MESSAGE FROM LEADERSHIP

Over this past year, we committed more than $350 million across our impact funds into real estate and small business investments in and with underinvested populations across the country. This incredible achievement is the realization of a dream that we have been working towards since the start of the LISC Strategic Investments group in early 2020, and it is only the beginning of our journey. In this report, you will see both the impact metric achievements that resulted from those investments, but also a glimpse into the stories that highlight the people and places that make this work worthwhile. Along the way, there have been challenges, successes, and failures but we have endured, building this team, raising innovative funds, and now moving into making intentionally impactful investments.

Our team is mostly comprised of professionals who left behind impressive careers in the private sector, sacrificing lofty salaries and big bonuses to do the work necessary to repair the gaps and inequities in this country. These men and women are some of the strongest patriots with whom I have had the pleasure of working. Each is driven, like myself, by the belief that anyone presented with the opportunity to succeed and the resources to do so, will flourish. And, more specifically, that by fixing the unequal distribution of capital, we can start to seed those opportunities and make for better outcomes for underserved communities and the country as a whole.

We expect that our actions will change the direction of this country, shrinking inequities in health, wealth and opportunity gaps, which are currently growing worse year over year. We do not expect to do this alone, but that we will innovate and prove out investment theories that will attract more traditional investors to bring enough scale to solve these issues. As such we are missioned with discovering new investments and investees and proving out the notion that talent can be found everywhere with deserving investees in all parts of the country. We expect to be a tipping point for a movement into investing in these communities and to lead by example bringing more traditional investors along for the ride.

We want to thank our investment partners, our investees, our community and public sector partners, and most of all our local offices. The local office network of LISC makes all the difference in our ability to bring the right capital solutions to each geography with the appropriate geographical context. We are excited to continue to grow our impact in 2022 and with your help, scaling proven models and exploring new and innovative methods of providing opportunity through capital investment.

Sincerely,

George Ashton Managing Director, LISC Strategic Investments

WHO WE ARE

Our team

LISC Strategic Investments (SI) is LISC’s national team of experts charged with designing, launching, and managing successful place-based impact funds and innovative capital vehicles across the country. We combine the power of local expertise with the sophistication of national resources to effect significant impact while securing stable returns.
Our diverse leadership team is driven by the confidence that capital can be used to make a difference for people across the US. We put our 120+ years of combined experience to work determinedly to ensure our investments make sustained impact.
Learn more about the LISC SI team [+]

Contact Information:

How we drive change

We are a mission driven organization with passionate people from the private and public sector. Our investment experts create and deploy innovative products that maximize impact outcomes, minimize risk, and optimize double bottom line returns.

  1. Fund Management [+]
  2. Capital Innovation Lab [+]
  3. Venture Investments [+]

We invest in both real estate and businesses by utilizing unique and innovative combinations of public, private, and philanthropic investments, bringing all partners to the table.

Our community centric impact framework drives our mission-centered investment strategies. We work alongside our partners to align impact strategies and desired impact outcomes.

Over the years, we have work on major impact themes that drive our daily efforts:

  • Affordable Housing
  • Racial Equity
  • Inclusive Economic Development
  • Transit Oriented Development
  • COVID Recovery Support

The private investment pools sponsored by LISC are available only to eligible investors, are offered only pursuant to their official offering documents, and are managed by LISC Fund Management, which is a wholly-owned subsidiary of LISC. LISC Fund Management* is an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”). Registration of an investment adviser with the SEC does not imply any level of skill or training. Please visit the SEC’s website at www.adviserinfo.sec.gov to see LISC Fund Management’s Form ADV, which contains important disclosures, including further disclosures about material conflicts of interest, risks, and limitations associated with LISC Fund Management.

BY THE NUMBERS

LISC Strategic Investments

The investment strategies we manage are designed intentionally to deploy capital on behalf of our investor and funders into impactful projects and organizations that are building stronger communities across the US. Within the first three years of the launch of the first LISC-managed private investment fund, we are proud to have grown a portfolio of this magnitude, both in terms of financial and impact numbers:

*All numbers are as of 12/31/2021

$748.8 million

total assets under management

75+

investors and funders

housing units created or preserved

$350+ million

dollars committed

7

active funds

jobs created or retained

LISC

Our parent company, the Local Initiatives Support Corporation (LISC) is one of the US’s largest Community Development Finance Institutions (CDFI) with 38 local offices, a rural program reaching 2,200+ counties in 45 states, and LISC-founded affiliate and entities. Since 1979, LISC has been supporting projects and programs to revitalize communities and bring greater economic opportunity to residents.

