Furthering the Bank's commitment to be part of the solution for the affordable housing crisis on Martha's Vineyard, MV Future Financing began in 2019 as an initiative with Island Housing Trust to provide low-cost loans to develop housing for low-to-mid income Martha's Vineyard residents. Effectively, MV Future Financing is a "Participation Loan," where individual donors may contribute to a particular project and invest in permanently affordable workforce housing. It is not a 100-percent banking loan - the Bank has a piece of the loan - but other donors also contribute to the purchase. Martha's Vineyard Bank acts as the lead lender, escrow agent, and loan servicer for each participant in the loan.
Financial Innovation with a Heart
from Island Housing Trust
One project was the Hanover House, which addressed Martha's Vineyard Hospital's difficulty with getting and retaining qualified staff. Investors were invited to participate in a $1.8 million below-market-rate 10-year loan (with a 2.5% return) to be used for year-round hospital employee housing. The Hanover House is a former 16-bedroom inn that Island Housing Trust had recently renovated and repurposed in Vineyard Haven.
"The ability for an individual, as a social impact investor, to be able to participate in a larger loan - as in the case of the Hanover House with $1.8 million financing - enables the individuals to have that mechanism available to them to be aggregated with other social impact investors," said James M. Anthony, President & CEO of Martha's Vineyard Bank. "As a group, they are able to meet the $1.8 million need by purchasing a portion of that loan at a level that's in line with their desire, ability, and dedication to the mission."
Martha's Vineyard Bank welcomes such innovative projects and takes pride in finding unique solutions that help solve problems.