SAN FRANCISCO–(BUSINESS WIRE)–The Low Income Investment Fund (LIIF) just completed its inaugural public debt offering with a $100 million Sustainability Bond issuance, drawing significant interest from leading institutional investors. The offering was ten times oversubscribed, allowing LIIF to obtain attractive pricing, demonstrating the growing demand for quality investments that support social and environmental impact. LIIF’s issuance, which received an A- positive outlook rating from S&P and was led by Morgan Stanley as senior manager with JP Morgan Securities as co-manager, attracted significant interest from global investors such as Nuveen, Neuberger Berman and PIMCO.
The successful issuance signals confidence in the financial strength and high impact of LIIF, one of the nation’s leading nonprofit community development financial institutions (CDFIs). The offering included 7-year and 10-year bonds, which will be used to finance vital community development projects across the country.
LIIF’s issuance is the first CDFI bond issue to receive a second party opinion from Sustainalytics to further validate LIIF’s Sustainability Bond Framework. This is also the first CDFI bond to align directly with the United Nations’ Sustainable Development Goals. The Sustainability Bond Framework that LIIF developed to issue its bond supports investments in projects that link environmental sustainability and social impact.
“For 35 years, LIIF’s investments have been creating better places for families to live, work and thrive. We’ve invested more than $2.5 billion and leveraged over $12 billion of private capital to serve more than 2 million people in 31 states,” said LIIF CEO Daniel A. Nissenbaum. “This issuance represents a significant milestone for LIIF in accessing the capital markets. It broadens our investor base, helps manage interest rate risk and will enable LIIF to finance more critical community serving projects. It is also a powerful signal that the market understands the social and financial returns that CDFIs, like LIIF, provide to our investors and the communities we serve.”
This issuance with Morgan Stanley and JP Morgan Securities is a continuation of LIIF’s relationship with both organizations, which have been long-time supporters of LIIF’s mission.
“Morgan Stanley is honored to have led LIIF’s inaugural $100 million public debt issuance, a transaction with over $1 billion in investor orders, including more than $345 million from sustainability-focused funds. This signals a new phase of public capital market acceptance and demand for CDFI bonds,” said Audrey Choi, CEO of the Morgan Stanley Institute for Sustainable Investing. “It marks the continuation of our long-standing partnership with the Low Income Investment Fund, and our firm-wide dedication to the CDFI sector at large.”
“As a leader in responsible investing, we are committed to seeking out opportunities that affect social change and amplify impact,” said Stephen M. Liberatore, CFA, managing director at Nuveen overseeing $10 billion in responsible investing fixed income strategies, including the TIAA-CREF Social Choice Bond Fund. “The Low Income Investment Fund bonds offer the opportunity to invest in a diverse portfolio that in turn helps us achieve both competitive returns and a direct and measurable impact, such as access to affordable housing, educational opportunities, health clinics and healthy food for struggling communities, on behalf of our clients.”
LIIF’s success in offering bonds with longer durations and highly competitive pricing points to the organization’s strong track record and high-quality team. This bond issuance builds on the achievement of previous CDFI issuances and demonstrates increased investor education and confidence in the sector.
LIIF’s capital is critical to its borrowers, who are mission-driven developers and nonprofits. The bond issuance enables LIIF to provide these organizations with more stable, lower cost and longer term capital, which supports their long-term sustainability and enables them to provide much needed services in their communities.
“LIIF is a premier CDFI partner because of their creativity, leadership, and financial execution. Our organization works across 30 metro areas and 14 states on transformative development ventures. LIIF’s financial expertise and innovative, flexible capital is critical to supporting The Community Builders’ mission of building and sustaining communities where all families can thrive,” said Bart Mitchell, CEO of The Community Builders Inc., one of the country’s largest housing & community development nonprofits.
With this bond offering, LIIF will be able to support more projects like:
- Several projects in Washington, D.C. that create and preserve affordable housing for low income District residents in neighborhoods at risk of rapid gentrification
- Affordable housing, early childhood education and nonprofit arts space in San Francisco’s Mission District, which is at the forefront of the city’s displacement crisis.
- A Federally Qualified Health Center in New Orleans that will bring needed health services and community programing to the city.
- A mixed-use development that provides residents of the South Bronx with much-needed access to a full-service grocery store, health center, and retail in a neighborhood that had lacked accessible shopping and health care.
In addition to its S&P rating, LIIF consistently receives the highest possible rating for impact and financial strength from Aeris™, a third-party rating organization for CDFIs. For three years in a row, LIIF has been selected for the ImpactAssets 50, a list of 50 top-tier impact funds.
About the Low Income Investment Fund
The Low Income Investment Fund invests capital to support healthy families and communities. Since 1984, LIIF has served more than two million people by providing $2.5 billion in financing and technical assistance. Over its history, LIIF has supported efforts in 31 states to create and preserve 78,000 units of affordable housing; 271,000 child care spaces; 98,000 spaces in schools; and 36 million square feet of community facilities and commercial space. LIIF’s work has generated $65.1 billion in family income and societal benefits. LIIF has offices in San Francisco, Los Angeles, New York City, Washington, D.C. and Atlanta. For more information, visit www.liifund.org.
Clair McDevitt, Communications Manager
Low Income Investment Fund