Apple on Monday said it would commit $2.5 billion to easing a housing shortage that has driven up prices across California.
As costs skyrocket for renters and potential homebuyers — and as the availability of affordable housing fails to keep pace with the region’s growth — community members like teachers, firefighters, first responders and service workers are increasingly having to make the difficult choice to leave behind the community they have long called home. Nearly 30,000 people left San Francisco between April and June of this year and homeownership in the Bay Area is at a seven-year low.
“Before the world knew the name Silicon Valley, and long before we carried technology in our pockets, Apple called this region home, and 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,” said Tim Cook, Apple’s CEO. “Affordable housing means stability and dignity, opportunity and pride. When these things fall out of reach for too many, we know the course we are on is unsustainable, and Apple is committed to being part of the solution.”
Apple says it designed its initiative to accelerate and expand new housing production; jump-start long-term developments; help first-time buyers purchase homes; and support new housing and programs to reduce homelessness. In partnership with Governor Gavin Newsom, the state of California and community-based organizations, Apple is providing a significant investment that offers statewide housing support as well as funding for projects in Silicon Valley and the Bay Area.
Apple is putting its $2.5 billion investment to use across multiple initiatives.
The $1 billion commitment to the state of California is an affordable housing fund that will provide the state and others with an open line of credit to develop and build additional new, very low- to moderate-income housing faster and at a lower cost.
Apple's $1 billion first-time homebuyer mortgage assistance fund: Working with the state, this first-time homebuyer fund will provide aspiring homebuyers with financing and down payment assistance. Apple and the state will explore strategies to increase access to first-time homeownership opportunities for essential service personnel, school employees and veterans.
Apple also intends to make available land it owns in San Jose worth approximately $300 million for the development of new affordable housing.
The funding commitment to California is expected to take approximately two years to be fully utilized depending on the availability of projects. Capital returned to Apple will be reinvested in future projects over the next five years.
In addition to these initiatives, Apple is working to identify private developers who, with the right financing and investment, are ready to start construction on affordable housing projects in the Bay Area immediately. Apple will also provide $200 million to support new lower-income housing and help some of the most vulnerable populations in the Bay Area:
$150 million Bay Area housing fund: In a public-private partnership, Apple is launching a new $150 million affordable housing fund with partners including Housing Trust Silicon Valley to support new affordable housing projects. The fund will consist of long-term forgivable loans and grants.$50 million to support vulnerable populations: Apple will donate $50 million to support Destination: Home’s efforts to address homelessness in Silicon Valley. Apple will focus its contribution on driving systemic change across the many factors affecting homelessness. Apple will also be identifying similar efforts in Northern and Southern California, focusing on strategies that both end and prevent homelessness.
One of the first projects Apple will fund as part of its philanthropic commitment to Destination: Home will be an expansion of the organization’s Homelessness Prevention System, a network of service providers offering employment assistance, legal aid, rent subsidy, case management and other support to reduce homelessness.
By putting its $2.5 billion investment to use across multiple initiatives and partners, Apple’s housing initiative offers a comprehensive and multi-pronged approach to address some of the most urgent challenges facing affordable housing in California. This initiative is a major step, and Apple will continue looking for ways to support communities and affordable housing.
Apple's move comes after Facebook and Alphabet's Google both committed $1 billion toward California housing initiatives while Microsoft committed $500 million in the Seattle, Washington area.