Expanding an affordable housing mission from Richmond to Petersburg
Southside Community Development and Housing Corporation (SCDHC) is a nonprofit serving Richmond and the counties of Chesterfield and Henrico.
The organization earns most of its revenue through home sales to individuals and families earning below 80% of the area median income. That means price points are typically between $160,000 and $180,000 for a new home certified by EarthCraft, a top standard for environmental stewardship in building materials, environmental use, and daily operation.
Yet in the City of Richmond, in particular, housing stock for affordable homes is in low supply due to rising property values, competition from private developers, a lack of home sites, and unpredictable grant funding.
As part of its strategic plan, SCDHC decided to invest in multifamily apartment development and management and to expand its geographic reach even further south into the Tri-Cities. For its first initiative, leaders eyed a 10-unit multifamily building at 714 High Street in Petersburg, as well as a vacant lot at the adjacent 712 High. The building at 714, located in the historic Old Towne, was renovated in January 2013 and is fully occupied, with rents ranging from $750 to $995. On the empty lot, SCDHC is raising funds to build a 12-unit multifamily apartment building that will ensure affordable rents for individuals and families.
Petersburg is one piece of the affordable housing puzzle that SCDHC looks to solve in Central Virginia and the Tri-Cities. For more than three decades, the organization has built affordable housing throughout the Richmond region and helped hundreds of families and individuals purchase homes through its HUD-approved housing-counseling program.
Due in part to the organizations’ highly aligned missions, SCDHC approached VCC with its Petersburg multifamily opportunity. VCC Bank is a valued partner of the nonprofit, assisting the organization with purchasing properties and land throughout Central Virginia.
For the Petersburg project, VCC approved a loan of $586,000 to buy the 714 High Street building and the bordering development-ready lot at 712 for a total purchase price of $690,000. Because of the COVID-19 pandemic, VCC also allowed the loan to be interest-only for six months, giving the borrower greater flexibility.
Petersburg has long been a city primed for revitalization, and one that has faced its share of socioeconomic challenges and setbacks — COVID-19 notwithstanding. But so many still believe in the city’s potential.
SCDHC is one of them. So is Virginia Community Capital.
In addition to providing more affordable housing in the Tri-Cities, the revenue-driving Petersburg project is helping offset SCDHC’s challenge of securing homebuilding sites in Richmond. The rents at 714 High, and projected rents on 712, will provide sustainable income to SCDHC in the years to come.
SCDHC also goes beyond constructing and operating buildings. In Richmond, for example, the nonprofit offers financial counseling and a new homebuyer orientation service to income-qualified individuals, as well as employment, financial, and benefits coaching. They have an ample pipeline of income-qualified home buyers and are building a community of townhomes. SCDHC is also a general partner in a low-income housing project in Sandston, known as Sandston Seniors.
VCC has also long been active in Petersburg and its Old Towne District.
- This year, Tri-Cities region-focused nonprofit The Cameron Foundation renewed a $1 million loan and deposit account with VCC. The funds are being deployed into the Tri-Cities area. A similar 2017 investment directly increased VCC loan activity in the Tri-Cities, too. From 2017 to the end of the first quarter of 2020, VCC leveraged the foundation’s initial $1 million to make loans in Chester and Petersburg totaling $5.5 million — creating 52 new housing units and 27 jobs.
- VCC is also a partner with Petersburg developer Dave McCormack, helping fund his Trapezium Brewing Company. The brewery created a lively, vibrant gathering place and gave new life to a vacant building. It also attracted residents and visitors to Old Towne Petersburg while creating jobs and revenue for the city.
- In the wake of the COVID-19 pandemic, VCC made four Paycheck Protection Program loans totaling $125,325 in the Tri-Cities. These loans saved 12 jobs and included one nonprofit, one woman-owned, one minority-owned, and one veteran-owned organization.
- VCC provided in-kind technical assistance to support the Petersburg Economic Development Authority throughout 2018 and 2019 in meetings and workshops focused on improving access to healthy foods in the region.
The United Nations created 17 global Sustainable Development Goals (SDGs) that aim to eradicate poverty and deprivation, grow our economies, protect our environment, and promote peace and good governance. These SDGs best align with VCC, and our mission to positively impact communities.
The SCDHC loan aligns with SDGs 1 and 11.