What is a Quick Strike Property Acquisition Fund?

• A Quick Strike Property Acquisition Fund is a revolving pool of dedicated resources for quickly and nimbly acquiring properties in private market transactions or at sheriff sale to support our affordable housing goals.

• This fund would pre-certify non-profit housing developers with a history of success in building, repairing, and operating affordable housing so that they can compete with outside investors and private equity funds.

• These homes can then be sold to income qualified first time homebuyers or retained as permanent affordable rental housing.

Why do we need a Quick Strike Property Acquisition Fund?

• There is a growing trend of investors purchasing properties as speculative investments without any real commitment to the community or adding any real value. This results in the loss of both affordable homeownership opportunities and naturally occurring affordable rental housing as these properties are turned into more expensive rental housing. Many of these investors are not from Philadelphia or even Pennsylvania and are just out to extract the equity from properties and the wealth from our communities.

• If this problem is not addressed, investors will continue to control more and more of our housing supply at the expense of Philadelphia residents.

• In private market transactions, properties usually come up for sale quickly and CDCs/non-profits cannot access capital quickly enough to compete with deeper pocketed outside investors capable of nimble cash transactions.

• With more flexible capital, local non-profits could better compete to purchase available homes to repurpose for existing neighborhood residents as affordable homeownership or rental opportunities.

• This is a model with demonstrated success: when CDCs do have access to capital they have shown the ability to purchase key properties to maintain neighborhood affordability.

Proposed Solution

• Establish a Philadelphia Quick Strike Property Acquisition and Stabilization Fund (QSA Fund) with a $4 Million initial investment from the City to be leveraged with Philanthropic and other funds to grow to a $20 Million Fund over time.

• House the Fund at a Community Development Financial Institution (CDFI) with an understanding of the risks and need for speed.