Apple has said it will contribute $2.5 billion in value to creating affordable homes and helping vulnerable communities in Silicon Valley, joining a growing list of local tech titans trying to help tackle the state’s housing crisis.
The announcement, made Monday morning, promises a slew of new programs, including setting aside land in San Jose for new homes, creating mechanisms to help first-time homeowners across the state and giving loans and grants to nonprofit and for-profit developers to build new homes, as well as expanding local homelessness services.
Apple, one of the richest companies in the world, recently finished construction on a nearly 3 million-square-foot campus in its longtime hometown of Cupertino. As a company, it has long pushed back on the concept of offering new community benefits outside of paying its sizable tax bill.
But now the mammoth tech giant has just put forth the largest voluntary housing promise in the region.
“Before the world knew the name Silicon Valley, and long before we carried technology in our pockets, Apple called this region home,” Tim Cook, Apple’s CEO, said in a statement Monday. “We feel a profound civic responsibility to ensure it remains a vibrant place where people can live, have a family and contribute to the community.”
Many questions remain about how exactly Apple will unfurl its massive contribution. For now, the company has offered some details, including that it will “make available” $300 million of Apple-owned land in San Jose for new affordable housing developments. Notably, the company doesn’t say that it will develop those homes, which is a similar tack that Mountain View-based Google is taking through its own affordable housing contribution in cities across the Bay Area.
Apple will also create two new $1 billion funds: one for affordable housing investment to developers building very low- to moderate-income housing, and another to assist first-time homebuyers in the state with their down payments and financing. The company says it’ll work with the state in its new homebuyer mortgage assistance fund to target service workers, school employees and veterans.
“This unparalleled financial commitment to affordable housing, and the innovative strategies at the heart of this initiative, are proof that Apple is serious about solving this issue. I hope other companies follow their lead,” Gov. Gavin Newsom said in a statement Monday. “The sky-high cost of housing — both for homeowners and renters — is the defining quality-of-life concern for millions of families across this state, one that can only be fixed by building more housing. This partnership with Apple will allow the state of California to do just that.”
The final $200 million of the promised housing contribution will go to a pair of local nonprofits, Destination: Home and the Housing Trust Silicon Valley.
Destination: Home, which has helped house nearly 8,000 people in the past 4.5 years, will get the final $50 million to expand its existing efforts to reduce homelessness in the region.
“For every person or family we connect to permanent housing, (two to three times) more are becoming homeless for the first time,” said Jennifer Loving, chief executive officer of Destination: Home. “This contribution will help us combat this trend by accelerating the construction of more deeply affordable housing and prevent more families from becoming homeless.”
The Housing Trust, meanwhile, will launch a new $150 million fund in partnership with Apple to provide forgivable loans and grants. The new pot of money will spur “thousands of new homes,” throughout the Bay Area, according to Kevin Zwick, chief executive officer of the Housing Trust.
“As the leading nonprofit lender in the greater Bay Area we know what kind of a difference this long term, gap financing will make in the creation of more affordable housing,” Zwick said. “We also know first-hand the positive difference a safe, stable and affordable home can make for everyone who calls this region home.”
The announcement comes after both Google and Facebook this year have announced their own housing commitments, both offering up $1 billion in value between cash and company-owned land in the region.
In June, Google was the first to announce it’s $1 billion contribution that would include $750 million in land value and $250 million in grants and other investments. It’s contributions will be targeted in the cities where it is growing the most: San Francisco, Sunnyvale, Mountain View and San Jose.
Facebook last month followed suit by announcing it’s $1 billion housing commitment, in which it aims to partner with the state of California and San Mateo and Santa Clara counties to help fund housing on publicly-owned land. The social media giant will also set aside some of its own property in Menlo Park for housing and partner with The Partnership for the Bay’s Future to create a new investment fund.
Apple’s announcement, alongside other major tech company’s housing promises, shows “everyday workers, such as teachers, janitors firefighters and construction workers, are being heard,” said Derecka Mehrens, executive director of Working Partnerships USA and Silicon Valley Rising co-founder.
“The unprecedented growth of wealthy tech corporations has pushed housing costs through the roof for everyday people in large parts of California and the result has been huge increases in homelessness and housing instability,” she said. “It’s crucial that these companies recognize their responsibility to address the housing needs they have created in communities they call home.”
Contact Janice Bitters at [email protected] or follow @JaniceBitters on Twitter.
Editor’s note: Destination: Home Executive Director Jennifer Loving and Working Partnerships USA Executive Director Derecka Mehrens serve on San José Spotlight’s Board of Directors.