Can Big Tech Solve Housing Affordability?

The upcoming presidential election has put affordable housing in the spotlight, but the issue has been top of mind for many businesses for a long time. Big Tech companies have made millionaires out of early employees but have also had an outsized effect on housing prices. As these companies changed the economy in cities like Seattle, San Francisco, and San Jose, they've also started to focus on solving some of the problems they may have helped create. 

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Amazon's Housing Equity Fund

Amazon's Housing Equity Fund was started in 2021 and has grown to $3.6 billion. It offers funding in the form of below-market loans and grants to developers. The money will be used to renovate and build around 35,000 affordable homes for individuals and families earning moderate to low incomes in three major metros where Amazon has a huge presence: the Puget Sound region, Arlington, Virginia, and Nashville. The fund first launched with $2 billion and created or preserved 21,000 homes in the first three years. The latest tranche of funding, a $1.4 billion pool, is now open for developer applications.

Amazon also launched the Amazon Housing Equity Accelerator, a free, 18-month program to help grow the careers of diverse real estate developers. Amazon has invested $25 million to support the program and graduated 38 developers so far. "We know housing is a really big challenge for a lot of people, especially in and around expensive metro areas, and we feel strongly that we can help give back to our communities by helping preserve and create thousands of affordable homes," said CEO Andy Jassy. 

Apple And The Bay Area Housing Innovation Fund

Apple is the major donor behind the Bay Area Housing Innovation Fund, an initiative to make loans for affordable housing projects. The first $50 million investment will fund four projects that will create over 400 homes within the next two years. The first project is Mercy Housing, an affordable development in San Francisco's Mission District offering 145 units of permanent supportive housing for seniors. Another project is planned for Santa Cruz. Apple committed $2.5 billion for affordable housing in California in 2019 and has already deployed $1.6 billion. Developers working with Apple are building or preserving more than 10,000 units statewide. Working with partners that include Housing Trust Silicon Valley, California Housing Finance Agency, and the United Way of Greater Los Angeles, Apple has helped California residents stay housed and finance home purchases.

Alphabet's Housing Efforts

In 2019, Alphabet announced a $1 billion housing initiative. That total included $750 million in land that the company already owned and planned to repurpose. Like Apple, Alphabet, through Google, has worked with Housing Trust Silicon Valley and invested $50 million in the Housing Trust's TECH Fund in 2020. Much of Google's efforts have centered on the San Jose area. The company is currently pursuing the idea of a mixed-use community in the Downtown West area that would have a designated affordable housing development in a former retail location. Google has been at work on this project for a while. Plans got put on pause in 2023, but appear to be back on track. 

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These aren't the only initiatives from large tech companies. Microsoft committed $750 million back in 2019 and as of 2022, it had deployed $583 million to create and preserve around 9,200 units of housing in the Puget Sound area. In 2019, back when Meta was still Facebook, it announced a $1 billion affordable housing initiative that included $225 million in land donations in Menlo Park, CA, where the company is headquartered. Housing affordability is also part of the efforts of the Chan-Zuckerberg Initiative, the foundation created by Meta CEO Mark Zuckerberg and his wife, Priscilla Chan. In April, the nonprofit opened applications for funds that finance multiple rental and owner-occupied housing projects benefiting low and moderate-income households.

Like many issues in our modern society, a mixture of private and public capital may be necessary to bring about substantive change. While the amount of money that large technology companies are allocating to housing is substantial, with as many as four to seven million units of affordable housing needed, there is still a long way to go. 

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