Microsoft To Loan $500M For Affordable Housing In Puget Sound

REDMOND, WA - Microsoft on Wednesday said it would offer up to $500 million in low-interest loans to help build affordable housing in the greater Seattle area. The tech giant's pledge was backed by promises from nine local mayors to pursue zoning changes to speed the construction of housing.

Seattle Mayor Jenny Durkan was absent from the group, but the mayors of Auburn, Bellevue, Federal Way, Issaquah, Kent, Kirkland, Redmond, Renton, and Sammamish will "consider changes in zoning to increase the pipeline of housing in selected areas, providing desirable public land near transit locations, addressing permitting processes and fees, and creating tax incentives for developers," according to a Microsoft news release.

The Seattle City Council just began to parse the Ed Murray-era Mandatory Housing Affordability plan (MHA), which would allow apartment buildings to be built in a few single-family zones across the city.

Microsoft's $500 million pledge will be split into two different programs. Microsoft will loan $225 million at below-market returns to developers to preserve and develop new middle-income housing in Eastside cities. Another $250 million in low-interest loans will go to developers building low-income housing across King County.

Microsoft will give an additional $25 million in grants to organizations that address homelessness.

Along with the announcement, Microsoft released a study of the region's affordable housing crisis. The company estimates the region needs about 305,000 affordable units - both rentals and housing for sale - to meet demand. About half of that affordable housing needs to be built in Seattle.

And while jobs have grown 21 percent since 2011, the analysis said, only high-earning households have seen meaningful pay increases. Middle-income household earnings have grown just 1 percent since 2011, and low-income household earnings actually dropped 7 percent over that period.

High-paying tech jobs have contributed to that gap - and Microsoft, with thousands of highly paid employees across Puget Sound, appeared to acknowledge that fact on Wednesday.

"Ultimately, a healthy business needs to be part of a healthy community. And a healthy community must have housing within the economic reach of every part of the community, including the many dedicated people who provide the vital services on which we all rely," President Brad Smith and Chief Financial Officer Amy Hood wrote in a blog post about the affordable housing investment.

Patch file photo