends to acquire a first mortgage financing facility through a lender such as Fannie Mae and Freddie Mac so that it can quickly and efficiently acquire properties.

Long-Term
Sustainability

WHC was created to be self-sustaining entity within five years. As the non-profit owner of the real estate, the properties will generate modest revenue that will fund some of WHC’s operations. In addition, WHC will receive any investment earnings in excess of the Impact Pool’s maximum total return.

Over 40 years, each dollar contributed to WHC generates between $20 and $40 of impact that tWHC can use for rent subsidies, funding for neighborhood services, and acquiring additional buildings. WHC will be positioned to leverage $30 million in initial contributions into rent subsidies, funding for neighborhood services, and acquiring additional buildings.

Donations with
Impact

Through the Washington Housing Conservancy’s unique model, $9 of private capital can be leveraged for every $1 of philanthropic capital. In addition, services and rent subsidies are funded from property income without the need for additional donations. As the chart indicates, if market rent growth accelerates, the impact per dollar grows substantially.