Michigan Community Capital

investing in places where people come first

Mission

Michigan Community Capital is a US Treasury Certified CDFI and CDE and is a public private partnership which fosters investment in disadvantaged communities, including rural communities and communities of color by providing loans, equity investments and direct development and development support. Our financial and community development tools help disadvantaged people and communities eliminate blight, provide safe and attractive affordable housing and revitalize downtown districts in Michigan devastated by disinvestment. We partner with banks under the CRA, philanthropy, federal, state and local governments to tackle problems and projects previously unsolvable. We are an irs supporting organization to the Michigan Economic Development Corporation and the MI State Housing Development Auth.

Ruling year info

2004

President & CEO

Eric Hanna

Main address

507 S Grand Ave

Lansing, MI 48933 USA

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EIN

33-1068719

NTEE code info

Economic Development (S30)

IRS filing requirement

This organization is required to file an IRS Form 990 or 990-EZ.

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Communication

Programs and results

What we aim to solve

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Our programs

SOURCE: Self-reported by organization

What are the organization's current programs, how do they measure success, and who do the programs serve?

Affordable Insurance Program

MCC formed an 831b micro-captive insurance company to stabilize and lower the highly volatile cost of property insurance among low-income and public housing developments. When developers and owners participate in the program MCC's insurance company takes a portion of the risk and uses bulk buying power and geographic and construction type diversification to drive higher attachment points and lower premiums. The result of this is the elimination of 10%-25% swings in insurance costs for predominantly affordable housing assets. This is important because the properties make very little cashflow and developers frequently can not control the cost of insurance, which can create loan defaults or cash calls and even delay critical maintinance in extremes cases. MCC clients average a steady flat-2% increase annually which stabilizes year over year budgeting.

Population(s) Served
Social and economic status

MCC provides loans to commercial real estate and affordable housing projects that have transformative impacts in communities. These projects are typically loss-leading and designed to catalyze private sector development. MCC will make loans that are not necessarily tied to Loan to Values but are instead sized to the ability of a project to repay. Loans frequently clean up blight and brownfield conditions and address issues of environmental justice in LMI communities. We frequently lend in projects where we also commit our New Market Tax Credits.

Population(s) Served
Social and economic status

MCC, through our subsidiary Magnet Development Company (MDC), is a full service commercial real estate developer and property manager of mixed-use, mixed-income workforce and affordable housing. MDC also builds starter homes in affordable price brackets, typically 80% of the AMI or below, and provides for long term affordability through resale restrictions, CLT's or other means. MDC also connects affordable buyers with housing counseling and down payment support. MDC is a developer of last resort, often tackling problem sites where other developers fail. All projects receive state and local support and most originate from LMI / Low/Mod Communities, DDA's or City Commissions.

Population(s) Served
Social and economic status

MCC is a US Treasury certified CDE and repeat NMTC allocatee. MCC sub-allocates it's awarded tax credits to both accessible job creating projects and to community development projects which support the intersection of housing, healthy access to food, and access to living wage jobs. When projects combine to create multiple bottom lines they can become financially challenging but also valuable long-term community assets. MCC allocates exclusively to projects in the State of Michigan.

Population(s) Served
Social and economic status
Age groups
Ethnic and racial groups
Health

Where we work

Our Sustainable Development Goals

SOURCE: Self-reported by organization

Learn more about Sustainable Development Goals.

Goals & Strategy

SOURCE: Self-reported by organization

Learn about the organization's key goals, strategies, capabilities, and progress.

Charting impact

Four powerful questions that require reflection about what really matters - results.

MCC aims to meet communities where they are and to break the cycle of systemic disinvestment. Because each community has slightly different needs and challenges and because we serve all communities in Michigan we maintain significant organizational flexibility. From addressing contamination to a lack of lower and middle income housing, to a lack of activity and safety due to poor occupancy in a communities downtown...regardless of the problems we take them on. Our process begins by attempting to use the least intensive tools including partnership building, education and community organizing to achieve consensus. If solutions through partnership fail to materialize with sufficient capacity, MCC brings highly flexible loans from our unregulated loan fund to the table as well as our affordable insurance program. In the case where the private sector can not be activated or engaged to help solve the problem initially, MCC can go as far as purchasing, developing and managing housing, mixed use, industrial and neighborhood service organization projects. We support small businesses, grocery stores, co-ops and attainable and affordable housing at whatever level of need they have in order to thrive. There is no simple solution do decades of disinvestment and Michigan's highly cyclical economy. Flexibility and creativity are required and that is what we bring to the table.

Our process is simple. 1) Achieve consensus about the problem and it's root causes. 2) Engage with the private sector and government as a match maker and in some cases as a financial conduit to bring collaborative resources together. 3) If resources remain scarce utilize our fundraising capacity and flexible capital combined with our highly skilled operating experience in real estate to take a loss-leading position in the community in an effort to pave the way for other projects in the future.

Following these three simple steps we ensure that we are always leading with community engagement and consensus which we feel is critical to solving complex socio-economic disinvestment problems.

MCC brings deep experience in community engagement, complex project finance skills, insurance risk management, federal, state and local capitalization vehicle asset maps and fundraising and fund development expertise to the table. In addition, our team can take troubled assets and restructure them and operate them as a long hold investment with over 2 decades of experience at our senior staff level. MCC also has a strong balance sheet, close partnerships with banks and critical state agencies and has historically been successful with a number of competitive federal programs. This combined experience allows our relatively small organization to achieve outsized operational results.

MCC has fostered over $1B in projects in it's first 14 years. At any time MCC has between $25 and $50 Million dollars in project value under construction, restructuring or redevelopment. We work aggressively to the maximum extent our balance sheet allows to address inequity and disinvestment in low and moderate income areas of Michigan. In markets where MCC has delivered product we see follow on investment, an easing of housing scarcity a boost in tax base and housing quality and increased employment opportunities. Our work is fundamentally limited by the level of grant funds and retained earnings we can amass since our capital partners in the banking community must limit their lending to us if our Net Assets run below 20% on a global basis. Securing both restricted and unrestricted grants which boost net assets is the single biggest factor in our ability to leverage additional capital and facilitate more projects. MCC is currently carrying a 5 year pipeline which is constrained by a lack of grants facilitating our Net Asset Ratios.

Financials

Michigan Community Capital
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Operations

The people, governance practices, and partners that make the organization tick.

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Michigan Community Capital

Board of directors
as of 6/18/2021
SOURCE: Self-reported by organization
Board chair

Mr. Mark Morante

Retired Sr. Executive Vice President of the MEDC

Term: 2015 -

Organizational demographics

SOURCE: Self-reported; last updated 06/07/2021

Who works and leads organizations that serve our diverse communities? GuideStar partnered on this section with CHANGE Philanthropy and Equity in the Center.

Leadership

The organization's leader identifies as:

Race & ethnicity
White/Caucasian/European
Gender identity
Male, Not transgender (cisgender)
Sexual orientation
Heterosexual or Straight
Disability status
Person without a disability

Race & ethnicity

No data

Gender identity

No data

 

No data

Sexual orientation

No data

Disability

No data