Sunday, December 15, 2019

Impact investing in Social Housing: An Asset Owner & Landlord Prospective

Last month I was on a panel at a seminar on "social impact investing" in property. In my capacity as a pension trustee seeking long term financial returns and as the lead member for Housing in a Council with a desperate housing crisis. 

While the primary objective for any pension fund investment must be to pay pensioners their money when they retire. Full stop. If at the same time a social good or impact can be achieved that pension scheme members are likely to support and does not have a determental impact on the financial returns then that is surely win, win?  

The Newham Council pension fund (for its staff) has £1.5 billion in assets and as part of its investment mix needs assets which are relatively safe, stable and inflation linked. So we have been actively looking for some time for investing in social housing to achieve our income requirements and also a positive social impact. 

At the same time we have 27,000 residents on our Council housing waiting list and over 5000 families in often expensive temporary accommodation. A number of investors including large pension funds have made "pitches" to Newham about building or buying homes then leasing them back to us for temporary accommodation. These will be cheaper than private sector "nightly paid" accommodation and better quality. So, if these proposals make financial sense this should be "win, win" as well. 

The Pension fund (which is run separately to the Council) and Newham Council is actively considering these different proposals and we have also put a capital growth bid in this years budget to buy property. 

Following the General Election last week we will all have to raise our game. 

Below is a video promo for the event. There was a number of great speakers and a lively Q&A. 

No comments: