As part of his ambitious bid to tackle Boston’s housing crunch, Mayor Martin J. Walsh is looking for help from a new source: the business community.
Walsh has started making pitches to major companies and foundations in the city on the idea of pooling their money — perhaps as much as $100 million — to help finance affordable housing in Boston.
Discussions are still in the early stages, with another meeting scheduled for this month. But if the idea comes to fruition, it could make Boston the first East Coast city to adopt a strategy that cities and corporations are experimenting with out West, where technology companies are putting up millions of dollars to combat a housing crisis that many critics say they helped create.
Walsh’s effort was born out of his October speech to the Greater Boston Chamber of Commerce, in which he urged business leaders to do more to encourage the construction of middle-class housing. The idea came into sharper focus Tuesday during his State of the City address, when the mayor pledged $500 million in new spending over the next five years on a variety of affordable-housing programs.
One, his aides said, would provide seed money for a largely private fund to help acquire and finance affordable housing.
“It’s not going to solve everything,” said Walsh’s housing chief, Sheila Dillon. “But it could be a good resource.”
The concept is loosely modeled on similar efforts in expensive West Coast housing markets.
Early last year, a collection of big companies and foundations in the San Francisco Bay Area pledged $540 million to help lower that region’s crippling housing costs. They were later joined by tech giants Google and Facebook which each promised $1 billion in land and low-cost financing to help build housing.
Some have criticized those efforts as too little, too late, given that the exploding tech industry, in particular, has reshaped housing markets in those cities by attracting many thousands of employees, driving up rents and home prices as a result.
Others have noted that most of the funding comes in the form of loans and land sales — profitable for the companies themselves — and not as grants.
Regardless, the funding programs are beginning to bear fruit.
In September, Microsoft put up $60 million to help a Seattle-area housing authority purchase several housing developments and keep rents low. A month later, ground was broken on an affordable housing project in Berkeley, Calif., that was financed by a corporate partnership.
Efforts here are nowhere near that stage.
Following Walsh’s chamber speech last fall, he and Dillon talked with the chamber’s president, Jim Rooney, and several of the city’s larger employers about how best to approach housing. The notion of starting a fund came up.
“The idea of a fund or housing trust was talked about,” Rooney said. “Beyond that, there’s been no decision to do anything specific.”
A more formal sit-down with some of the major companies to explore the idea — including which ones might contribute, what a fund might pay for, and how it would function — is scheduled for later this month.
Dillon said the Walsh administration would like to be able to seed the fund with some of its own resources, perhaps from a 2 percent tax on high-end real estate sales. The city recently sent such a proposal, in the form of a home rule petition, to the Legislature, whose approval would be needed.
Dillon said the amount of seed money has not been determined, “but it needs to be sizable to signal to the business community that we’re serious.”
While many details remain to be worked out, Rooney said he expects that businesses would be receptive to Walsh’s idea. For many companies, Greater Boston’s high housings costs are a growing worry, especially when it comes to hiring and retaining workers who may struggle to afford living here.
“Our competitive advantage as a region is our workforce and our talent,” Rooney said. “We need people who want to stay here, who want to come here, and who can afford to do so. Issues like cost and availability of housing are really key to that.”