Foundation Communities gets $1.5M, seeks more to fund affordable housing projects
Friday, April 23, 2021 by Chad Swiatecki
A pair of affordable housing apartment complexes from Foundation Communities have received $1.5 million in subsidies to help pay for their construction costs and cover part of a remaining fundraising gap.
Wells Fargo and the Federal Home Loan Bank of Dallas have given two $750,000 Affordable Housing Program subsidies to the under-construction Zilker Studios on South Lamar Boulevard and the Loretta, a North Austin project expected to begin construction soon.
The $25 million project Zilker Studios, which is being built on the site that was formerly Armadillo Studios, will provide 100 rental units to low-income single adults. The Loretta, at 13649 Rutledge Spur, is a $31 million project that will provide 137 units intended for low-income families and singles.
To date, FHLB Dallas and Wells Fargo have provided grants, tax credit equity and loans for several Foundation Communities projects. Walter Moreau, executive director of Foundation Communities, said the subsidies were factored into the funding plan for both projects. A funding gap of $3.8 million remains to fully fund both projects.
“We were counting on the funds when we applied, but not sure if they would be approved, so we are relieved. The funds will be used to cover the construction costs of both new communities,” he said. “Both projects still have a fundraising gap, especially to build apartments for families and individuals that have been homeless.”
Affordable Housing Program subsidies are intended to assist with financing the purchase, construction and/or rehabilitation of owner-occupied, rental or transitional housing and housing for homeless individuals. The funds must be used to benefit households with incomes at or below 80 percent of the median income for the area.
“This is a homegrown nonprofit that has succeeded in providing innovative and affordable housing and opportunities that transform people’s lives,” Wells Fargo spokesperson Theresa Alvarez said of Foundation Communities’ work.
Zilker Studios will exclusively feature small units of around 450 square feet that will be open to tenants earning less than 50 percent of the Austin region’s median family income, or around $35,000 per year.
Half of the units will be reserved for those earning substantially less than 50 percent MFI. Last year Austin Towers reported that Foundation Communities had purchased the half-acre piece of property with the help of $2.5 million in community benefits funding from former professional baseball player and developer Huston Street.
In an early description of the seven-story project, Foundation Communities said Zilker Studios would be a housing-plus-services model development to provide adequate stability and care for residents with needs beyond that of traditional residential developments.
Less is known about the Loretta, but available documentation shows all of its units will be for residents earning 60 percent or less MFI, with 84 of them reserved for those earning 50 percent or less and 14 percent set aside for 30 percent or less of MFI.
Last year the project applied for just over $1 million in funding from the Austin Housing Finance Corporation, which had previously given it $2.9 million. Construction is expected to begin next month with an expected completion date in October.
Other organizations involved in the development of the Loretta include Hatch + Ulland Owen Architects, Civilitude, Rigby Slack, and Betco Housing Lab.
Rendering of the Loretta courtesy of Foundation Communities.
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