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As the industry continues to push for progress against structural racism while navigating a recession, Community Development Financial Institutions are becoming important commercial partners for developers and planners looking to revitalize distressed areas.
CDFIs, which provide financial services to underserved communities, have been around since the CDFI Fund was established as an agency of the Department of the Treasury in the mid-1990s. The fund promotes capital investment in low-income communities through direct awards, New Markets Tax Credit Program allocations and other initiatives.
The institutions provide crucial market intelligence about the communities they serve while increasing focus on providing equity for all local stakeholders, including women and BIPOC — all while knowing the latest tax credits for distressed areas, making them catnip for savvy development teams.
Because CDFIs have to invest in properties and communities most in need of redevelopment, CDFIs do not face the same loan-to-value constraints as traditional banks regulated by agencies like the Federal Deposit Insurance Corp. That makes them a more flexible financing option for both local investors and developers alike."If there is a…
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