Austin is set to receive a significant financial boost of $6.4 million from Airbnb as part of a newly launched accelerator program aimed at enhancing affordable housing initiatives. This makes Austin the first city in the nation to benefit from this initiative by the short-term rental giant.
Council Member José “Chito” Vela confirmed that the funding will directly support the St. Johns redevelopment project in North Austin, which is designed to transform a 19-acre area into a mixed-use property featuring over 500 housing units, including a portion designated as affordable housing.
Vela highlighted that Airbnb’s investment is crucial for bridging a substantial funding gap that has hindered the progress of such projects. The accelerator program, unveiled on Monday, represents a commitment of $250 million nationwide, focusing on what the company refers to as “last-dollar financing.”
Brian Chesky, co-founder and CEO of Airbnb, explained that the program targets projects that have encountered financial difficulties. “There are approximately 750,000 homes or housing developments poised to be constructed, but they require last-dollar funding. Securing this final financial support would enable the construction of those units,” Chesky stated.
The announcement of this funding comes at a time when Austin is actively pursuing its affordable housing objectives. In 2017, the city set an ambitious target to build 135,000 new apartments over the course of a decade, with around half earmarked for families earning no more than $65,000 annually.
Vela expressed optimism that this funding would propel the city closer to its goals. “Many projects encounter gaps that prevent construction from commencing. A fund dedicated to closing these financial gaps for affordable housing is an outstanding concept,” he noted.
He clarified that Airbnb will not receive any incentives or special deals from the city as part of this initiative. Following the implementation of stricter regulations for short-term rental operators in Austin last year, those rules will remain in effect.
Vela emphasized the importance of collaboration, stating, “The city cannot tackle this challenge alone. We need the support of our business partners, affordable housing advocates, and philanthropic organizations.”
Thelma Williams, a long-time resident of St. Johns, echoed the need for investment in the community, advocating for increased housing options for younger families. “Young people are truly struggling to find affordable housing that allows them to thrive,” Williams remarked.
Construction on the St. Johns project commenced earlier this summer, with an anticipated completion date set for 2028.
