“Housing is the single most social determinant of health.”
We believe that if you want to change the world you need to start from the ground up; housing. Fondation Capital’s investment strategy is mission-driven geared toward positive social impact that specializes in servicing the housing needs of low and middle income families. We believe that housing is not only a human right, but that access to quality, stable, and affordable housing promotes more positive health outcomes for populations small and large. Everyone deserves a home where they can feel safe, happy, and healthy.
We are dedicated to reshaping affordable housing, while also promoting and enhancing social mobility. We proudly take on the role to do our part in helping communities that need private investment the most.
We believe that by aligning incentives through a place-based investment strategy we can not only achieve outsized returns for our investors, but also simultaneously improve the current affordable housing stock.
“Local, social impact is paramount within decisions made throughout our companies and investments.”
Parallel to the investments we make and manage, Fondation Capital also focuses our efforts to addressing the growing inefficiencies that current affordable housing initiatives fail to solve. We are dedicated to alleviating “barriers of entry” to housing by championing a “no broker fee” approach to rental housing, helping families with down payment assistance programs and educating the public on navigating the financial and real estate markets of our local and global economies.
Our Investors are…
- Income Driven: Our investment vehicles are structured to pay out a quarterly high-yield cash dividend.
- Tax Conscious: Our investment vehicles are designed to substantially limit the taxes paid on distributions received. The effective tax rate on the dividends paid will be substantially lower than income received from most other investment products.
- Seeking Diversification: Investors will be able to participate in a private equity investment that is unavailable on public markets. This is exposure to an asset class that has a high barrier to entry and is extremely intensive with capital, time, and management.
- Seeking Predictability: Our investments are profitable “as-is” when we acquire them. Our buildings are at or near full occupancy, with our intent to service all current tenant bases while working with local housing programs to alleviate the burden to our tenants. We believe we can lower expenses in a more environmentally and cost-effective way than previous owners, allowing us to pass on savings to investors.
Our business model is based around performance. We keep recurring fees as low as possible for our investors by being rewarded strictly by performance and achieving outsized returns across the board. By aligning incentives with our investors, we are able to create long-term value and share in every business’s success.
- Returns: Limited partners are paid preferred returns on a quarterly basis out of excess distributable cash flow generated from incoming-producing company assets. We offer multiple share classes in order to provide investors the ability to participate at the capital level and exposure they wish.
- Holding Period: Investment holding periods vary on a deal-by-deal basis but generally span between three and seven years. During this period, the asset will be repositioned in order to provide value for disposition. We provide multiple opportunities for our investors to continue their participation or pursue capital exit strategies that protect them the most.
Capital Return: Original capital contributions are returned to limited partner investors at the culmination of the investment holding period along with a pro-rata share of profits generated from the sale or refinance of company assets. It is always our intention to continue our investors success in projects by reinvesting capital gains in the most beneficial way.