What if philanthropy could build housing differently?
In 2023, Tim Szarnicki wrote a brief entitled, "Civic Viability--the return on altruistic investment" arguing for a new capital class that looked to achieve altruistic returns over market rate returns. As he worked to finance The Affordability Project's inaugural project at 5250 3rd Street, he saw that middle-income earners (80-130% AMI) were not able to pay enough for housing to meet market rate returns on debt and equity. Additionally, all the traditional incentives that make affordable housing viable in the forms of tax credits, subsidies, and tax exemptions are designed mainly for projects built for people earring incomes of 80% AMI and below. Since publishing the brief, it seems the tides are turning towards The Affordability Project's mission and focus. Are we entering a period where capital is open to a return that is not primarily financial? Are we seeing a willingness to invest with the intent of bolstering civic renewal and vitality? We believe so.
On August 4th, 2026, The San Francisco Chronicle, in this article. reported JPMorgan’s $200M bet on housing in San Francisco.
The article mentions the Essential Housing Fund, a private investment vehicle focused on workforce housing run by Fifth Space. Crankstart, one of The Affordability Project's key partners, was one of the first investors. Missy Narula, CEO of Crankstart, explains the fund saying, “the fund was not designed for investors seeking outsized returns: Its goal is to demonstrate that housing serving the city’s middle class can also be a viable investment.” She added, “If you care about building the kind of housing that will house the people who sustain our city, it’s a great investment.”
We are honored to partner with people on the cutting edge of thinking about innovative capital. Business as usual works for what it is designed to do. But business as usual, on its own, has not produced affordability at the scale the shortage demands. If it could, the gap would not be three to four million homes. Unless we are willing to add an option. Not a replacement for the market. A complement to it. A Conscious Capital option earns a place only if it competes on quality and on business fundamentals, and only if its ambition matches the size of the problem. It requires philanthropists, social impact investors, and mission-aligned landowners, developers, and contractors willing to build a different model together. Keep an eye out for what The Affordability Project is doing to offer opportunities for our community to participate in this new capital market.
Fundamentally, we believe housing has become unaffordable because of capital market failures. When the cost of capital is associated with maximizing returns, the middle-income earner cannot pay enough to achieve traditional expected returns. Our approach is similar to Wal-Mart's strategy: negotiate hard to drive down costs, pass the cost savings to consumer, and then focus on volume. The Affordability Project, a 501(c)(3) organization, is not interested in developer fees or maximizing individual deal returns, we are focused on our mission to increase the long-term supply of housing for the people who ensure our communities' civic and economic vitality.
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