The development utilizes the Low-Income Housing Tax Credit program to facilitate construction in a region where housing availability remains a primary economic challenge. Wells Fargo and Citi Community Capital are backing the project through construction financing and tax credit equity, with Citi also providing the permanent financing structure.
Safehold Backs 256-Unit Affordable Housing Project in Santa Cruz
A $45 million ground lease has been finalized for a new affordable housing community in the Soquel area of Santa Cruz, California. The project, led by developer The Pacific Companies, aims to address the significant demand for residential units in the high-cost coastal market by delivering 256 apartments by 2028.
Steve Wylder, Safehold’s Head of Investments, noted that the firm’s ground lease model is designed to bridge capital gaps created by rising interest rates and elevated building costs. This transaction marks the second recent collaboration between Safehold and the developer in the Santa Cruz area, signaling a strategic pivot toward the affordable sector to stabilize long-term project viability.
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