Fund – Capital Magnet Fund

  • Older adult patient poses with doctor
  • CAPITAL MAGNET FUND

Attracting private capital to support affordable housing

A program of the U.S. Department of the Treasury CDFI Fund, the Capital Magnet Fund is designed to help mission-driven lenders attract private capital to support large scale loans in communities where financing is most needed.

In particular, loans utilizing the Capital Magnet Fund focus on providing financing for the development, rehabilitation, preservation, and purchase of affordable housing. In addition, this Fund can be used to create loans for other community service facilities as a means to create jobs and help stabilize and/or revitalize neighborhoods long impacted by disinvestment.

Capital Impact is focusing its efforts using this Fund to form key partnerships with developers that support the preservation and expansion of multi-family or mixed-use projects across Wayne County and Metro Detroit. This effort is anchored with a commitment to meet the demand for quality affordable housing.

Still struggling since the great recession, Wayne County’s nearly 688,000 households have a median household income of $46,390. Detroit, the largest city in Wayne County, is much lower with a median household income of $31,283 and a poverty rate of 36.4%.

Overcoming the historic underinvestment this region has faced requires a larger inclusive growth strategy. With the Capital Magnet Fund, Capital Impact is supporting locally driven solutions to develop mixed-income neighborhoods with easy access to employment and critical social services that contribute to the vibrancy and economic growth of the city.

Key Fund Features:

  • Support multi-family rental housing and mixed-use real estate developments in Wayne County, Michigan with the following parameters:
    • At least 20% of the residential units offered below 50% of the Area Median Income (AMI);
    • At least 50% of the residential units offered below 80% of the AMI;
    • And all of the residential units offered below 120% of the AMI.
  • Pre-development, acquisition, construction, and/or permanent loans
  • Loan amounts up to $8 million
  • Up to 90% Loan-to-Value
  • Loan terms between 2 and 12 years
  • Amortization schedule up to 35 years
  • Equity requirement as low as 10% of project costs

Advantages of Borrowing Through Capital Impact Partners:

With an office and dedicated team in Detroit, we have invested more than $250 million locally to support inclusive growth in the city. Since 2015, Capital Impact has:

  • Invested in projects that renovated or constructed over 2,800,000 sq. ft.
  • Contributed to the creation of over 900 permanent jobs and over 3,400 construction jobs
  • Invested in the construction/preservation of over 1,700 housing units
  • Helped to create new quality housing for nearly 4,000 people

Financing Projects that Support Inclusive Growth

Sample Capital Magnet Fund Loans

Project

Loan Amount

Impact

Leland House

Detroit, MI

$1.5 Million predevelopment loan

Gut rehab of a former hotel into a large mixed-use development with 339 residential units, including 70 units below 50% of the AMI

Coogan Terrace

Melvindale, MI

$1.2 Million LIHTC permanent loan

RAD conversion of a 199-unit senior living development, including 99 units below 60% of the AMI and 100 units below 50% of the AMI

Parker Durand

Detroit, MI

$14 Million construction / mini-perm loan

Ground-up construction of a mixed-use development with 92 residential units, including 27 units below 80% of the AMI and 19 units below 50% of the AMI

Kercheval East

Detroit, MI

$2.98 Million

construction / 

mini-perm loan

Gut rehab of a former liquor store into a mixed-use development with 16 residential units, including 5 units below 80% of the AMI and 3 units below 50% of the AMI

Holbrook

Detroit, MI

$8.25 Million

construction /

mini-perm loan

Gut rehab of two underutilized buildings into a multifamily development, including 110 units below 80% of the AMI and 28 units below 50% of the AMI.

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Questions About the Fund?

Nicholas Pohl
Business Development, Great Lakes
npohl@capitalimpact.org
(313) 230-1255
Detroit, MI

Capital Impact Partners has been a key partner of the Roxbury Group in developing its residential portfolio. From offering critical senior debt facilities in the wake of the Great Recession, to creating incentivized loan structures to make historic rehabilitation and affordability objectives possible, CIP provides innovative solutions to deliver much-needed housing to urban areas.

James Van Dyke
Executive Vice President
Roxbury Group

STORIES OF IMPACT

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When Richard Hosey returned to his hometown in 2008, the economic downtown had completely changed the city he remembered. Now the Detroit native has focused his efforts to returning the city to its former greatness.

Richard Shares The Ups and Downs of Development in Detroit

Project Spotlight: Casamira Apartments

Though it was vacant with fire damage, Lisa Johanon saw potential in the 1925 building, “It was a great neighborhood before the decline of Detroit. We need to be honoring that.” The result created much needed affordable housing for the community.

Watch the Story of Transformation

Program Spotlight: Stay Midtown

As a rapidly developing Midtown threatened the housing supply for long-term Detroiters, we stepped in with Midtown Detroit, Inc. to launch Stay Midtown. Was the effort successful? This evaluation looks at the results.

How Stay Midtown is stabilizing housing

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