Affordable Housing Leverage Fund
The Affordable Housing Leverage Fund (AHLF) is a partnership between Detroit LISC, the City of Detroit Housing & Revitalization Department (HRD), and the Michigan State Housing Development Authority (MSHDA) to provide affordable housing developers and owners with streamlined access to financial tools that are specifically designed to address housing challenges in Detroit neighborhoods.
AHLF encourages the preservation of regulated and naturally occurring affordable housing throughout the City of Detroit and the development of new mixed-income and affordable housing in targeted multi-family housing areas. AHLF is expected to deploy $250 million into the preservation of 10,000 units of existing affordable housing and the development of 2,000 units of new affordable housing.
AHLF will primarily finance affordable multi-family rental housing; however for-sale and single family projects will be considered. AHLF will invest in housing that is affordable to households at or below 60% Area Median Income (with consideration of households up to 80% AMI for for-sale projects). Recognizing that housing cost burdens are a particularly acute challenge for Detroit residents at the lower end of the income spectrum, AHLF will seek to invest in a significant number of homes that are available to households below 50% and 30% of AMI as well as permanent supportive housing.
How the Fund Works
AHLF is an umbrella for three coordinated funds that are deployed together through a common application and review process. Detroit LISC manages the application and preliminary underwriting processes on behalf of the AHLF partnership and will manage the award and underwriting of low-interest loans, philanthropically-backed soft debt, and capital needs assessment grants ($125 million). The City of Detroit will manage the award and underwriting of Federal and local sources of soft debt ($50 million), and MSHDA will manage the award and underwriting of low-interest tax-exempt bond loans and gap financing ($75 million).
AHLF will include a variety of product types including:
- Soft/Gap Financing (public & private)
- Capital Needs Assessment Grants
- Acquisition/Mini-Permanent Loans (Low Interest)
- Mezzanine Loans (Low Interest)
- Naturally Occurring Affordable Housing Permanent Loans (Low Interest)
- Tax-Exempt Bond Loans (Low Interest)