OCFC Awarded $5.3 million in CDFI Funding
(Ohio Capital Finance Corporation Receives $5.3 Million in Awards from the U.S. Department of Treasury’s Community Development Financial Institutions (CDFI) Fund!)
The U.S. Department of Treasury’s Community Development Financial Institutions (CDFI) Fund announced that OCFC was awarded $4,800,000 from the Capital Magnet Fund and $500,000 from the CDFI Fund’s FA program. The awards will assist in leveraging private capital for lending to affordable housing throughout Ohio and Kentucky.
The CMF program is funded through allocations made from the Government-Sponsored Enterprises Fannie Mae and Freddie Mac. In its second funding round since 2010, 125 applications were received and only 32 were awarded. OCFC is the only Ohio based awardee. The Capital Magnet Fund helps low-income families and economically distressed communities by attracting investment for affordable housing and related economic development.
“OCFC is honored to receive its second award of Capital Magnet Funds from the CDFI Fund,” said Jon Welty, President of Ohio Capital Finance Corporation. “This award creates an exciting opportunity for OCFC to provide and leverage additional dollars for affordable housing in Ohio and Kentucky.”
OCFC expects to leverage the $4.8M CMF award over 5 years into $185 million in total project cost financing of affordable rental housing by providing below-market rate construction and equity bridge loans to Low Income Housing Tax Credit projects by increasing project equity and reducing debt as well as interest expense, allowing for lower tenant rents, which are needed in underserved markets.
The CDFI Fund received 457 applications for its 2016 FA and TA program and only awarded 34% of the applicants. The $500,000 FA award will provide OCFC with capital to launch several new products including a new HUD Equity Bridge Loan specifically designated for HUD-assisted projects that utilize HUD 221(d)(4) or 223(f) FHA mortgage products and a neighborhood improvement loan designed for historic and small commercial developments.
OCFC intends to leverage both awards with $25M of private capital to establish two new loan funds to create financing tools that are not available in the market. These funds with allow OCFC to merge and leverage private capital with public funding to reduce construction interest costs while increasing equity for projects resulting in more affordable units and furthering community development activities in the underserved markets of Ohio and Kentucky.
For institutions interested in a being part of these new loan funds, please contact Jon Welty (firstname.lastname@example.org) for additional information. Look for Information regarding the OCFC’s newest loan products and how to apply in the coming months.