Facebook CEO Mark Zuckerberg is joining other local companies and organizations to raise $500 million to help fight the San Francisco Bay Area’s housing crisis.
They are launching a new investment fund, called Partnership for the Bay’s Future, that they say will help address housing issues and try to mitigate some of the transportation challenges presented by the Bay Area’s unique geography.
In San Francisco alone, roughly 7,000 people are homeless. There is a shortage of affordable homes across the Bay Area, which is pushing out middle and low-income workers like teachers and restaurant employees. Critics say the influx of tech companies and their well-paid workers has contributed to the ongoing housing crisis.
The issue has received national attention and was a topic of major debate during the last election.
In November, voters passed the largest corporate tax increase in San Francisco’s history, an issue that pitted Salesforce CEO Marc Benioff against Twitter and Square CEO Jack Dorsey. Benioff accused Dorsey and other tech leaders who opposed the ballot measure of not giving enough back to the city where their companies are headquartered.
California Governor Gavin Newsom has also called on tech companies to do more to fight the housing crisis.
The Partnership for the Bay’s Future has already raised $260 million and is looking for more partners.
Zuckerberg’s own philanthropic organization, the Chan Zuckerberg Initiative, which he runs with his wife, Priscilla Chan, is involved in the project. So far the Chan Zuckerberg Initiative, the LISC, and Capital Impact partners have contributed $50 million each to the funds. Other groups investing in the project include Facebook, Genentech, The San Francisco Foundation and the Ford Foundation.
The group will have two funds. One will be focused on preserving existing affordable housing units and building new ones. The group will use the other fund to support policy initiatives that protect and expand affordable housing options.
The $500 million investment comes as more private tech companies are getting involved in regional housing issues. Last week, Microsoft made a pledge to invest $500 million to make homes in Seattle, where it’s based, more affordable.
Adhi Nagraj, the San Francisco director of urban planning organization SPUR, agreed that the contribution is a positive step toward developing more housing. But he told CNN Business that these laudable efforts shouldn’t take the place of money from local, state and federal governments.
“We need them to invest and not just rely on the philanthropy of private donors,” he said.
Todd David, executive director of the San Francisco Housing Action Coalition, told CNN Business the money will help alleviate one of the biggest obstacles to building affordable housing in the Bay Area: funding.
David said that two-thirds of the city is zoned for single-unit to three-unit homes, which means affordable options get concentrated in a handful of areas. When certain areas become so crowded with low-income housing, residents in more affluent areas become less willing to accept lower-income housing units in their own neighborhoods.
“For wealthy individuals to step up and fund affordable housing removes one of the significant barriers to getting it built,” he said.