Helping to solve the issue of social and community housing supply

18 April, 2024

3 min read

We want to be part of the solution for all Kiwi's to have a warm, dry place to call home.

Community Finance know that access to warm, safe and dry housing is a human right, and that this requires more social and community housing to be built quickly. However, getting funding for these projects remains a barrier to getting new homes constructed. That’s why this organisation exists – to bridge that gap.

Pathfinder has helped fund projects arranged by Community Finance (an unlisted private company) because it aligns with our community housing investment theme. We want to be part of the solution for ensuring all people in New Zealand, including our most vulnerable, have a warm, dry place to call home. We encouraged Community Finance to create a lending programme that looked like any conventional corporate bond or note.

“Community Finance is a fascinating example of innovation through finance to solve a significant social challenge,” says John Berry, Pathfinder CEO. “Before they had a settled product, their team had totally new ideas and insights to bring a solution to the market. Paul Brownsey (co-founder of Pathfinder and former CIO) and I spent quite a bit of time with them before launch, supporting their product development so that not only Pathfinder, but other fund managers could invest and support their work in social housing.”

We are now working on our fourth social housing project with Community Finance. In addition, Pathfinder’s parent company, Alvarium, has taken a 15% ownership stake in Positive Property (the parent company of Community Finance) to enable and support more projects. In 2023 the initiative delivered a three-storey walk up apartment complex in Auckland with shared communal spaces and a community garden, turning one vacant lot into a modern living space for the people who needed it most.

The difference the project is making on people's lives is evident in the Community Finance Impact Reports and the feedback from tenants.

Feedback from tennants

“I shifted in when it opened 3 years ago and have a new zest for life. I feel healthy and well, having space that I take pride in, is great. No smoking, drugs or other additive habits is awesome – well except for an addition to buying shoes! I recently brought a car, have casual work and love being appositive influence supporting others here in the housing community.” Hone, (name changed)

"I've been living here for about a year and a half, and a lot has happened in that time. I’ve got back into working and am now looking at starting my own business…Before I got involved with CORT, I had been living in another social housing development, in a tiny studio apartment. It was an unhealthy environment - there was violence, and I was surrounded by drug users and a negative energy. It wasn’t a safe place for me.” Maria (name changed)

The scale of the problem

As of 30 June 2023, there were 24,717 people on the emergency housing register. That, says John Berry, shows the scope and scale of the problem and why we need broad support from fund managers, KiwiSaver providers and others in financial services to help turn this around. “The problem is too big for any one charity, company or government to solve,” he says. “Solutions from investors, KiwiSaver and business are absolutely essential”.

So far Community Finance has provided social housing with income related rent subsidy for over 200 dwellings.

Find out more on our Impacts page.