*All numbers are for the year 2021.

$2.7 billion

invested

$6 billion

leveraged

affordable homes and apartments

4 million

square feet of commercial space

ACTIVE FUNDS

*All numbers listed below are inception to 12/31/2021.

Black Economic Development Fund

The Black Economic Development Fund (BEDF) is an impact investment fund built specifically to address economic challenges in the Black community and to help close the racial wealth gap. The fund targets Black-led financial institutions, Black-led businesses, and Black-led anchor institutions with the goal of growing these organizations and strengthening their contributions to the Black community. The funds deployment strategy is industry agnostic and will deploy capital across a diverse set of borrowers and geographies in the US.

$250 million

capital closed

$86.6 million

dollars committed

15

deals closed including 3 bank deposits

621

housing units financed

$12 million

in deposits at Black banks

Commercial Real Estate, Housing, Financial Institutions

Charlotte Housing Opportunity Investment Fund The Charlotte Opportunity Investment Fund is a mission-driven real estate fund focused on improving the economic mobility of Charlotte residents through increasing the availability of and access to quality affordable housing in areas of opportunity. The CHOIF aims to help households making at or below 30-120% area median income (AMI). The CHOIF works in partnership with the City’s Housing Trust Fund and in tandem with other project based vouchers, low-cost debt and land donations that have been contributed for affordable housing.

Fully committed, less than 2 years

$43 million

capital closed

$26 million

dollars committed

1,047

affordable housing units financed

Fully allocated

within 3 years

50%/50%

preservation/new construction

25%

of units at or below 30% AMI

Detroit Housing for the Future Fund (DHFF) The Detroit Housing for the Future Fund (DHFF) aims to provide affordable housing developers and owners with streamlined access to financial tools designed to increase availability of affordable housing in Detroit neighborhoods. The DHFF is part of a larger affordable housing initiative led by the City of Detroit Housing & Revitalization Department (HRD), LISC, and the Michigan State Housing Development Authority (MSHDA).

$58 million

capital closed

$12.5 million

dollars committed

6

deals closed

239

housing units financed

38%

developers of color

$231,389

developer or color grants

New York Forward Loan Fund (NYFLF) The New York Forward Loan Fund Trust (NYFLF) is conduit loan fund providing flexible, low-interest capital to small businesses, nonprofits, and small landlords in New York State reeling from the economic impact of COVID-19. The NYFLF enables partner CDFIs to increase loan servicing and technical assistance to small and local businesses and nonprofits, providing organizations with the support they need to reopen and navigate a new economic reality. LFM manages the NYFLF capital, which will be distributed via five CDFIs.

$91.5 million

dollars committed

1,716

loans purchased

$56,119

average loan size

41%

women-owned businesses

46%

minority-owned businesses

6,410

jobs created or preserved

Partnership for the Bay’s Future: Family of Funds The Partnership for the Bay’s Futures family of loan funds supports the production and preservation of affordable homes for residents of the bay area. Managed by LFM and originated through LISC, the Corporation for Supportive Housing (CSH), and Capital Impact Partners (Capital Impact), the funds are designed to bridge funding gaps throughout the region's rental housing market.

$518 million

capital closed

$260 million

dollars committed

31

deals closed

3,310

housing units financed

91%

units at or below 80% AMI

25%

units at or below 30% AMI

Southern Opportunity and Resilience Fund (SOAR) The Southern Opportunity and Resilience (SOAR) is a mission driven private conduit loan that provides flexible, affordable capital and free business support services to small businesses and nonprofits across the south and southeast to help them navigate and rebuild from the Covid-19 economic crisis. SOAR is managed by LFM as a part of a collaborative partnership of local and national community finance organizations.

