Developer issues $100M in Series 2022 Social Bonds
NEW YORK: A developer is using social bonds to underpin the construction of multigenerational affordable housing.
National Community Renaissance of California (National CORE), one of the leading developers and providers of affordable housing in the country, closed yesterday on its issuance of $100 million in Taxable Bonds, Series 2022 (Social Bonds). The closing marks only the second time bonds have been made available by a nonprofit affordable housing developer in the United States.
National CORE will use the proceeds of the bonds to finance the acquisition, development, and preservation of high-quality affordable multifamily housing, in alignment with National CORE’s mission of breaking the cycle of poverty by providing affordable housing options and industry-leading social services to the underserved communities that need them most.
In 2021, National CORE became the only affordable housing developer in Southern California and only the second in the nation to receive an A+ rating from Standard & Poor’s (S&P) Global Ratings, one of the foremost U.S. providers of credit ratings. That achievement provided National CORE with access to new, non-traditional financial resources, reinforcing and accelerating the non-profit’s effort to address the chronic housing affordability crisis facing cities across the country.
“This is a game-changer for the affordable housing industry and, more importantly, those who struggle with housing instability. By accessing capital markets, we can dramatically accelerate the development and preservation of critically-needed affordable housing across the country,” said National CORE CEO/President Steve PonTell. “Stable housing strengthens community health, educational attainment, economic mobility, and quality of life. Our hope is that other affordable housing developers will follow National CORE’s lead by embracing this ground-breaking financing model.”
National CORE’s goals mirror the Social Bond Principles as promulgated by the International Capital Market Association of supporting affordable housing, socioeconomic advancement and empowerment, and access to essential services as a means of ending poverty, reducing inequalities and promoting sustainable cities and communities.
The U.S. continues to struggle with an affordable housing shortage, lacking 6.8 million rental homes for households with incomes at or below the poverty guideline (0-30% of area median income), according to a 2021 report by the National Low Income Housing Coalition. That shortage has nearly doubled from a 3.6-million-unit shortfall in 2019.