NEW YORK, NY - TIAA-CREF and Jonathan Rose Companies announced the launch of the Rose Affordable Housing Preservation Fund LLC, a $51.6 million fund seeded by TIAA-CREF and Jonathan Rose Companies to acquire affordable and mixed-income multifamily housing in high demand markets across the US.
The Fund, which will be managed by Jonathan Rose Companies, is intended to improve and "green" the assets through high impact/low cost energy retrofits as well as hands-on asset management that will reduce/control expenses and enhance tenant quality of life. It will focus on the Washington, D.C. to Boston corridor, Chicago, Denver, Los Angeles, San Francisco, Portland and Seattle markets. The goal is to combine solid, risk-adjusted return potential with an integrated social and environmental mission.
The Rose Affordable Housing Preservation Fund leverages the expertise of Jonathan Rose Companies as a leading national developer, investor and fund manager with deep experience in green, urban affordable and mixed-income housing. TIAA-CREF's investment builds on a successful prior investment with Jonathan Rose Companies. Jonathan Rose Companies' relationships include other major financial institutions as well as leading foundations and family offices.
"TIAA-CREF's Social Impact Portfolio has a focus on affordable housing, and this investment with Jonathan Rose Companies furthers the portfolio's objective to preserve and recapitalize affordable properties while fostering vibrant, healthy and diverse communities," said Rekha Unnithan, Director within the TIAA's Responsible Investment- Impact Investing team.
TIAA-CREF's Social Impact Portfolio, which includes $700 million in commitments (as of 12/31/2013), reflects TIAA-CREF's commitment to directing capital towards high-quality investment opportunities that create measurable social outcomes. The goal of the program is to invest capital into areas facing "capital gaps" which have not yet been adopted by mainstream investors.
"We are gratified that TIAA has chosen to re-invest with us," said Jonathan F.P. Rose, founder of Jonathan Rose Companies. "In today's heated apartment rental market, preservation of well-located affordable housing that is at risk of becoming market rate is critical to the health of our communities. At the same time, these investments can provide a great opportunity to generate attractive, low-risk returns."
According to Nathan D. Taft, Director of Acquisitions for Jonathan Rose Companies, the Fund is pinpointing projects and portfolios from $25 to $50 million of total capitalization, with a special focus on mixed-income properties, Low Income Housing Tax Credit and Section 8 properties, and other properties with expiring affordability restrictions. Mr. Taft added, "We have a number of promising projects already in the pipeline, and we are actively seeking new opportunities."