As the strain on the economy continues amid the ongoing COVID-19 crisis, the need for affordable housing continues to grow. In the challenging environment faced in the past three months, IMPACT Community Capital financed 1,654 units of affordable housing through a mix of 19 new loan purchases and forward commitments totaling more than $69 million. Also in the third quarter, IMPACT partnered with Freddie Mac to issue their first social bonds, continuing IMPACT's mission to transform communities by creating scalable institutional-quality investments.
The third quarter financings included properties like the Ashtabula Towers. This 202-unit property in Ashtabula, Ohio, of which 200 units are covered by Section 8 contracts, is being repositioned and recapitalized through HUD’s 223(f) program. The development’s acquisition is being financed with the help of a short-term bridge loan from IMPACT, part of our new program focused on preserving affordable housing.
"In the current, uneven economic recovery, low-income families and underserved communities bear the brunt of the hardship. It’s imperative that IMPACT continues to finance the development and preservation of affordable housing," said Michael Lohmeier, IMPACT’s Chief Investment Officer. "We are glad that we’ve been able to continue to do that during this difficult year."
IMPACT seeks to address the needs of a variety of underserved communities throughout the country. In Sunny Isles Beach, Florida, for instance, IMPACT helped with the acquisition and rehabilitation of Marian Towers, a 225-unit building dedicated to seniors 62 and older. The property — owned by Catholic Health Services (CHS), an affiliate of the Archdiocese of Miami, and financed in partnership with Wells Fargo — has 194 Section 8 units, with the remaining apartments serving residents with incomes at or below 60% of area median income.
Additionally, IMPACT, through a partnership with JP Morgan Chase helped finance RST The Pines, a new construction 100-unit LIHTC development targeting families in DeLand, Florida. All units will target residents with incomes at or below 60% of area median income, with five designated for residents with disabilities or special needs.
Also during the third quarter, IMPACT partnered with Freddie Mac in its first Social Bond issuance, which totaled $106 million and financed 4,585 affordable housing units through the underlying participation certificates. The issuance received over $414 million in orders from 13 separate investors across asset management, insurance and ESG-focused buyers. These bonds were also the first in the structured product market to be labeled as Social Bonds through a second party opinion from Sustainalytics. IMPACT greatly valued this opportunity to work with Freddie Mac to provide additional capital to our communities and liquidity to investors.
IMPACT believes access to affordable housing is the bedrock for building healthy neighborhoods and economically vibrant communities in all locations. Over the past two decades, IMPACT has helped originate approximately $2 billion in institutional-quality investments to finance the creation of more than 48,000 affordable housing units —without sacrificing investment quality.
*Past performance is not indicative of future results. Investors are subject to the risk of loss.
Founded in 1998 by leading insurance companies to generate institutional-quality, purpose-driven investments, IMPACT Community Capital is a pioneer in impact investing and was among the first to use securitization to deliver capital in scale for affordable housing. The firm has now originated $2 billion investments to provide affordable housing, healthcare, childcare and economic opportunities. IMPACT looks to guide new investors seeking to unleash the power of capital to transform communities without compromising investment quality. For more information: impactcapital.net.
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