Investing in Property for Social Impact
Sharon Smallworth, Communications Manager at Resonance, talks about why investment in property is delivering social impact and is good for investors.
Ever since Resonance started on its mission of getting investment into UK social enterprises over 16 years ago, property has been a big part of what we do. That’s because property is also often a big part of what they (the social enterprises) need, in order to help transform lives for the better.
And so it becomes clear that there isn’t one type of social impact property investment at all, but an array of opportunities, each attracting different types of investors, from institutions and local authorities investing hundreds of millions at one end of the scale, to the average person on the street who wants to invest just a few hundred pounds. At the heart of these investments is the social impact that is delivered, and that also comes in diverse forms.
So, for example, at the scale of institutional investment there is now The Real Lettings and National Homelessness property funds managed by Resonance in conjunction with homelessness charity St Mungo’s – a diversified residential property portfolio now over £150 million and offering commercial risk-adjusted returns to institutional investors, whilst also addressing a key issue in homelessness.
Interestingly, recent guidance from Government to UK pension funds has suggested that, as well as of course delivering the pensions we all need, they should also take into account the social and environmental impacts of their investments and the views of the Fund’s beneficiaries on these issues. So we as individuals can begin to influence the way the big financial institutions steward our money for greater social and environmental impact.
But there are also other types of social impact property investment that are available to a wider range of investors. Some of these arise from the Community Land Trust (CLT) movement – local organizations addressing the very real need for homes that are affordable now and affordable in perpetuity in communities across the nation. CLTs have proved to be an effective mechanism for delivering affordable homes to meet local demand.
This is also an area where “Community Shares” have become an increasingly popular way for individuals to invest into this kind of community-led social enterprise – with community groups working towards a shared goal, whether to build an affordable housing scheme or to secure other local assets which may be precious to a local community, such as a shop or a local pub.
Or, as with our recently launched community share for Mustard Seed Property on Ethex, to provide some “forever homes” for vulnerable adults living in Cornwall. This Community Share offer has already attracted local residents, second home owners, MPs, businesses and even large Foundations – in fact anyone who is engaged with addressing this impact need and feels a connection to the county. With investment starting from as little as £250 – it really is an opportunity for all.