Jordan Richardson was working as a developer in South Bend, Indiana, when the COVID-19 pandemic hit, emphasizing social disparities and highlighting the impact of a family’s social environment on their well-being and quality of life.

“I saw some things that, in my mind, were directly correlated to poverty, especially in low-income, African-American and Latino communities,” Richardson says, noting that many section 8 housing units in Southbend are unkempt and outdated. “There’s no project manager to step in when things go wrong. There’s this idea that low-income people don’t deserve nice things.”

That inspired him to bring what he calls “luxury low-income housing” to South Bend. His units are designed to be safe, affordable and high-quality. He raised money for four projects before deciding he needed more secure capital to continue. Enter: CDFI Friendly South Bend.

Smaller cities of, say, 100,000 people, aren’t always large enough to have CDFIs based in their city, but are large enough to have the problems a CDFI could alleviate. Sam Centellas, Executive Director of CDFI Friendly South Bend, serves as a matchmaker between CDFIs and South Bend entrepreneurs like Richardson. Centellas taught Richardson at Indiana University South Bend and supported Richardson’s previous business endeavors, so when Richardson needed capital, Centellas knew how to help.

“The joke that I’ve used a lot when I talk about traditional finances is: Banks are the place that will lend you money when you can prove to them that you don’t need it,” Centellas says.

Centellas introduced Richardson to Keith Broadnax, the senior VP of business development at Cinnaire, a community development-focused CDFI. Broadnax was immediately on board with Richardson’s housing vision.

“You’ll still hear me say there’s still not enough diversity between persons of color and women in real estate,” Broadnax says. “So for me being African-American, I know how hard it is to be in this space, and also how hard it is if you come from a background with limited means.”

The three of them collaborated to solidify the financial aspect of Richardson’s project, partly by working with the Housing Choice Voucher Program. One thing was clear: There’s a large demand for low-income housing units in South Bend.

“[The] local housing authority at any given time has well over 100, if not close to 200 families, that have an approved voucher and are actively seeking a place to live,” Centellas says. “For South Bend and other small Midwestern cities, there’s just an absence of stock needed for affordable housing rentals.”

While this is a problem for South Bend, smaller developers like Richardson can “become approved to be able to do Housing Choice Voucher properties, It’s guaranteed income,” explains Centellas.

The Housing Choice Voucher program subsidizes rent for tenants living in Section 8 housing. By leveraging the program, Richardson is able to prove to investors that his project will generate revenue while meeting a community need.

“He’s going to generate market-rate income off of these properties, and we know the families he’s helping aren’t going to pay market rate because it’s going to be subsidized by housing choice vouchers,” Centellas says. “It’s a win-win situation where we know Jordan is able to be profitable, while a family in our community would be able to find a place that they can afford.”

When it was time to go to Cinnaire’s loan underwriter, Broadnax helped Richardson prepare. “Some of the questions I knew they were going to ask him, like, ‘How much money do you have?’ ‘What’s your plan?’” Broadnax says. “I’m fortunate enough to have a good underwriter that asked those critical questions, but also worked with Jordan, in terms of getting everything across to our loan committee to help get him a loan.”

Cinnaire was able to give Richardson a $500,000 line of credit so he can continue to develop these projects.

“If it weren’t for Sam and CDFI Friendly South Bend, I never would have gotten in contact with Jordan,” says Broadnax, who is based in Indianapolis. “I’m not in that community or regularly, I’m usually only in there if there’s a deal for me to follow. But he has his pulse on that community.”

Richardson was able to secure the line of credit from Cinnaire thanks to creative partnerships and mentoring, which is also how he develops his properties. “I don’t have nor want employees, I want people to take pride in their work and are willing to be owners,” he says. He partners with rising entrepreneurs who work in development and restoration, giving them advice on how to see the benefits of being an entrepreneur, forming an LLC, and operating their own businesses.

“That’s what really helps build our ecosystem,” Richardson says. “We don’t only want to provide low-income housing, we want to provide people with business ideas and create ways for their families and generational wealth in areas and for people that normally wouldn’t be able to do that.”

This story is part of our series, CDFI Futures, which explores the community development finance industry through the lenses of equity, public policy and inclusive community development. The series is generously supported by Partners for the Common Good. Sign up for PCG’s CapNexus newsletter at capnexus.org.