Nuveen Real Estate
Update
09/19/23
Nuveen Secures Investment from TIAA for U.S. Impact Housing Fund Dedicated to Affordable Housing
Nuveen, the $1.1 trillion asset manager of TIAA and one of the world's largest real estate investment managers, today announced it has secured a $250 million commitment from the TIAA General Account to seed the Nuveen Real Estate U.S. Impact Housing Fund.
The core-plus, open-end fund is focused on generating strong risk adjusted returns and creating housing opportunities for low-income residents across the U.S., primarily by investing in a geographically diverse portfolio of properties, including housing with rent subsidies, rent restrictions, income restrictions and Naturally Occurring Affordable Housing (NOAH) assets. The fund also intends to invest in regenerative development and financing that supports minority and women developers of affordable housing.
Affordable housing is a compelling portfolio allocation, offering consistent income streams though different market cycles, strong demand and limited supply, due to guaranteed subsidized rent payments for a large portion of residents.
"As demand for affordable housing has intensified nationwide, more investors are seeking opportunities in this resilient housing sector that produces positive societal benefits and steady returns—both of which are also aligned to TIAA's objectives," said Pamela West, Portfolio Manager of Impact Investing at Nuveen Real Estate. "As a key component of healthy, sustainable communities, affordable housing also enhances economic activity and job creation."
Nuveen has extensive experience investing in U.S. affordable housing dating back to 1992. Nuveen also has unique capabilities as a vertically integrated affordable housing property manager, operator and developer. Through these capabilities, Nuveen has dedicated portfolio management support for its affordable housing assets and can work with local communities to preserve and develop more affordable housing.
"We are one of the few truly vertically integrated fund managers that can build, invest in and operate quality, safe affordable housing across the country," said Nadir Settles, Global Head of Impact Investing at Nuveen Real Estate. "By consistently reinvesting in our properties, we not only help our residents, but also build quality assets, which helps sustain investment value."
In alignment with Nuveen Real Estate's underlying mission, the fund will aim to address the preservation of housing for residents earning less than 80% of the Area Median Income (AMI), with a large concentration of households earning less than 60% AMI.
The U.S. Impact Housing Fund will also improve the quality of that housing through expenditures to help with environmental adaptability and enhance resident well-being through investment in resident services, like healthcare and education. All investments are expected to make a material step toward achieving important social and environmental outcomes in affordable housing in alignment with select UN Sustainable Development Goals.