305

loans purchased

$13.9 million

dollars committed

$47,833

average loan size

71%

minority-owned businesses

1,318

jobs preserved or retained

92%

of businesses had less than $1M in annual revenue

Rockefeller Opportunity Zone Initiative The Rockefeller Foundation partnered with LISC Strategic Investments to manage $2.4 million Opportunity Zone Pipeline Seed Grants to build capacity and pipeline of equitable investment projects in six cities across the United States. Although the programs ended early, the program made recoverable grant investments across three cities.

$679,000

recoverable grants given

6

projects

6

cities

BORROWER STORIES

We are so excited to highlight the stories of some amazing people that we've had a chance to work with. These diverse individuals impressed us daily by their drive, entrepreneurship, and talent.

BLACK ECONOMIC DEVELOPMENT FUND (BEDF)

Hannibal Square

Founded in 2004 in response to concerns regarding gentrification, Hannibal Square Community Land Trust (HSCLT) is an established non-profit community-based corporation led by developer Camille Reynolds Lewis focused on increasing homeownership. The Black Economic Development Fund (BEDF) provided a $5.75 million construction loan that will provide construction financing for a new 30-unit for-sale townhome development in the West Lakes community of Orlando Florida, a historically Black neighborhood. Homeowners will be members of a community land trust, lowering financial barriers to homeownership for households. The project will support efforts to close the racial homeownership gap. Both HSCLT and the intended general contractor selected for the project, CTG, are majority Black-owned.

BLACK ECONOMIC DEVELOPMENT FUND (BEDF)

Bridging the Gap

Bridging the Gap Development, LLC (“BTG”), founded in 2006, is a diversified real estate development firm based in Pittsburgh, PA. Mr. Derrick L. Tillman, Founder and President of BTG, leads the company’s mission to rebuild healthy, sustainable communities through residential & commercial development. The BEDF structured a $1.5 million predevelopment loan for the preconstruction costs related to BTG’s new affordable housing development venture. This loan filled the missing piece of the capital stack to develop the “Fifth & Dinwiddie” project, a sustainable development of 171 units of mixed-income housing and 12,000 square feet of retail space. BTG has also committed to using at least 40 percent minority women business enterprise sub-contractors for the west side development.

“My experience with the Black Economic Development Fund and LISC was a breath of fresh air. The team worked with us expeditiously to get the deal done and they were willing to think outside the box. This fund is truly an answer to my prayers” - Derrick Tillman, President & CEO, Bridging the Gap, LLC

DETROIT HOUSING FOR THE FUTURE FUND (DHFF)

The Charlotte

The Charlotte is a $3.19 million redevelopment that includes 12 one-bedroom units, 13 two-bedroom units with three studio apartments. Thirty-two percent of the building is restricted to households at or below 60 percent area median income (AMI). The remaining units will remain affordable and will not exceed 80% AMI. The developers, Tom Anderton and Adam Noel of Charlotte Detroit LLC, have invested in the neighborhood north of Boston-Edison and this Charlotte will be the fifth building in their portfolio, bringing 100 units of affordable housing to Detroit. The Detroit Housing for the Future Fund (DHFF) provided a $2.55 million loan that will help turn the abandoned 1923-built, three-story apartment building into 28 units of quality affordable housing.

SOUTHERN OPPORTUNITY AND RESILIENCE FUND (SOAR)

Overhead Station

Founded in 1977, Overhead Station boutique shop located in Rock Hill, SC selling unique gifts sourced from regional and local craftspeople. Overhead Station used the SOAR loan to freshen up the storefront, purchase new merchandise, and buy additional display fixtures to drive customer business. The loan was sourced through Neighborhood Development Center (NDC). “The reason I liked this loan is because of the interest-only payments for a year. I worked with NCD to design a loan I could afford to pay back,” said Tami Windell, co-owner of Overhead Station.

Here is a video about the history & original owner who passed along the shop in 2018 to the individuals trying to keep this long-standing business alive through the pandemic.

