Chase Investment Leverages $27.7 million and 600 Renovated Units

In just three years, three local non-profit lenders leveraged $5 million into $27.7 million to revitalize nearly 600 deteriorating single-family homes and two-flats in distressed Chicago area neighborhoods – and they stand ready to do more.

In the wake of the 2008 housing crash, vacant 1-4 unit buildings in the area’s hardest hit communities threatened to drag down entire blocks. To combat this threat, three area nonprofits leveraged a $5 million grant from JPMorgan Chase Foundation into $27.7 million in private capital to improve nearly 600 units. The best news of all – resources are still available to communities continuing to struggle.

The 1-4 unit rental stock historically functioned under the radar, until the crash sent small owners and renters into a tailspin. Community Investment Corporation (CIC), Neighborhood Housing Services of Chicago (NHS), and Chicago Community Loan Fund (CCLF) rallied around 1-4s, and used the $5 million grant to seed a collaborative strategy with complementary financing programs to redevelop and preserve both rental and owner-occupied homes. These three Community Development Financial Institutions (CDFIs) focused on a handful of neighborhoods to maximize their impact.

JPMorgan Chase recognized the power of CDFIs when they designed the PRO Neighborhoods pilot program in late 2013. To document the results and the lessons learned, Chase commissioned Harvard’s Joint Center for Housing Studies to perform case studies on a number of the collaboratives including the Chicago 1-4s program. “The Chicago case study illustrates what CDFIs can accomplish, and the potential unleashed when they deploy their resources collectively. Concrete evidence shows how coordination leverages performance, and how the rewards can stretch into the future,” explained Daniel Sprehe, Managing Director for Corporate Responsibility at JPMorgan Chase. That case study can be found here. A video also highlights local buildings and families assisted by the program.

The three organizations coordinated closely with the City of Chicago Micro Market Recovery Program (MMRP) to target their activities. “The MMRP program was created to attract and focus housing resources in concentrated areas to maximize results. The Chase 1-4s Collaborative is an important part of this effort to preserve an essential component of Chicago’s affordable housing stock,” noted David Reifman, commissioner of the City of Chicago Department of Planning and Development.

CIC led the Collaborative effort with an acquisition pool, CCLF provided financing to small-scale developers for acquisition and rehab, and NHS provided financing to homebuyers and homeowners. Together, they generated $27.7 million in investment in 1-4 unit buildings, most of which were vacant, boarded-up eyesores as a result of foreclosure and abandonment. Overall, when the subsequent construction cost on CIC acquired buildings is included, the Collaborative leveraged more than $41 million.

CIC finances the acquisition, rehabilitation, and preservation of affordable rental housing throughout the Chicago metropolitan area.

Chicago Community Loan Fund provides flexible, affordable and responsible financing and technical assistance for community stabilization and development efforts and initiatives that benefit low- to moderate-income neighborhoods, families and individuals throughout metropolitan Chicago.

NHS advocates for working families and revitalizes communities through community building, real estate development, mortgage lending, homeownership education, and housing policy.