Most housing developers identify pre-development financing as critical to creating workforce housing – but it is rarely commercially available.
Since middle income earners make too much to qualify for traditional housing subsidies, but not enough to pay market rate rents and mortgages, there is a “gap” in workforce housing development budgets. Financiers, as a result, rarely commit to housing targeted for middle income earners, especially for predevelopment costs at the riskiest stage of the development process. On top of that, newer technologies, building materials, and assembly methods that might help close that financing gap represent even more risk, making the likelihood of securing predevelopment financing close to zero.
In partnership with the Strategic Economic Development Corporation (SEDCOR), and the Newberg Workforce Housing Consortium (NWHC), the Missing Middle Housing Fund has launched a revolving investment fund to finance predevelopment costs for workforce housing developments that serve Newberg-based employers. Representative Anna Scharf helped secure $3M dollars from the State of Oregon to support the work of the NWHC, and the bulk of those dollars will now serve as the seed funding for projects chosen through a competitive process.
SEDCOR recently transferred these dollars to the MMHF, and efforts are underway to build out the committees to guide these investments to projects that reduce the time and cost to create much needed workforce housing. If you or someone you know would be a good fit on a governance committee, please let us know at info@missingmiddlehousing.fund. We are looking for volunteers with experience in lending, equity investments, real estate development, and housing innovation.
Over the next few months, we will provide updates as the fund gets up and running. Already, the promise of this fund has attracted innovators to Newberg, brought Newberg’s largest employers together for a common cause, and has served as an inspiration for other communities across Oregon and beyond. Stay tuned!