GroundBreak Announces $1B toward Equity, Opportunity

GroundBreak, a coalition of over 40 philanthropic, private and public institutions, has announced an early collective financial commitment of nearly $1 billion to expand wealth building opportunities to create a more equitable Minneapolis-St. Paul region. Their work focuses on reaching aspiring Black homeowners, entrepreneurs and commercial developers.  

“At a time when the Minnesota Legislature has made historic investments in housing, it’s great to see the private sector Go Big as well,” says Minnesota Housing Commissioner Jennifer Ho, who has made “Going Big So Everyone Can Go Home” her mantra. 

GroundBreak, launched in May 2022, aims to transform financial systems through a nation-leading effort to expand opportunity and shared prosperity. Unlike a traditional joint fund, GroundBreak is working to fundamentally change how capital flows within a region, building on proven financial tools and strategies, deep collaboration across philanthropic, financial, corporate and public institutions, and collective investments. GroundBreak’s financial commitment includes both flexible capital and lending and is a significant step towards GroundBreak’s goal of mobilizing $5.3 billion over the next decade to equitably expand wealth-building through an innovative approach shaped by community members. 

In 2022, over 170 individuals and 120 organizations, including leaders at Minnesota Housing, participated in a six-month design process to identify financial tools and products that could help close racial wealth gaps in Minneapolis-St. Paul. As the coalition works on wealth-building strategies, it has focused on the experience of Black wealth builders who face some of the starkest wealth disparities. 

“U.S. Bank is incredibly proud to call the Twin Cities our home. We are strong believers that it is our civic responsibility to create a more equitable and prosperous environment in our community where all can thrive,” said Tim Welsh, vice chair, Consumer and Business Banking at U.S. Bank.  

First-generation downpayment and mortgage assistance through Minnesota Housing 

At the event, Welsh and other leaders discussed the coalition’s work on homeownership. Early opportunities emerged for the group after the state’s historic legislative session where lawmakers invested over $1.3 billion in housing. Approximately $175 million in state funding for first-generation homebuyers along with Minnesota Housing mortgage lending can be harnessed to advance GroundBreak’s goals. 

 Specifically, Minnesota Housing will launch a First-Generation Homebuyer program in 2024 using $50 million in newly allocated funds from the state legislature. The funds will be paired with the Agency’s downpayment assistance loan programs to bring homeownership within reach for more Minnesotans. The legislature also provided $100 million in a similar First-Generation Homebuyer program that will be administered by Midwest Minnesota Community Development Corp. Both programs dovetail well with GroundBreak’s focus on building wealth for Black households.

Today, Minnesota is ranked sixth worst in the nation for its racial wealth disparities, despite its relative prosperity and high average incomes. These disparities can be traced to policies and practices that have extracted and limited wealth-building opportunities, including generational wealth transfers through homeownership. Approximately 77% of white households are homeowners in Minnesota today. In contrast, 29% of Black households in Minnesota own their own home, and that figure is 21% in Minneapolis. This has not always been the story. In 1950, 46% of Black households in Minnesota were homeowners.  

The coalition’s $926.75 million financial commitment was pledged by 10 institutions: Bremer Bank, Bush Foundation, GHR Foundation, Huntington Bank, M.A. Mortenson Companies Inc., Margaret A. Cargill Philanthropies, McKnight Foundation, Pohlad Foundation, Securian Financial and U.S. Bank. Commitments will be spread across three- to 10-year terms. 

“GroundBreak’s nearly $1 billion commitment is a recognition that we can accomplish more when we collaborate and work together,” said Governor Tim Walz. “I’m proud of this nation-leading effort to expand economic opportunities for more Minnesotans and applaud this investment.” 

For more information about the $1 billion commitment, visit the GroundBreak Coalition. 

Learn more about Minnesota Housing’s homeownership programs.