NEW MARKET FUNDS TAKES 500+ UNITS FROM MARKET INTO NON-PROFIT OWNERSHIP

TORONTO, VANCOUVER, and MONTREAL, June 27, 2023 /CNW/ - New Market Funds, manager of one of the first funds in Canada to bring market-based investors to the table with non-profit partners to create new affordable housing, is pleased to announce its third investment in a new fund -- 363 apartments in Drummondville, Quebec, in partnership with Société locative d'investissement et de développement social ("SOLIDES"), the Lucie and André Chagnon Foundation and the Caisse d'économie solidaire Desjardins.

New Market Funds recently acquired an interest in more than 500 apartments in Quebec and Ontario, taking these from the market into non-profit ownership, permanently reconnecting rents to local incomes ? another first.  Currently, NMF Rental Housing Fund II ("RHF II") also has over 900 additional units under contract in pending acquisitions.

These "preservation" affordability investments build on the success of New Market Funds' first affordable housing fund, which is invested in 672 units of new non-profit and co-operative affordable rental housing in Victoria, Vancouver, Winnipeg, Toronto and Hamilton, and has further commitments outstanding on more than 500 new units currently in production. 

"The New Market Funds' acquisitions are a significant step in addressing rental affordability in the short and long term. The housing markets are failing low- and moderate-income renters and these investments by New Market Funds are critical in preserving the affordability of existing rental housing and demonstrating the impact of investment in this fund," John Phillips, Northpine Foundation.

In most communities, rents are taking an increasing percentage of incomes. According to CMHC's annual report, market rents for new tenants nationally increased 18% in 2022, and in Toronto and Vancouver are growing five times faster than median incomes over the past three decades, making them less and less affordable and putting increasing pressure on low- and moderate-income households.  This structural challenge is in the biggest cities, but also impacts smaller centres and towns, like Drummondville. 

"We were one of the first funds in Canada to bring market-based investors to the table with non-profit partners to create new affordable housing.  Now, we have created a fund to acquire rental units in the open markets for permanent conversion to non-profit ownership to protect affordability in perpetuity," said Garth Davis, Managing Partner, New Market Funds.

"Creating permanently affordable non-profit owned housing requires all the resources we can muster.  Philanthropic and government capital needs to be joined by private capital from investors looking for both market-rate, risk adjusted returns and communities where working Canadian's ? like teachers, nurses, firefighters, and EMTs ? can live as well as work," Andy Broderick, Managing Partner, New Market Funds.

New Market Funds' track record of delivering continuous distributions demonstrates the resiliency of non-profit owned multi-family assets.   In addition, New Market Funds is committed to long-term measurable community benefit, exemplified in its second fund by linking performance on affordability and GHG reductions to its compensation, a best-in-class standard among leading global fund managers.

"Our goal is to preserve more than 2,000 units of affordable housing in RHF II.  We are raising another $25 million this year to reach that goal," noted Garth Davis.  The capital raise is not a public offering and is only available to qualified investors in certain jurisdictions.

"Our objective at New Market Funds remains to deliver market-based returns for our investors while also creating significant social value. New Market Funds has proven its unique ability to work with different stakeholders and deliver replicable and scalable models for investors," said New Market Funds Board Chair, Erica Barbosa.

Funding for a critical component of the development work behind preservation strategy for RHF II was generously provided by the Community Housing Transformation Centre's  Sector Transformation Fund and the Trottier Family Foundation.  The Sector Transformation Fund also provided a grant to support diligence for the Drummondville acquisition. 

RHF II's investors to date include, but are not limited to:

ART Energy Services Inc.

Atkinson Foundation

Bealight Foundation

Congregation of the Sisters of St. Joseph in Canada

DerWing Capital Corp.

Fairmount Foundation

George Cedric Metcalf Charitable Foundation

Hamilton Community Foundation

J.W. McConnell Family Foundation

Lawson Foundation

Lynwood Family Foundation

Northpine Foundation

Paracas Investments Inc.

Real Estate Foundation of BC

Trottier Family Foundation

And clients of Genus Capital Management and Rally Assets

New Market Funds is a B Corp certified investment firm and Impact Assets 50 Fund Manager owned 51% by a registered Canadian Charity and 49% by its employees. As a specialized fund platform and manager, New Market Funds takes an integrated approach to delivering market competitive financial performance with lasting community benefit. New Market Funds currently manages over $85 million of capital through its own proprietary funds and as a third-party fund manager. New Market Funds has offices in Vancouver and Toronto.

Website: www.newmarketfunds.ca

SOURCE New Market Funds