A unique deal between a property developer and two social lenders could pave the way for a new approach to social housing.
Social Ventures Australia (SVA) in collaboration with Social Enterprise Finance Australia (SEFA), have provided a construction loan to non-profit Sustain Community Housing in a deal that signals a new way to address Australia’s social and affordable housing challenge.
Josh Vrsaljko, Founder and Executive Director of Sustain Community Housing said:
‘The partnership with SVA and SEFA means that this development model can become a reality – where mainstream homes are built alongside social and affordable housing stock, with no reliance on Government funding.’
SVA and SEFA provided the senior debt with the remainder coming from private investment. The $2m deal will finance the development of six dwellings on subdivided land in Colyton in Western Sydney. In what is expected to be the first project of many, four of the dwellings have been sold privately and two dwellings will become social housing which will be retained by Sustain Community Housing.
This is the first time that two SEDIF[1] lenders have worked together to maximise social outcomes. SEFA lends to social enterprises with a social mission at their core and a community, Indigenous or environmental focus.
The SVA investment came through the Social Impact Fund (SIF), which was set up to provide loans and equity investments to social enterprises focused on improving life outcomes for disadvantaged members of the Australian community.
Director of Impact Investing at SVA Mark Peacock commented:
‘This is an exciting opportunity to partner with another social purpose organisation to back an innovative social entrepreneur dealing with one of the country’s biggest social challenges – the lack of social and affordable housing.’
‘Stable and secure housing provides a foundation on which people can build and sustain a future for themselves. Without secure housing it is very difficult for people to maintain or find work, or even to handle the day-to-day family and social commitments that allow people to meet their most basic needs.’
CEO of SEFA, Ben Gales said, ‘I am delighted to support Josh and Sustain Community Housing, in collaboration with SVA. We hope this is the first of many such projects. One of the attractions of Josh’s concept is its ability to be replicated across Australia to help address the shortage of social and affordable housing.’
‘I grew up in Sydney and can see that as Sydney expands, fewer and fewer people are able to find housing that they can afford’, Mr Vrsaljko added. ‘If this is to change we need a new approach to housing development, which is why I set up Sustain Community Housing.’
[1] Both SEFA and SVA’s SIF were established using funds from the Commonwealth Social Enterprise Development Investment Fund (SEDIF).
