IMPACT Community Capital’s Michael Lohmeier Outlines the “Acyclical” Attributes of Affordable Housing in P&I Column

Michael Lohmeier By Michael Lohmeier, CIO, IMPACT Community Capital

IMPACT’s CIO highlights how affordable housing debt can be an additive asset class for investors, whether looking through an investment or impact lens.

Within fixed income, many investors overlook the benefits of affordable housing debt as an uncorrelated credit exposure that can provide immediate current income and stable cash flows, with returns generally comparable to investment-grade bonds, albeit with historically less credit risk*.

In an op/ed published in Pensions & Investments, IMPACT Community Capital’s Chief Investment Officer, Michael Lohmeier, recently outlined how affordable housing debt can provide asset owners with an “acyclical” fixed income exposure. The article addressed the prevailing misconceptions around affordable housing. It also detailed both the market opportunity, characterized by a pronounced supply/demand imbalance, and the inefficiencies underpinning the investment opportunity, in which market expertise, networks, and deep experience create a distinct investment edge.

“Affordable housing debt provides low-volatility, low-correlation, long-duration exposure with predictable and consistent performance across economic environments,” Lohmeier wrote. “The payoff, beyond an investment thesis that helps address an insatiable demand for affordable housing, is an acyclical alternative within fixed income….”

* Past performance is not indicative of future results.

To read the complete article, please contact us.

IMPACT Community Capital was founded in 1998 by leading U.S. insurers for the sole purpose of providing institutional-quality, purpose-driven investments to institutional investors. IMPACT has originated $2 billion in impact investments since inception and continues to seek investment opportunities that provide stable income, competitive returns and positive impact to our communities.

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Disclaimer: This blog post is not an offering document for any securities. It is also not an offer of, or an agreement to provide, advisory services directly to any recipient. The information presented in this blog post is intended to describe certain views of the author and Impact Community Capital LLC. The information presented in this blog post may contain statements of opinion, forward-looking statements and relies on certain assumptions. Any such opinions, forward-looking statements and assumptions may be inaccurate, and there can be no assurances that the examples included herein will reflect actual investment outcomes. Neither the author nor Impact Community Capital LLC intends or assumes any obligation to update or revise these opinions, forward-looking statements and assumptions in light of developments which differ from those anticipated. Past performance may not be indicative of future results and there can be no guarantee as to the return or volatility of any particular impact investment or set of impact investments. All investments carry a risk of loss that investors should be willing and able to bear. Use of this document is subject to the terms and conditions set forth on Impact Community Capital LLC’s website and can be accessed at