FOR IMMEDIATE RELEASE: September 22, 2022
CONTACT: Lisa Patlis, (802) 861-3814
Burlington, Vermont and Portland, ME – Evernorth is pleased to announce that it closed an $8.95 million loan fund capitalized with investments from eight major Upper Valley employers. Dubbed the Upper Valley Loan Fund (the Loan Fund), this fund will loan money to developers and other entities to build affordable apartments targeted to renters with moderate incomes. The Loan Fund will help catalyze rental housing production in a segment of the market serving employees who are increasingly priced out of the housing in the area.
Due to the critical housing shortage in the Upper Valley region of New Hampshire and Vermont, area employers increasingly cite the lack of access to quality affordable housing as a key barrier to recruitment and retention of employees. According to a recent report by Vital Communities, a regional civic engagement organization, the Upper Valley needs 10,000 new homes by 2030 to meet demand (requiring a tripling of the current annual rate of housing production).
In order to respond to the needs of their communities, a group of Upper Valley employers formed a regional Workforce Housing Initiative, led by a Steering Committee comprised of local business leaders. Evernorth’s Upper Valley Loan Fund is a collaboration borne out of this community work and is one step to accelerate the pace of affordable housing development.
Evernorth will manage the Upper Valley Loan Fund and work with developers to offer low-cost, flexible financing for affordable housing projects that will produce an estimated 260 additional rental homes in the region, of which 243 (94%) will be affordable to people earning between $13 and $25 per hour (below 80% of the area median income). The Loan Fund investments will leverage an estimated $67 million of other public and private financing to accelerate the production of workforce housing.
“The bottom line is that the workforce cannot find an affordable place to live in the Upper Valley,” said Deb Flannery, VP of Lending at Evernorth. “The Loan Fund will build or preserve apartments for people who can afford rents of $1,200 to $1,600 per month. By comparison, the current market rate for apartments in Grafton and Windsor counties is between $1,500 to $2,200 per month. So, you can see that by leveraging these employer dollars we will be able to create considerable savings for the workforce as compared to what the market is producing,” Flannery said.
The eight employers in the Loan Fund include: Bar Harbor Bank, Citizens Bank, Dartmouth College, Dartmouth Health, Hanover Co-op Food Stores, Hypertherm, King Arthur Baking and Mascoma Bank.
Nancy Owens, Evernorth’s Co-President said, “These employers came together in the Loan Fund because they all believe that investing in building affordable housing will strengthen the regional economy and ultimately benefit their business.” Owens continued, “They have joined together to leverage their resources through Evernorth’s program to invest for the greater good of the community. Our collaboration to address housing needs in the region brings new resources and perspectives to these complex issues.”
“The ability to attract and retain employees is directly related to the housing shortage here in the Upper Valley,” said Clayton Adams, President & CEO at Mascoma Bank. “ Without workers who have a place to live, the economy as we know it will cease to function effectively. I’m very grateful to Evernorth for being such a strong partner in this effort. Their expertise will help employer capital make a difference in addressing our region’s housing crisis.”
“Dartmouth Health is proud to partner with Evernorth and other Upper Valley business to aggressively address the shortage of affordable housing,” said Michael Waters, Dartmouth Health Treasurer. “Our investment in the Upper Valley Loan Fund is another great step to assist in improving access to affordable housing which helps our efforts to recruit critical workers to our Dartmouth Health locations serving the Upper Valley.”
Currently, there are 420 units of affordable housing in the region which are reserved for households with incomes below 80% of the area median. By adding 243 affordable units, the Upper Valley Loan Fund will increase the supply of income targeted units by 58%. Sustained production of income targeted housing at this level is necessary to alleviate rent burdens on households earning less than 80% of the median income for the region.
Evernorth estimates the funds will be deployed over two to three years in two to four transactions per year.