A trio of finance and investment concerns are combining to back a $200 million investment in community housing.
Houses under construction. File photo Photo: RNZ / Dan Cook
Housing investment platform Positive Capital, investment house Alvarium and KiwiSaver provider Pathfinder are partners in Positive Property, which will put up $100m in community housing projects, with the balance being raised by housing providers largely through debt.
The providers, who are backed by long term government funding, would have the option to buy out Positive Property's 50 percent once they had repaid their debt.
Positive Capital chief executive James Palmer said the mix of equity and debt was innovative for this country and would boost impact investing, which aimed to generate financial returns while achieving social outcomes.
"This uniquely enables new homes to be built at 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. It truly is a win-win impact investment."
He said financial concerns could expect a return of 2 to 4 percent a year, and with $248 billion in investment funds in New Zealand there was scope for growth.
Alvarium Group co-chairman Andrew Williams said overseas experience showed that such finance arrangements worked on all levels.
''We are involved in similar impact investment funds in the UK and we have seen first-hand the positive difference these impact investments make to people's lives while providing our investors with a solid return."
Palmer said the intention was to find builders, material and trades suppliers, who would be involved in such projects and assist by reducing their margins.