This is one of several clusters of new homes built in Cleveland’s Hough neighborhood near League Park to address a shortage of quality housing. This was the result of work by the Famicos Foundation, Ohio Housing Finance Agency and others. More homes are planned through the city’s new Housing Investment Fund. Called the Henrietta Homes, this cluster is located at East 65th Street and Linwood Avenue. Others are on Lawnview Avenue, Pennsylvania Avenue and Zoeter Avenue (Famicos Foundation). CLICK IMAGES TO ENLARGE THEM.
Goal is to raise $100M, add 3,000 housing units
Cleveland Mayor Justin Bibb, Cleveland City Council and the Cleveland office of Local Initiatives Support Corporation (LISC Cleveland) announced details today of a major new initiative to address the affordable housing crisis facing Cleveland residents.
The Cleveland Housing Investment Fund (CHIF) was made possible by a transformative $18 million grant commitment from the City of Cleveland (the City) and a $20 million investment from KeyBank. It aims to raise up to $100 million from mission-aligned partners to finance much-needed capital for affordable housing developments across the city.
The goal is to create between 2,500 and 3,000 affordable units, including a minimum of 100 units of for-sale housing, according to a statement issued today to NEOtrans.
Urgency drives this initiative in Greater Cleveland, where rents are rising at the fastest rate in the United States. According to a recent report by Redfin, Cleveland saw the biggest year-over-year rent increase by percentage of the 50 most-populated metro areas in the country, with average rents up 10.6 percent in 2024.
Increasing demand has created an urgent need for more affordable housing for low-income, working-class and middle-class residents. The significant commitments from the City and KeyBank aim to address this housing burden by creating financing options that will help create and preserve inclusive, affordable housing for Clevelanders.
New infill homes in Cleveland not only provide quality homes to families in need, they also help stabilize troubled neighborhoods and keep gentrifying neighborhood affordable so longtime residents can afford to stay in the communities they’ve lived in and loved (Google).
This public-private partnership seeks to leverage $100 million in capital to support resilient neighborhoods and stimulate economic growth. Greater Cleveland also has one of the tightest housing markets in the country.
By maximizing the City’s funding and attracting private capital, CHIF —managed by LISC Fund Management, LLC (LFM), an affiliate of LISC —will invest in flexible term debt primarily for mixed-income rental housing preservation and new construction, as well as for sale affordable homes.
The focus will be on middle market and opportunity neighborhoods, anchoring resilient communities and driving growth. Projects outside these neighborhoods, but with deep affordability and impact, will also be considered.
“By creating the Cleveland Housing Investment Fund, we are not just addressing a pressing need; we are investing in the future of our neighborhoods,” said Mayor Bibb in a written statement.
“We are grateful for the support from KeyBank and excited to partner with LISC, which has a great track record in the creation of innovative programs that lead to successful affordable housing projects,” he added. “Together, we will increase access to affordable housing for Clevelanders, regenerating vibrancy and quality of life throughout the city.”
Houses for sale in Greater Cleveland have been harder to find for a while, but that tightness in the market has become notable on a national scale, pushing Greater Cleveland to near the top in real estate rankings that show it truly is a seller’s market (Google).
How CHIF works
CHIF will focus on providing financing to construct housing that is affordable for residents with low to moderate incomes, particularly those earning less than 80 percent of the area’s median income. As of December 2024, this translates to individuals earning $54,450 or less annually.
CHIF will invest in a variety of affordable housing developments, including neighborhood-scale rehabilitation projects, as well as the new construction of rental housing and for-sale homes, with an average loan or investment of $1 million to $5 million per project. This initiative will bolster existing city resources for affordable housing and help fill much needed capital.
Additionally, the fund aims to support emerging developers and community-based enterprises that face challenges accessing capital. These developers will receive guidance and technical assistance to make sure they are well positioned to potentially secure funding from CHIF.
Designed to increase the impact and leverage of public dollars, CHIF aims to deliver gap financing with a higher return on investment. Typically, for every $12.50 invested, there is a $100 impact. CHIF is projected to increase this impact, where for every $6 invested, there is a projected $100 impact.
“At KeyBank, we believe that everyone deserves the opportunity to thrive in a community that supports their aspirations,” said Brian Maddox, National Team Leader for KeyBank CDFI Lending and Investment.
“Our $20 million investment in the Cleveland Housing Investment Fund underscores our commitment to affordable housing solutions that effect meaningful change in the lives of Cleveland residents,” he continued. “CHIF is an innovative program we believe will bring robust development that will positively impact neighborhoods across Cleveland.”
New construction, for-sale housing is difficult to find because it is difficult to finance and get built. The city’s new housing fund seeks to address that financing gap. These are homes that have been planned in Cleveland’s Glenville (Arkitainer).
Accountability and Transparency
Representatives from LISC will meet monthly with administrative and council representatives to ensure CHIF is satisfying desired community benefits and outreach commitments. This collaborative approach will ensure that CHIF effectively addresses the needs of Cleveland residents while promoting transparency and accountability.
“City Council hears from residents every day about the need for affordable housing and additional investment in our neighborhoods, particularly in under-resourced areas,” said City Council President Blaine Griffin. “We are proud to support CHIF, and we look forward to playing a role in this important work.”
As Cleveland continues to face challenges in affordable housing, the establishment of Cleveland Housing Investment Fund represents a proactive and strategic approach to creating development opportunities for all residents. LISC Cleveland will host an informational session for developers interested in learning about new funding options that CHIF will provide on April 10, 2025.
“LISC and LFMs have had great success with establishing and managing similar funds in cities like Dallas, Charlotte and Detroit,” said Kandis Williams, executive director of LISC Cleveland. “With CHIF, we have taken a lot from those programs but tailored them to meet Cleveland’s unique challenges and build upon existing community assets.”
“This initiative will provide access to flexible capital, which is sorely needed to support construction and attract projects to neighborhoods that otherwise would be overlooked,” Williams explained. “We are already talking to developers about this new opportunity and look forward to seeing new projects breaking ground soon.”
END
