The Denver Transit-Oriented Development (TOD) Fund was born out of a recognition that the expansion of Denver’s public transit via FasTracks, a voter approved ballot initiative, had the potential to provide access to opportunity for low-income and disadvantaged residents throughout Denver, but only if they could afford to live where transit was accessible.
A public infrastructure investment of this magnitude generally leads to substantial private real estate investment and development, designed to take advantage of proximity to an expanded transit system.
But due to the added costs and complexities inherent to transit-oriented development and the increased land values that result from an upturn in private investment, the apartments and homes in these areas quickly become too expensive for the working class and low wage earners to afford.
Many are priced out of their homes and neighborhoods and are forced to move further away from transit, from jobs, from schools, services, and amenities.
The City of Denver, Enterprise Community Partners and the Urban Land Conservancy, along with many critical public, private and philanthropic partners sought to create the country’s first innovative financial tool that would attempt to address this challenge. The most effective way to ensure long term affordability of housing near transit is through site control by a mission driven owner – in this case ULC.
ULC believed it could be effective in acquiring several transit-oriented sites in Denver and preserving them for affordable housing and community facilities if it had access to flexible and inexpensive financing.
Enterprise was able to leverage a $2.5M investment from the City’s Office of Strategic Partnerships and Office of Economic Development with $12.5M of additional private investments from the MacArthur Foundation, Rose Community Foundation, the Colorado Housing and Finance Authority, Mile High Community Loan Fund, U.S. Bank, Wells Fargo, First Bank, its own loan capital and ULC’s equity.
The Denver TOD Fund was closed in April 2010 with a goal of creating/preserving 1,000 units of affordable housing in proximity to public transit in Denver.
The Fund’s unique combination of capital from organizations with varying risk tolerances and return requirements allows ULC to pursue the acquisition of transit-proximate sites in a time and cost efficient manner – often an edge in a competitive TOD real estate market.
From 2010 to today, through one of the most difficult real estate cycles Denver has ever seen, the TOD Fund facilitated the acquisition of 8 different sites on 5 different transit corridors throughout the City.
ULC, through partnerships with affordable housing developers, has teed up on these sites a pipeline of over 625 permanently affordable apartment homes and well over 100,000 square feet of supportive nonprofit and community commercial space, all within close walking distance of light rail and high-frequency bus access.
In just over three years, the Fund has deployed over $15 million of capital, and thanks to the revolving nature of the committed capital, has several million more available to lend!
On August 27, the TOD Fund and its partners will be celebrating the full deployment of the Fund’s capital while it also celebrates, along with ULC and Medici Communities, the grand opening of Evans Station Lofts. This property is a mixed-use development with 50 units of affordable rental homes and shared nonprofit office, commercial and retail space on the ground floor, all directly across the street from the Evans Light Rail Station on the Southwest Corridor.
No detail was overlooked in the construction of these one and two-bedroom apartments, featuring 10-foot ceilings, glass-tile accents in the showers, access to a community room with laptop computers, an exercise room, a rooftop barbeque area, a shared car for hourly rental and plenty of other amenities.
Enterprise is now hard at work in its effort to broaden the Fund’s impact by doubling its size to $30 million, expanding its reach to the entire Denver metro region, and making the capital available to additional mission-driven borrowers to help ULC and Fund investors build on the momentum, and more importantly, the opportunities that the Fund has created in Denver.
The City of Denver, Enterprise, and ULC would like to take this opportunity to thank everyone who has supported this unique vision from the beginning.
The success of the TOD Fund is nationally recognized for good reason. The significant impact the Fund has made in only 3 years is a leading example of how public, private and nonprofit collaboration can accomplish strategic goals otherwise unattainable by any one sector alone.
The Fund’s partners and investors continue to work diligently to preserve and develop affordable homes and needed services at transit stations for those who need it most. Stay tuned – there is much more work to be done!