CHELSEA, Mass. – In an effort to combat a rising tide of foreclosures, Mass. Gov. Deval L. Patrick today announced the creation of a $20 million privately financed fund that will lend money to developers seeking to buy and redevelop abandoned or at-risk properties.
Loans will be available to both nonprofit and for-profit developers, and will target communities that have the largest concentration of foreclosed properties, including New Bedford.
“This rich blend of private and nonprofit resources will help us stabilize neighborhoods hard hit by foreclosure, and turn troubled properties into brand new affordable family housing opportunities,” Patrick said in a statement this morning.
The Massachusetts Housing Investment Corporation (MHIC), a private nonprofit that funds affordable-housing development, will implement and administer the fund, while the Mass. Department of Housing and Community Development (DHCD) will oversee the loan program.
“We’re giving local officials and developers the tools to work together to tailor local strategies that bring life to neighborhoods that would otherwise get significantly worse,” said Clark Ziegler, executive director of the Mass. Housing Partnership, a quasi-public agency that also supports affordable housing with private funding.
Money for the $20 million fund won’t come from state coffers. Instead, it will be supplied through $17 million in contributions from the two affordable-housing organizations and $3 million in contributions from two nonprofit foundations.
The loan fund will be structured in two tiers: an acquisition fund, with revolving lines of credit of $250,000 to $1 million to each organization for property purchases; and a holding-pool fund to provide funding for the rehabilitation and long-term stabilization of the properties.
News and information from the Mass. Governor’s Office is available at www.mass.gov.
