Fannie Mae Foundation in DC Housing Market Closes Doors
The Fannie Mae Foundation, which since 1979 has spent more than $1 billion to increase the supply of affordable homes nationwide and improve the quality of life in D.C., is shutting down.
The foundation’s sole funder, D.C.-based home mortgage financing giant Fannie Mae, is consolidating its philanthropic efforts into a new office of community and charitable giving. The new office will be part of Fannie Mae, while the foundation was a separate entity.
The foundation will close down the bulk of its operations by April 30; at that time the majority of its 60-person staff will be laid off. Fannie Mae spokeswoman Christina McHenry says some of these individuals may end up working for the new office.Washington Business Journal reported in May 2006 that the foundation, consistently one of the area’s most generous corporate philanthropies, was running out of money, hurt by Fannie Mae’s roughly $10 billion earnings restatement.
In the past 10 years Fannie Mae had pumped nearly $764 million into the home loan foundation, mostly in the form of corporate stock. But Fannie Mae’s stock has been hurt since news of its accounting troubles surfaced in the fall of 2004, squeezing the foundation’s finances and casting into doubt its ability to remain one of the region’s major corporate givers.
The new office will direct its support toward three areas:
- Building thriving neighborhoods in the D.C. housing market through investments in housing, education and homelessness.
- Addressing the nation’s housing challenges through housing and community development initiatives.
- Advancing efforts to end homelessness in America.
“This effort is part of the overall re-evaluation and restructuring the company is undertaking, and embraces our core principles of service, reliability and value,” says Fannie Mae President and CEO Daniel Mudd in a statement.
For 2007, philanthropic grants and projects will be funded through a combination of the foundation and company resources as the foundation begins to close down.
Establishing the new office allows Fannie Mae to “speak with one voice,” McHenry says. “We will create more comprehensive partnerships and … grow our commitment to the District.”