The Enterprise Social Investment Corporation and Fannie Mae Announce $100 Million Tax Credit Partnership Fund to Spur Supportive Housing Development NEW YORK, July 8 /PRNewswire/ -- On the heels of New York City Mayor Michael Bloomberg's announcement of an ambitious plan to reduce the number of homeless people in New York City by creating 12,000 units of supportive housing over 10 years with city, state, and federal funds, Fannie Mae (NYSE: FNM), the nation's largest source of financing for home mortgages, and The Enterprise Social Investment Corporation (ESIC) announced a $100 million Low- Income Housing Tax Credit (LIHTC) fund to help increase the supply of permanent supportive housing nationally for chronically homeless people. The fund has been under development since March, when Fannie Mae announced its expanded American Dream Commitment(R). At that time, Fannie Mae said it would work with its partners to create at least two new LIHTC funds dedicated to permanent housing for the homeless. The Enterprise Foundation, of which ESIC is an affiliate, has committed to build 2,500 new supportive housing units in New York, investing in tax credit equity, acquisition and predevelopment loans, and providing grants in the process. Permanent supportive housing is considered to be an effective way to help people make the transition from homelessness to sustainable independent living by providing counseling and services in addition to shelter. A study conducted by The Enterprise Foundation found that residents living in supportive housing were able to increase their monthly income from $225 to $643; decrease their hospitalization rate from 65 percent to 38 percent; and increase their average residential tenure to 4.6 years. Fannie Mae and ESIC are committed to helping a coalition of organizations dedicated to ending homelessness through the creation of permanent supportive housing nationally. As part of this commitment, Fannie Mae today presented $1 million of a five-year, $5 million grant to the Corporation for Supportive Housing (CSH), a national nonprofit organization that helps communities create permanent housing with services to prevent and end homelessness. Participating in today's announcement at Chelsea Court, a model 18-unit permanent supportive housing residence opened a year ago by Palladia Inc., with financing from Fannie Mae, ESIC and the New York City Department of Housing Preservation and Development (HPD) were: Linda Gibbs, New York City Department of Homeless Services commissioner; John Warren, HPD first deputy commissioner; Carla Javits, president of CSH; Bart Harvey, chairman and CEO of The Enterprise Foundation and chairman of ESIC; and Daniel H. Mudd, vice chairman and COO of Fannie Mae. "The $100 million investment we are announcing today is the first of many initiatives we and our partners will undertake to tackle homelessness," said Mudd. "While America is among the world's best-housed nations, homelessness is a chronic and growing problem. Fannie Mae is going to invest its creativity and capital to help expand the stock of permanent supportive housing for families and individuals that are homeless. We are honored to make ESIC our first partner in this initiative." "For more than 20 years The Enterprise Foundation and ESIC have worked to restore and stabilize urban communities through the development of affordable housing, and Fannie Mae has supported our efforts with its investments," said Harvey. "We are pleased to announce this timely initiative to extend our work beyond bricks and mortar, to contribute to the development of supportive housing for those who may need help with life's challenges in New York and nationwide." ESIC has financed 17,000 units of supportive housing nationwide. Supportive housing studies have concluded that homeless people achieve improvements in housing stability when services that provide counseling for issues such as substance abuse, mental illness, the absence of job and financial management skills, and health are combined with housing. Unlike community residences and shelters, supportive housing allows tenants a choice in their living arrangements, separating housing from the support services they receive on-site or nearby. "New York has struggled, as have many American cities, with a disturbing increase in the number of people who are homeless, many for long periods of time," said Gibbs. "Studies initiated more than a decade ago have helped us understand the value and efficacy of supportive housing. Today's announcement by Fannie Mae and ESIC will help New York get off to a fast start with our plan to create 12,000 new supportive housing units for the chronically homeless." LIHTCs are provided by the federal government to encourage corporate investment in housing that is affordable to people earning up to 60 percent of an area's median income, which is $32,640 in New York City. Fannie Mae invests primarily through limited partnership funds that pass the LIHTC benefits through to investors, and is the largest single investor in LIHTCs to increase the availability of affordable multifamily housing. The LIHTC fund announced today will primarily support developments for individuals and families earning less than 30 percent of an area's median income. The $100 million equity investment through ESIC and the $5 million grant to CSH are part of Fannie Mae's expanded American Dream Commitment to expand access to homeownership for millions of first-time home buyers; help raise the minority homeownership rate to at least 55 percent; make homeownership and rental housing a success for millions of families at risk of losing their homes; and expand the supply of affordable housing where it is needed most. The Enterprise Social Investment Corporation (ESIC) is a national leader in affordable housing and community revitalization efforts. Founded in 1984 as a socially motivated for-profit affiliate of The Enterprise Foundation, ESIC's direct core business is syndicating Low-Income Housing Tax Credit (LIHTC) equity investments. ESIC advocated for and took a lead role in the creation of LIHTC legislation, a federal program enacted in 1986 that encourages the private investment of capital for the development of decent, affordable housing and the rehabilitation of existing affordable housing for low-income people throughout the United States. Since the LIHTC program's establishment, ESIC's syndication group has raised and currently manages nearly $4 billion in equity through more than 85 investment funds, including national multi- investor funds, private label funds and a variety of regional funds. These investments are helping to build an estimated 70,000 affordable homes in 45 states, Puerto Rico and the District of Columbia. http://www.esic.org/ Fannie Mae is a New York Stock Exchange company and the largest non-bank financial services company in the world. It operates pursuant to a federal charter and is the nation's largest source of financing for home mortgages. Since 1968, Fannie Mae has provided $5.9 trillion of mortgage financing for 60 million families. More information about Fannie Mae can be found on the Internet at http://www.fanniemae.com/. The American Dream Commitment is a registered mark of Fannie Mae. Unauthorized use of this mark is prohibited. Style Usage: Fannie Mae's Board of Directors has authorized the company to operate as "Fannie Mae," and the company's stock is now listed on the NYSE as "FNM." In order to facilitate clarity and avoid confusion, news organizations are asked to refer to the company exclusively as "Fannie Mae." DATASOURCE: Fannie Mae CONTACT: Michael Dutton of Fannie Mae, +1-215-575-1538; Sandi Abadinsky Baer of The Enterprise Foundation, +1-202-256-4749; or Sally Robey of ESIC, +1-443-694-1780 Web site: http://www.fanniemae.com/ Company News On-Call: http://www.prnewswire.com/comp/305450.html

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