$50 million fund aims to spur more affordable housing in Mass.

Underrepresented developers will soon have access to a $50 million fund to help build more affordable housing in the state.

MassHousing, a quasi-public agency, and the nonprofit Massachusetts Housing Investment Corporation (MHIC) have partnered on the fund, which they say is the largest publicly-led financing program of its kind in the country.

Housing production in the state has not kept up with demand, which has helped push housing prices and rents to among the highest in the country. As the state grapples with this affordable housing crisis, the new "Equitable Developers Fund" aims to increase and diversify the pool of developers that can build such housing.

A report released last year found Black real estate developers represent 0.4% of the industry, while Hispanic developers represent 0.16% of the industry.

"We have a housing shortage, period. And we have to figure out how to solve that housing shortage," Massachusetts Housing Investment Corporation CEO Moddie Turay said.

The new fund will provide loans to developers from socially and economically disadvantaged backgrounds. Access to capital is often a major barrier for these developers, according to Turay. It can be costly to build affordable housing, which often makes it harder for developers of color to enter that space, he said.

"This fund in a real and meaningful way arms them, if you will, gives them the agency to go into their communities and actually start to develop in their backyards," Turay said.

The program's organizers also plan to provide technical assistance to help developers "navigate the complexity of affordable housing," he said.

The fund was created after MassHousing conducted a statewide listening tour to understand the challenges developers face and figure out ways to increase participation in the development of affordable housing. The $50 million comes from the state. The organizations hope to raise an additional $25 million from private investors.

Applications for funding are expected to open this spring.