Neighborhood Allies will be the agent for the revolving loan pool.

By Paul J. Gough | Pittsburgh Business Times | March 20, 2023 | Read the full article

UPMC subsidiary UPMC For You, the Henry L. Hillman Foundation and The Heinz Endowments on Monday unveiled a $11 million loan program to preserve affordable housing in Allegheny County.

Dubbed Preserve Affordability Pittsburgh, the loan program will provide loans for developers who have plans to acquire existing affordable housing in mixed-use residential, family or senior housing with at least 20 units. The amount of loans will vary but UPMC For You President John Lovelace said the goal is designed to save 1,200 units of housing over the next 10 years.

Preserve Affordability Pittsburgh is part of a larger UPMC Health Plan initiative that has been working to preserve affordable housing.

“This is the second big investment,” Lovelace said.

The first program was a $3 million loan program for affordable housing that was matched by Bridgeway Capital and then added to with $1.5 million from the Kresge Foundation.

That first program differs from the new one beyond the amount of money in the loan pool, said Raymond Prushnok, executive director of the UPMC Center for Social Impact. The program with Bridgeway Capital was designed to preserve affordable housing in the City of Pittsburgh and also aimed at UPMC for You members facing housing insecurity. UPMC For You is UPMC Health Plan’s Medicaid managed care program.

This time around, along with the support of the Heinz Endowments and the Henry L. Hillman Foundation, Preserve Affordability Pittsburgh will be expanding its scope to all of Allegheny County and nonUPMC members too.

Prushnok said UPMC Health Plan does a lot of work around housing, whether it’s supporting members who are homeless or with community housing services. But he said it also sees a role, as an anchor institution in the Pittsburgh region, to be able to support a wider impact. It’s part of UPMC Health Plan’s focus on what is called the social determinants of health, nonmedical factors that help determine an individual’s health status.

UPMC Health Plan provided data that there is a shortage of 27,000 units of affordable housing — where the resident is paying no more than 30% of gross income on housing — in the Pittsburgh region.

“With this new project, the goal is preservation,” Prushnok said. “One of the things that is striking is that we have a 27,000-unit shortage of affordable housing in greater Pittsburgh and the place we’re losing it the fastest is naturally occurring affordable housing.”

That naturally occurring affordable housing is in areas where it has traditionally been occurring but now is at risk.

“This fund is specifically looking to identify opportunities where that naturally occurring affordable housing might be leaving the market and giving a mission-minded developer access to capital quickly,” Prushnok said.

UPMC For You will be working with Cinnaire Lending, based in Michigan, this time around. Neighborhood Allies will be the agent for the revolving loan pool.

Lovelace said the foundations’ support has been crucial to allow the loan pool to provide low-interest money that will lower the cost of development for the entire project.