Housing Impact Fund Closes Largest Capital Raise To Preserve One Thousand Five Hundred Affordable Apartments In Charlotte
Housing Impact Fund has closed its largest capital raise to date, securing more than $100 million in private-sector equity for Fund III to acquire, renovate and preserve 1,500 apartment units in the Charlotte market. The fund’s strategy targets Naturally Occurring Affordable Housing, or NOAH, preserving existing apartment communities that serve low- and moderate-income households and are at risk of being redeveloped into higher-cost housing.
Since 2020 HIF has acquired nearly 2,000 apartments located near jobs, transit, schools and services. All acquired communities undergo renovation and are subject to 20-year deed restrictions that lock in affordability. Under those restrictions 30% of units at each community are reserved for households earning less than 30% of area median income (AMI), 50% for households under 60% AMI, and 20% for households under 80% AMI.
“The completion of our third round of fundraising is testimony that Housing Impact Fund’s unique model is benefiting everyone involved, including residents, investors and the broader Charlotte community,” said Erskine Bowles, the former White House chief of staff and investment banker who co-founded the fund with his Carousel Capital co-founder, Nelson Schwab. “By keeping these properties from being redeveloped into housing that prices many people out of the market, we’re providing opportunities for economic and social advancement while maintaining the city’s diverse and vibrant core.”
HIF’s Fund III follows prior raises of $58 million in 2020 and $67 million in 2023. Together those equity commitments total roughly $225 million, which the fund estimates produces about $750 million in purchasing power through a mix of equity, low-interest public loans, philanthropic support and below-market mortgage financing from agencies such as Freddie Mac and Fannie Mae.
“The vision of our Fund III investors and the continued commitment of our civic and community partners will allow us to provide even more access and opportunity to people who are often left behind by the growth and prosperity Charlotte is enjoying,” said Schwab. “In addition, by investing $26 million to renovate our 11 properties, more than 90% of which was contracted with minority-led companies, we’re providing affordable, high-quality places to live and raise a family.”
The fund also integrates operating supports and partnerships. Mecklenburg County and the City of Charlotte have enabled 100% of property tax revenues from the fund’s communities to be reinvested as rental subsidies for qualifying households at or below 30% AMI. To date 560 apartments have been reserved for those households; average reported rent for those units is $336 on average monthly household income of $1,157. Atrium Health provides onsite Community Impact Workers and partners supply services spanning financial capability, workforce development, education and health.
“Housing Impact Fund has been a powerful vehicle for social-impact investors to make headway in solving one of Charlotte’s greatest challenges – safe, affordable, quality housing that allows everyone to participate in the region’s economic success,” said Mark Ethridge, managing principal of Ascent Housing, which co-founded Housing Impact Fund and serves as its operating partner, responsible for leading the acquisition, financing, closing, renovation, and operation of its properties. “We’re grateful for the support of Truist Bank, Atrium Health and more than 50 other organizations and individuals who are helping us provide stability and upward mobility for thousands of Charlotteans.”
Fund governance expands with three new pro bono fund managers. Key contributors to Fund III include Truist Bank, PNC, First Horizon, Bank of America, Atrium Health, First Citizens, Regions, Honeywell, Leon Levine Foundation, Huntington National Bank and The Duke Endowment. The model underscores a blended capital approach and on-site services as a means to preserve affordability and neighborhood access amid rising rents.