New York Forward Loan Fund (NYFLF)

Shining Studios Theater

Kyle Savage, Executive Director and Founder of Shining Studios Theater in Port, Washington NY, received a NYFLF loan through the national CDFI, National Development Council (NDC). This loan allowed Savage to take their afterschool theatre program outdoors throughout the summer and fall, putting on several full-scale productions, and convert to online presentations over the winter. Kyle was also able to pay the teaching staff and purchase necessary materials using the loan.

Charlotte Housing Opportunity Investment Fund (CHOIF)

Pines on Wendover

The Pines on Wendover is a 44 unit three-building, garden-style property originally constructed from 1985-1987. The property offers amenities including a picnic/grilling area, a dog park, leasing office, and on-site supportive services through a Community Health Worker.100%of the units are affordable with 14 at or below 30% AMI and 30 at or below 80% AMI. The property is located in the Wendover-Sedgewood neighborhood of Charlotte, NC.

The developer, Ascent, began renovations shortly after acquiring the property and achieved 100% minority women-owned small business enterprise participation through the general contractor, Harmon Construction Services. Improvement plans to benefit residents include completion of deferred maintenance of the roof, landscaping/drainage, parking lot, building exterior, and upgrades to unit interiors (upon turnover).

Partnership for the Bay's Future - Bay's Future Fund

Friendship Senior Housing Project

Set to break ground in Summer 2022, the 49-unit senior apartment building will sit on land owned by Gerald Agee Ministries in the Ralph Bunche neighborhood of West Oakland. Affordable housing is critically needed in this neighborhood where 27% of the population lives below the poverty line and the median family income is 36% of Area Median Income (AMI). The Partnership for the Bay’s Future – Bay’s Future Fund provided a $327,000 predevelopment loan for this project to finance the construction. The sponsor is the Community Housing Development Corporation (CHDC), in partnership with the Friendship Community Development Corporation (FCDC). FCDC is the non-profit community development affiliate of the Gerald Agee Ministries (DBA Friendship Christian Church).

2021 HIGHLIGHTS

We're proud of the work we've done and recognize that it is a rare occasion to take a minute for self-reflection. From starting up new initiatives which helped shape who we are today as an organization, or celebrating the successes of our borrowers - it is incredible seeing highlights of these activities come together in one place.

02.25.21 | VIDEO IMPACT

Develop Detroit taps Detroit Housing for the Future Fund to preserve affordable housing.

03.16.21 | IN THE NEWS

LISC Recognized as an ImpactAssets 50 Emeritus Impact Manager

LISC has been named Emertius Impact Manager for the ImpactAssets 50 (IA 50), a who’s-who of fund managers dedicated to creating positive social and environmental impact.

More [+]

05.26.21 | VIDEO IMPACT

BEDF Closed at $250 Million, Makes First Investments - BEDF + Dantes Partners

06.23.21 | IN THE NEWS

LISC, Stepping up the Intensity

How LISC, Enterprise Hope to Bring More Capital to Developers of Color

More [+]

10.18.21 | IN THE NEWS

$10 Million LISC's BEDF Investment Agreement To Expand MWBE Opportunities

LISC’s Black Economic Development Fund Commitment Offers MWBEs and SDVOBs Access to Capital. Bonding Needed to Compete for Opportunities as Prime Contractors Program to Create Jobs and Opportunities for Smaller MWBE/SDVOB Firms Statewide.

More [+]

12.01.21 | VIDEO IMPACT

#PowerofCapital Video Series Launch – Carver Federal Savings Bank – Investing in Black Women-led Business

03.03.21 | BIG LAUNCH

SOAR - Multi-Million Dollar Fund Launches to Invest in Businesses Across the South

The SOAR fund aims to support the recovery of small businesses and nonprofits with access to flexible, affordable capital and free business support services across 15 southern states

More [+]

04.19.21 | VIDEO IMPACT

Re-Introducing the Partnership for the Bay’s Future

06.10.21 | BIG LAUNCH

Entrepreneurs or Color Loan Fund Kicks Off

Block (Formerly Square, Inc.) Allocates $25M for Minority and Underserved Communities, Including $10M to Entrepreneur

More [+]

06.23.21 | VIDEO IMPACT

CHOIF 2 Year Anniversary

10.27.21 | IN THE NEWS

LISC Featured in Impact Alpha

Patient capital for established BIPOC businesses to close racial wealth gaps

More [+]

12.08.21 | BIG LAUNCH

Dallas Housing Opportunity Fund launches to fuel diverse housing development, drive economic growth

The fund is a targeted response to Dallas’ urgent need for additional affordable housing units. This effort is meant to promote fair housing by fostering investments that dismantle long-standing patterns of segregated housing.

