Investors including Nuveen, Pacific Life Insurance Company and Farmers Insurance have backed a US fund created to provide loans to borrowers seeking to preserve existing affordable multifamily properties.
Impact Community Capital, which seeks $200m (鈧�169m) for the new investment strategy, said it has so far raised $130m and has already originated the first four loans which will result in the preservation of over 480 affordable housing units.
The strategy seeks to preserve close to 5,000 affordable housing units and to provide investors access to stable income through risk-adjusted returns.
Jeff Brenner, Impact Community Capital鈥檚 president and CEO, said: 鈥淲e are proud to take this definitive action to safeguard valuable existing affordable housing.
鈥淚t will be impossible to get out in front of the crisis if we lose this critical supply of affordable homes to market-rate development.鈥�
Violet Osterberg, managing director at Pacific Life, said: 鈥淔ew investments have as much positive impact 鈥� and broad impact 鈥� on a community than access to affordable housing.
鈥淧acific Life is proud to do its part in preserving the critical supply of affordable housing that鈥檚 under threat.鈥�
Pamela West, managing director 鈥� real estate impact investing at Nuveen, said: 鈥淧reserving quality affordable housing is more than just real estate.
鈥淲hen addressed properly, institutional capital can increase quality of life and revitalize neighbourhoods by supporting residents in accessing job training, better education, transportation, and affordable healthcare.鈥�
Community Capital鈥檚 CIO Michael Lohmeier, said: 鈥淚n a tight housing market like this, it鈥檚 hard enough for owners seeking to maintain affordable housing units to compete against market-rate buyers.
鈥淲hat Impact鈥檚 short-term loan strategy does is buy them time.鈥�
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