The big picture: Microsoft has made its largest ever pledge to support housing problems in the Seattle area. $500 million will help construct more affordable housing for low-income and middle class workers throughout the region. This is the first major foray into housing by tech giants.
One of the unfortunate consequences of hosting big businesses is the crowding that comes along with them. In the Seattle, Washington area, homelessness and the working poor are problems that should not be so widespread in an area where high paying jobs are aplenty. To help rectify the situation, Microsoft is pledging $500 million to help with affordable housing within the Puget Sound area.
Microsoft's goal is to contribute to building "tens of thousands of units," according to President Brad Smith. At exactly 10,000 dwellings, that breaks down to $50,000 per residence. If Microsoft intends to reach its goal, there is a greater chance that it will extend moderate support to many projects instead of footing the entire bill for selected construction.
Funding will be split into three different pools. A $250 million allocation will target support towards low-income families earning less than $62,000 per year in the form of market-rate loans to finance construction. Another $225 million will go towards preserving and building housing for families earning up to $124,000. Although that may seem more on the end of affluent, rent averages $21,360 annually, and that is just the average. Buying a house is difficult for those that are not making a lot of money.
The remaining $25 million will be reserved for future philanthropic gestures in the region. So far, $5 million is expected to go towards legal defense efforts, co-sponsored by the Seattle Mariners baseball team, to assist tenants facing eviction. Another $5 million will be used to consolidate services for homeless residents.
This donation towards the city of Seattle marks Microsoft's largest ever pledge in company history. However, with more than $135 billion in cash and short-term investments available and excellent examples of generosity from the original founder, there is plenty of opportunity for future development as well.