More [+]

02.25.21 | VIDEO IMPACT

Develop Detroit taps Detroit Housing for the Future Fund to preserve affordable housing.

03.03.21 | BIG LAUNCH

SOAR - Multi-Million Dollar Fund Launches to Invest in Businesses Across the South

The SOAR fund aims to support the recovery of small businesses and nonprofits with access to flexible, affordable capital and free business support services across 15 southern states

More [+]

03.16.21 | IN THE NEWS

LISC Recognized as an ImpactAssets 50 Emeritus Impact Manager

LISC has been named Emertius Impact Manager for the ImpactAssets 50 (IA 50), a who’s-who of fund managers dedicated to creating positive social and environmental impact.

More [+]

04.19.21 | VIDEO IMPACT

Re-Introducing the Partnership for the Bay’s Future

05.26.21 | VIDEO IMPACT

BEDF Closed at $250 Million, Makes First Investments - BEDF + Dantes Partners

06.10.21 | BIG LAUNCH

Entrepreneurs or Color Loan Fund Kicks Off

Block (Formerly Square, Inc.) Allocates $25M for Minority and Underserved Communities, Including $10M to Entrepreneur

More [+]

06.23.21 | VIDEO IMPACT

CHOIF 2 Year Anniversary

06.23.21 | IN THE NEWS

LISC, Stepping up the Intensity

How LISC, Enterprise Hope to Bring More Capital to Developers of Color

More [+]

10.18.21 | IN THE NEWS

$10 Million LISC's BEDF Investment Agreement To Expand MWBE Opportunities

LISC’s Black Economic Development Fund Commitment Offers MWBEs and SDVOBs Access to Capital. Bonding Needed to Compete for Opportunities as Prime Contractors Program to Create Jobs and Opportunities for Smaller MWBE/SDVOB Firms Statewide.

More [+]

10.27.21 | IN THE NEWS

LISC Featured in Impact Alpha

Patient capital for established BIPOC businesses to close racial wealth gaps

More [+]

12.01.21 | VIDEO IMPACT

#PowerofCapital Video Series Launch – Carver Federal Savings Bank – Investing in Black Women-led Business

12.08.21 | BIG LAUNCH

Dallas Housing Opportunity Fund launches to fuel diverse housing development, drive economic growth

The fund is a targeted response to Dallas’ urgent need for additional affordable housing units. This effort is meant to promote fair housing by fostering investments that dismantle long-standing patterns of segregated housing.

More [+]

OUR INVESTORS

LISC Strategic Investments is thankful to have an investor base that supports our mission-focused work. Our investors and funds in the funds and programs we manage range from public corporations to private foundations, from national banks to local funders, all with aligned goals and beliefs of what their capital can do for a greater good. We are grateful for all of the support as we work together to build more inclusive communities across the country in which we hope everyone can thrive. Below are some of our highlighted investors:

AFLAC, Inc.

Ally Bank

Apple Bank

Bank of America

Barings

Block (formerly Square, Inc.)

Blue Cross/Blue Shield of Michigan

BNB Bank

Capital Impact Partners

Capital One

Chan Zuckerberg Initiative

CIBC Bank

Citi Foundation

Citizens Bank

Corporation for Supportive Housing

Costco Wholesale

Destination Home

Deutsche Bank

DICK'S Sporting Goods, Inc.

Duke Energy Foundation

DuPont

Evans Bank

Fifth Third Bank

First Independence Bank

First Republic Bank

Flagstar Foundation

Ford Foundation

The Ford Motor Company

Foundation for the Carolinas

Genentech

The Grove Foundation

Heifer International Foundation

HSBC Bank USA, N.A.

