A trio of financial and investment concerns combine to support a $200 million investment in community housing.
Housing investment platform Positive Capital, investment house Alvarium and KiwiSaver provider Pathfinder are partners in Positive Property, which will invest $100 million in community housing projects, with the balance raised by providers of housing largely on loan.
The suppliers, who are backed by long-term government funding, would have the option of buying out Positive Property’s 50% once they have paid off their debt.
Positive Capital Managing Director James Palmer said the combination of equity and debt was innovative for this country and would spur impact investing, which aimed to generate financial returns while achieving social outcomes.
“This uniquely allows new homes to be built on a large scale while growing the asset base of charities committed to providing affordable housing for generations to come.”
“Investors receive market returns for their equity investment, secured by long-term government funding, with homes co-owned and managed by community housing providers. This is truly a winning impact investment. -winner.”
He said financial concerns could expect a return of 2-4% a year and that with $248 billion in investment funds in New Zealand there was room for growth.
Alvarium Group co-chairman Andrew Williams said overseas experience showed such funding arrangements worked at all levels.
“We are involved with similar impact investing funds in the UK and have seen firsthand the positive difference these impact investments make in people’s lives while providing our investors with a solid return.”
Palmer said the intention was to find builders, material suppliers and trades, who would be involved in such projects and help by reducing their margins.