Social impact investing is gaining momentum in the multifamily market.
(NREI Article ) — Can you make a profit and make a difference at the same time? According to Bobby Turner, founder of Turner Impact Capital LLC, the answer is yes. “By combining the goals of profit and purpose, social impact investing generates superior risk-adjusted returns when compared to conventional investment strategies while instilling much-needed hope in American communities,” says Turner.
While the term “social impact investing” is relatively new, the size of the impact investing market is substantial — as much as $114 billion — with significant potential for growth, according to Global Impact Investing Network (GIIN). And, as a growing percentage of the nation’s 43 million renters find it difficult to afford a place to live, impact investors are getting involved in the multifamily market.
Turner Impact Capital takes a holistic approach to impact investing that addresses not just housing affordability but other related community needs, by building high quality charter schools and health care facilities that support the same communities where they acquire and enrich workforce housing.
For example, when it purchased Regency Pointe, a nearly 600-unit property located in greater suburban Washington, D.C., they preserved the rent affordability of the units, leveraging an innovative financing solution from Freddie Mac Multifamily.
Then, they went beyond preserving rental affordability by setting aside a percentage of units at further reduced rents for people who volunteer their professional skills to the community. The property now offers a free student tutoring lounge staffed by teacher residents, free access to a nurse practitioner who lives on-site, and a community safety program headed up by police officers who live in the apartment community.
“Not only does this increase the sense of community among residents,” adds Turner, “Just as important, it’s a smart result that drives down renter turnover and lowers property insurance — while supporting the property’s profitability.”
Social impact investing is gaining momentum as it achieves positive returns, like this, for preserving workforce rental housing affordability. To support social impact investors, Freddie Mac Multifamily has stepped up to provide innovative financing solutions that help investors achieve both their social and financial goals.
“We are proud to be supporting social impact investing with fresh thinking and flexible solutions that deliver returns and help tackle the workforce housing crisis,” said Lauren Garren, Freddie Mac vice president of Production and Sales.
Learn more about Freddie Mac’s social impact financing and other innovative multifamily financing solutions.