In an effort to alleviate homelessness and unaffordable housing in the city that's home to its headquarters, Microsoft
The pledge has been made primarily to help 50,000 workers low- to middle-income workers who work for the tech giant.
A statement issued by the company said: "If we're going to make progress, we'll all need to work together as a community. We recognize that Microsoft is in a unique position to put the size of its balance sheet behind this effort. But we believe that every individual and every business, large and small, have a responsibility to contribute. This includes new initiatives to share data on where jobs are being created and the home locations and commuting distances for employees. It also includes new work to develop detailed public policy changes that will be needed to provide more affordable housing."
The size of the project is the largest of any pledge in Microsoft's history since the past 44 years. The funds are being split as follows: first, Microsoft will lend $225 million at lower market-interest rates to incentivize builders to develop on the Eastside and avoid high construction costs. The developments are targeted at households making between $62,000 and $124,000 per year.
The second portion of funds - roughly $250 million - will be used to dole out market-rate loans for development in the Puget Sound region. This region is made up of people who earn 60% of the local median income. Both the first and second part of the overall funds will be deployed over three years.
The rest of the money will go towards arrangements for Eastside's homeless population, including tenants facing eviction.
Microsoft president Brad Smith says, "At some level we as a region are going to need to either say there are certain areas where we're comfortable having more people live, or we just want permanently to force the people who are going to teach our kids in schools, and put out the fires in our houses and keep us alive in the hospital, to spend four hours every day getting to and from work." He also said, "That is not, in our view, the best outcome for the community."
Given that construction in the region is about 30% below historically recorded values and supply is extremely low, housing prices have skyrocketed and there is a need for some sort of subsidized residential plan. Seattle has struggled to balance rampant inequality between its homeless population and the incredible wealth of the corporations that call it home. In 2018, a planned tax on major corporations that would have funded efforts to fight homelessness collapse under opposition from giants Amazon
"What's important about [Microsoft's] effort in Seattle is that it is going toward increasing the supply of housing for those who arguably need it most," says Ralph McLaughlin, deputy chief economist at real estate data provider CoreLogic. "It is those who the private sector don't typically build homes for."