Hubspot

The Huntington Foundation

Jewish Community Federation of San Francisco, the Peninsula, Marin and Sonoma Counties

JPMorgan Chase

W.K. Kellogg Foundation

KeyBank

The Howard R. Levine Foundation

M&T Bank

McKinsey & Company, Inc.

Mercy Investment Services

Meta Platforms, Inc. (formerly Facebook)

MetLife

Microsoft Corporation

Mizuho Bank, Ltd.

Morgan Stanley

Ms. Foundation for Women

Netflix

Novant Health

The David and Lucile Packard Foundation

PayPal

Penske Corporation

Phillips Foundation

PNC

The San Francisco Foundation

Silicon Valley Community Foundation

TCF Bank

Thermo Fisher Scientific

Truist Financial Corp.

Visa Foundation

Wayfair LLC

Wells Fargo

The Ralph C. Wilson, Jr. Foundation

Winrock International Foundation

Never doubt that a small group of thoughtful committed citizens can change the world: indeed it's the only thing that ever has.”
Margaret Mead

Disclaimer

This report is not, and nothing in it should be construed as, an offer, invitation or recommendation in respect of the Company’s credit facilities or any of the Company’s securities, or an offer, invitation or recommendation to sell, or a solicitation of an offer to buy, the facilities or any of the Company’s offerings in any jurisdiction. Neither this report nor anything in it shall form the basis of any contract or commitment. This report is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate.

The Company has prepared this report based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the information, opinions or conclusions expressed herein. Any projections should not be considered a comprehensive representation of the Company’s cash generation performance. The financial information included in this presentation is preliminary, unaudited and subject to revision upon completion of the Company's closing and audit processes. This financial information has not been adjusted to reflect the outcome of any reorganization of the company’s capital structure, the resolution or impairment of any pre‐petition obligations, and does not reflect fresh start accounting which the company may be required to adopt.

All forward–looking statements attributable to the Company or persons acting on its behalf apply only as of the date of this document, and are expressly qualified in their entirety by the cautionary statements included elsewhere in this document. Any financial projections are preliminary and subject to change; the Company undertakes no obligation to update or revise these forward–looking statements to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Inevitably, some assumptions will not materialize, and unanticipated events and circumstances may affect the ultimate financial results. Projections are inherently subject to substantial and numerous uncertainties and to a wide variety of significant business, economic and competitive risks, and the assumptions underlying the projections may be inaccurate in any material respect. Therefore, the actual results achieved may vary significantly from the forecasts, and the variations may be material.

There is no assurance that the investment objective of a fund managed by the Company will be achieved or that investors will receive a return on their capital. Investors must read and understand all the risks described in a fund’s final confidential private placement memorandum and/or the related subscription documents before making a commitment. Investors also must consult their own legal, accounting and tax advisors as to the legal, business, tax and related matters concerning the information contained in this document to make an independent determination and consequences of a potential investment in a fund, including US federal, state, local and non-US tax consequences.

Past performance is not indicative of future results or a guarantee of future returns. The performance of any portfolio investments discussed in this document is not necessarily indicative of the performance of any other of the Company’s portfolio investments or any future performance, and investors should not assume that investments in the future will be profitable or will equal the performance of past portfolio investments. Investors should consider the content of this document in conjunction with investment fund quarterly reports, financial statements and other disclosures regarding the valuations and performance of the specific investments discussed herein.

The Company may not be able to achieve its investment objectives (including target returns) for various reasons, as set out in more detail elsewhere in this document and in the offering documents. Among other things, the novel coronavirus (COVID-19) outbreak throughout the world and related responses (e.g., closing of various market segments and businesses) has raised uncertainty in valuing (and making related estimates for) certain assets, including assets that the Company holds or will seek to invest in. This uncertainty could remain for a significant period of time.

*The private investment pools sponsored by LISC are available only to eligible investors, are offered only pursuant to their official offering documents, and are managed by LISC Fund Management, LLC (LFM), a wholly-owned subsidiary of LISC. LFM is an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”). Registration of an investment adviser with the SEC does not imply any level of skill or training. Please visit the SEC’s website at www.adviserinfo.sec.gov to see LISC Fund Management’s Form ADV, which contains important disclosures, including further disclosures about material conflicts of interest, risks, and limitations associated with LFM.