icon Breaking Ground

Jeff Mosley, Director and National Program Lead, Equitable Development Initiative, Capital Impact Partners, A Member of the Momentus Capital Family of Companies  

12 min read

Capital Impact Partners is an Arlington, VA-based nonprofit created by an Act of Congress to facilitate the development of cooperative housing.  

While cooperative housing still plays an important part of its overall mission, Capital Impact has become a successful lender and Community Development Financial Institution (CDFI) focused on revitalizing disinvested and underestimated communities across the country.  

More recently, Capital Impact has broken down racial barriers and expanded opportunities for developers of color through its Equitable Development Initiative (EDI); a new program funded by Wells Fargo called Growing Diverse Housing Developers; and another new program funded by Amazon called the Housing Equity Accelerator Fellowship. Through a combination of mentorships, training and access to capital, these three programs are creating opportunities for developers of color who have found it challenging to enter, grow and thrive in the affordable housing business.  

One person leading and advising many of these critically important efforts is Jeff Mosley, who joined Capital Impact in 2021 and has over 30 years of experience in financing affordable housing, organizational capacity building and housing policy.  

Tax Credit Advisor sat down with Mosley to talk about these programs in greater detail and Capital Impact’s lending efforts. 

Tax Credit Advisor: Capital Impact Partners began in 1982 to support the development of housing cooperatives. How does that interplay with expanding access to affordable housing?  

Jeff Mosley: Cooperative housing is part of the spectrum of affordable housing delivery. Capital Impact Partners has played a role throughout its history in supporting housing co-ops and shared equity models through capital investments and advocacy efforts. In Washington, DC, for example, we have the Tenant Opportunities to Purchase Act, which states that tenants in buildings up for sale must be offered the first opportunity to buy the building and help preserve it as affordable housing. It is a key feature of some of our lending today, which is why cooperative housing has remained a strong part of what we do. Capital Impact was also a founding investor in ROC USA, a housing co-op pioneering organization. 

TCA: How much total capital have you invested in affordable multifamily housing? Are you a national lender, or more regional? What types of affordable housing deals appeal to you the most? 

JM: We’ve invested over $460 million in affordable housing across the country. Our core geographies include the Washington, DC metro area, the New York City metro area, the Detroit/Great Lakes region, California and Texas. We primarily concentrate our investments in these areas, but we also lend nationwide. Whether it’s new construction or rehab, we want to make sure that we prioritize asset integration into the community, so that investments in housing mean something not only for the residents but that also benefits the community. We are very conscious of the role that affordable housing plays in a family’s life. As such, we focus on the social determinants of health and access to high-quality services, whether it’s health care, food services or transportation, so our investments in these housing developments have amplifying effects. 

TCA: Interesting. I’ve interviewed many developers who focus on providing a high quality of life for their tenants, but you’re the first lender to express similar sentiments. 

JM: We have a much more holistic approach and view of communities. We operate several programs that work well with housing, such as Nourish DC, which provides access to healthy foods in disinvested communities. There’s an understanding that the investments that we make in healthcare, education and access to healthy foods, that they all come together to ensure that we’re having a more comprehensive impact on communities; it all comes together. The communities that we invest in see a much more thriving economy. 

TCA: Tell me about the Growing Diverse Housing Developers (GDHD) program. Why did this start and how impactful has it been?  

JM: Based on our work with developers through the Equitable Development Initiative, where we work with emerging developers and address their needs to become successful, we know that even established developers still need a boost. Established developers face many of the same barriers as emerging developers do in accessing low-cost capital. One developer said they had a choice of either paying a light bill or investing in the pre-development phase of their project; it was that stark. Through GDHD, a multi-year program sponsored generously by Wells Fargo, we’re able to provide the necessary resources to foster their continued growth, such as flexible enterprise-level and project-based capital to help them to do both. We’re also making sure that they have access to knowledge and networks, advisors and mentors so that they are making the best decisions to stabilize and grow their businesses. We are partnering with two other national CDFIs—Low Income Investment Fund and Reinvestment Fund—to bring all our technical and financial capacity to work with 27 developers around the country. The participating developers identify themselves as racial and/or ethnic minorities. These are established developers in the for-profit and nonprofit sectors, who are focused not only on growing their enterprise and their capacity as developers but are conscious of having a meaningful impact in the communities where they work. They are interest rate sensitive. As with other firms, they are thinking about the impact of a changing economy on their deals. Having the capacity to restructure a deal, the knowledge to do it, but also then having capital partners with which to make that change is critically important. Finally, GDHD is almost like a living lab. We’re working with the Urban Institute to see how the participating developers’ fortunes improve over time. 

TCA: Can you please talk a bit about how structural or systemic racism led to this need or desire for Capital Impact Partners to help emerging developers of color further their careers? 

