SoLa Impact, an affordable housing developer based out of South Los Angeles, has gotten another $50 million investment in its Black Impact Fund.
The California State Teachers’ Retirement System invested through a joint venture with Belay Investment Group, SoLa Impact announced on Tuesday.
The new investment brings SoLa Impact’s fund to $250 million. The developer is planning to close out the fund once it reaches a target of $300 million.
SoLa Impact is planning to invest in affordable and workforce housing with an eye on providing rental stock in communities of color across California, the firm said. Affordable housing is often set aside for tenants who make up to 80 percent of an area’s median income, while workforce housing refers to middle-income earners, usually making between 80 and 120 percent of an area’s median income. Both typically involve some public subsidy or support in California.
Dubbed the Black Impact Fund, SoLa Impact will invest in both federally designated opportunity zones and surrounding areas.
CalSTRS’ investment comes on the heels of a $25 million equity investment from PayPal, which will go towards housing around opportunity zones.
Other financial institutions that have invested in SoLa Impact’s fund include Ally Bank, Potenza Capital, Pacific Premier Bank and Adirondack Capital.
SoLa can work on “quality new construction at a cost basis that allows for attractive investor returns while offering rental rates that low- and middle-income residents can afford,” Julie Donegan, who works with CalSTRS’ real estate team, said in a statement.
The new funding comes as construction for affordable housing has soared across the state. In 2020, it cost developers about $500,000 per unit on average to build affordable housing, according to state estimates at the time. This month, the City of L.A. spent an average of almost $600,000 per unit on construction of homeless housing projects, according to a report from City Controller Ron Galperin.