In it for the long run

Good things come to those who wait. For a recent opportunity in HCF’s impact investment portfolio that wait will be 22 years, as it provides “patient capital” to help acquire two local residential properties and secure 31 units of permanent affordable housing.

Patient capital refers to investments in projects that take time to reach their potential. Although HCF won’t see the full return on investment until 2044, this project, at King Street East and Tisdale Avenue, fits into the Foundation’s strategy to rebuild a healthy affordable housing sector today. The $1 million investment with New Market Funds — a fund management firm focused on opportunities that benefit communities — will help to secure properties that might otherwise be acquired by the private sector. As New Market’s Derek Ballantyne told the CBC, “It helps low- income tenants have some predictability over what the rents will be like over the longer term and, obviously, some stability in their housing.”

Recent data underscores the importance of retaining Hamilton’s affordable housing stock. The Foundation’s latest Vital Signs report shows that Hamilton lost more than 15,000 affordable units in the private market (rent $750 per month or under) between 2011 and 2021. More than 9,000 units that rent between $750 and $1,000 per month were also lost.

Yulena Wan, HCF’s Vice-President of Finance & Operations, says that the ability to provide patient capital is one benefit of an endowment. “While no single offering can solve the problem, it is important that we act on what is possible,” says Yulena. “HCF’s endowment model makes us uniquely positioned to use more of our capital for good.”

From Fall 2023 Legacy Newsletter