Program Related Investments Fund Frequently Asked Questions
The San Francisco Foundation PRI program works primarily through intermediary nonprofit loan organizations. Please contact Vanitha Venugopal, program officer for community development, at 415.733.8522 or email@example.com to discuss potential PRI opportunities.
Program Related Investments (PRIs) are below-market loans to nonprofit entities and/or equity investments in for-profit affiliates of nonprofit entities that generate positive but below-market rates of return because the ultimate beneficiaries are low-income individuals and families or blighted communities, or important public benefits are created such as environmental preservation. Unlike grants, PRIs are expected to be repaid. They offer patient capital with a below-market interest rate and terms that support the goals and mission of both the borrower and the Foundation. The organization should have a strong balance sheet and revenue to repay the loan.
The Foundation will work exclusively through intermediaries or established organizations with strong balance sheets. In order to be eligible for a PRI, the prospective borrower must have either a prior track record of repaying loans or other forms of invested capital, or other forms of successful financial performance.
4. My nonprofit organization is neither a CDFI nor a lending intermediary. How can my organization apply for a PRI from The San Francisco Foundation?
Smaller nonprofit organizations should contact Vanitha Venugopal, program officer for community development, at 415.733.8522 or firstname.lastname@example.org to discuss a partnership with an eligible intermediary.
Our PRI Fund will provide working capital and term loans of up to 10 years for nonprofits and other eligible organizations aligned with our five Program areas: from affordable housing, to environmental preservation initiatives, to arts, health, and education facilities.
6. Do PRIs have to be repaid? What are the typical terms of a PRI from The San Francisco Foundation?
Yes. All PRIs must be repaid. The most common PRI is a loan from five to seven years at interest rates at or above 3%.
The Foundation will consider PRIs that meet all the following criteria:
1. The PRI must further one or more of the Foundation’s strategic goals or objectives in the following areas:
a. Facilities financing for nonprofit groups working in The San Francisco Foundation’s five Program areas: from affordable housing, to environmental preservation initiatives, to arts, health, and education facilities
b. Community development, including economic revitalization and affordable housing
c. Environmental preservation, including transit-oriented development and green buildings
2. The PRI must have the potential for repaying capital plus a minimum return of 3%. In all cases, there must be identifiable sources of repayment.
3. The PRI must catalyze or leverage capital from financial institutions and other investors into under-invested areas synergistic with The San Francisco Foundation’s priorities in the areas described above in Section 1.
4. The PRI must have the potential for significant, measurable impact, e.g., to increase the scale of impact or level of service, or to build a sustainable asset base for long term operating stability and growth.
Approximately 10% of the Foundation’s PRI portfolio will be eligible for higher risk investments and early stage investees that have the potential to significantly push innovation or lead to significant impact in an issue area central to the Foundation’s priorities.
The San Francisco Foundation’s PRI program will reflect the Foundation’s geographic focus on San Francisco, Alameda, Contra Costa, Marin, and San Mateo Counties.