JM: Developers of color routinely face early and ongoing barriers to enter, grow and succeed as developers, including access to educational opportunities to learn about real estate development in a way that they can afford. School is expensive. Time is expensive. We have many passionate developers who come into this space without going through a real estate development program. The foundational concepts and principles are missing. Nor do they in many cases have the traditional access to ‘friends and family’ equity. By and large, families of color do not have the same liquidity or cash as white households. As a result, these emerging developers have no choice but to go to hard money lenders that offer predatory rates. This not only puts projects at risk but also the developer’s own financial health. These are critical barriers that can easily cause a developer to fail before they’re even at the first step. There’s also a lack of networks. I’ve often heard developers say, ‘I’ve grown up not seeing someone who looks like me doing this work in my neighborhood.’ We have created opportunities for them to work with peers and mentors so that they can go through this opportunity together and grow among a cohort of developers. 

TCA: How would you measure GDHD’s progress thus far? 

JM: We launched GDHD in May of this year and have a cohort of 27 developers who have begun this four-year journey that we’re very excited about. We are delivering a peer-driven curriculum focused on the growth of businesses, as well as next-level real estate development topics. The participating CDFIs are learning as well. We’re having in-depth conversations with developers about their capital needs and the obstacles that they’re facing. As a CDFI, we’re retooling our capital in real time to meet their needs. This is a very exciting moment for us. Not just Capital Impact, but as an industry, to be able to work with these developers who are doing the harder deals that another lender may not touch because the yield and rate of return are smaller. But these projects will have an important community benefit. These developers see a path forward while meeting a community need.  

TCA: You briefly mentioned the Equitable Development Initiative. Could you touch on what that is?  

JM: EDI started five years ago in Detroit, where we recognized that we were investing in disinvested neighborhoods but that the borrowers were not from these communities. EDI was piloted by our Detroit team to chart a path for developers of color to pursue projects and grow their own enterprises. EDI focuses on career growth and wealth building for these developers by providing training, mentorship and access to capital. We have 200 EDI alumni and current participants across the country. We were recently invited to come to the City of Dallas, where we launched our first developer cohort in that city. Looking at our pipeline nationwide from EDI, we have 14 projects with over $75 million in capital needs. When funds are available, we also offer pre-development grants that provide critical early capital support for developers. One of the key elements to our programs, and to me one of the more impactful, is that we’ve brought seasoned developers to the table to mentor and advise our EDI participants. One of the outcomes that we’re proud of is the joint ventures – two at this point, actual deals involving EDI cohort members and a mentor. It shows how impactful EDI has become that a for-profit developer is saying, ‘I will take a chance on these emerging developers.’ 

TCA: How do emerging developers find you, or their mentors?  

JM: It’s become word of mouth. We have a strong and growing network of alumni. Our partners include jurisdictions, like DC and Dallas government officials, and funders, like JPMorganChase and Morgan Stanley, who have recommended participants. We have skilled, experienced developers willing to serve as mentors to give their time to participate, so it’s sort of built into the program that the word of mouth has been great. Our EDI staff in Detroit, the DC metro area, the San Francisco Bay Area and Dallas have cultivated relationships with developers and stakeholders, and they have been our best ambassadors.  

TCA: What about universities? Have they helped to promote these programs? 

JM: We’re growing our relationships with universities. The University of Maryland’s School of Architecture, for example, shared the EDI program notice with some of its students and alumni, so we’re trying to leverage relationships with other universities in different ways. 

TCA: Besides the GDHD program, what steps can the affordable housing industry take to support and grow the number of minority-owned developers?   

JM: We reached a point where Capital Impact Partners, CDFIs and traditional lenders recognize some of the barriers that I’ve spoken about and are looking at ways to meet the capital needs of emerging developers. We all agree that it makes good business sense to invest in these developers. That when we’re working in partnership, these are sound, reasonable, real estate development deals. Other sectors and partners in the real estate industry can support these developers by acknowledging these barriers to entry, the obstacles to accessing affordable capital, and opening opportunities for development relationships to ensure that these developers gain the experience necessary to be successful. It can take the form of mentorship opportunities and internship opportunities from large-scale developers, considering joint ventures, and by supporting programs like ours, and serving as presenters, mentors and advisors. It is that type of critical, technical knowledge that can really boost not only our program but the success of these emerging developers. The National Housing & Rehabilitation Association and its members do a lot to support our EDI. 

TCA: What are your major focus areas for 2023? You can speak to EDI and GDHD since you manage those programs, but feel free to speak about Capital Impact Partners more broadly.   

JM: We have received a lot of interest in EDI from other communities around the country and are exploring these market opportunities. We are also very conscious of making deeper impacts in the communities we already serve. We have also created our Diversity in Development Loan Fund, providing flexible financing to meet developers’ capital needs. One of my favorite projects, by the way, is in the Deanwood section of the District of Columbia, where one of our EDI alumni is undertaking a mixed-use development that will include retail space for a small grocery store in that section of Northeast DC. We’re excited that one of our alumni can take on such an impactful project. As for Capital Impact Partners and the Momentus Capital family of companies, my colleagues are continuing to work on innovative ways to help deliver capital—financial, knowledge and social—to entrepreneurs and local leaders at every stage of their growth. I am pleased, for example, that we have launched our Diversity in Development Loan Fund to provide critically needed project capital. I’m very proud to be part of this team and am looking forward to seeing how else we will continue to fulfill our mission over the coming year.  

Darryl Hicks is vice president, communications for the National Reverse Mortgage Lenders Association and a 24-year veteran of associations managed by Dworbell, Inc., the management company of NH&RA.