SoLa Impact Receives $50M Commitment from CalSTRS
Its minority-led “Black Impact Fund” focuses on affordable and workforce housing in California.
SoLa Impact, a leading minority-led real estate fund focused on affordable and workforce housing in California’s Black and brown communities, announced that the California State Teachers’ Retirement System (CalSTRS) has anchored SoLa’s second close with a $50 million equity commitment into its “Black Impact Fund.”
CalSTRS’ investment combines commitments from the pension fund’s Real Estate and Sustainable Investment & Stewardship Strategies (SISS) units through its partnership with Belay Investment Group, CalSTRS’ emerging manager conduit.
“Our dedicated portfolio seeks to achieve superior financial returns while creating demonstrable social and environmental outcomes. The investment with SoLa Impact is our first real estate investment within SISS and aligns with our goals,” Kirsty Jenkinson, CalSTRS’ SISS investment director, said in prepared remarks.
To date, SoLa Impact has invested in the development of over 3,000 affordable and workforce housing units located primarily in Los Angeles. SoLa’s strategy includes the renovation of existing multifamily properties, as well as new ground-up construction projects in Black and brown communities.
SoLa takes a somewhat unique approach to investing in market rate workforce housing by embracing Section 8 vouchers and going beyond housing, using SoLa’s social programs offered through their affiliated non-profit, the SoLa I Can Foundation, that provide practical solutions for ending homelessness by equipping tenants with vocational training, financial counseling, scholarships, and pathways to self-sufficiency.
Minorities Struggle with Housing Affordability
Housing affordability has been a major issue for years, if not decades, for minorities. Black homeownership remains lower than a decade ago, the National Association of Realtors reported recently. Meanwhile, Hispanic American homeownership is at an all-time high and above 50% for the first time. However, the homeownership rate for Black Americans (43.4%) is lower than in 2010 (44.2%) and nearly 30 percentage points less than White Americans (72.1%).
With the investment, CalSTRS joins other institutional investors such as PayPal Holdings, Equitable Insurance, the Skoll Foundation, Ally Bank, Potenza Capital, Pacific Premier Bank and Adirondack Capital that have collectively invested over $250 million in SoLa’s Black Impact Fund.
The fund plans to formally close once it reaches its $300 million target.