Warehouse Founder Sir Stephen Tindall. Photo / File
Warehouse Founder Sir Stephen Tindall. Photo / File
The Warehouse founder Sir Stephen Tindall has joined with other high-profile backers to support an initiative aimed at financing to build affordable homes for families.
Community Finance, launched two weeks ago, is a social enterprise aimed at providing low-cost finance to organisations such as the Salvation Army, and Habitat ForHumanity to help address homelessness and the affordable housing crisis across the country.
The Tindall Foundation has joined the Lindsay Foundation, The Wilberforce Foundation, Christian Savings, and The Matua Charitable Trust in establishing Community Finance.
Chief executive James Palmer said the community housing sector was restricted by the high cost of borrowing from banks.
"The community housing sector needs advocates and impact investors like The Tindall Foundation to address the growing demand for affordable houses," he said in a statement.
"The private sector and the Government can't build these homes alone, and our aim is to work with them and community housing providers with a proven track record in helping tackle the housing crisis, to deliver more quality homes in vibrant and diverse communities for those who need them most."
Community Finance's first project is a Salvation Army Community Bond which requires investment of $40 million to fund 118 new homes in Royal Oak, Westgate and Flat Bush.
Sistema Plastics owner Brendan Lindsay. Photo / File
The largest investment in that bond comes from The Lindsay Foundation, founded by former Sistema Plastics owner Brendan Lindsay, with a commitment of $5 million towards this Community Bond.
Community Finance is currently in talks with a range of investors to fulfil the remaining $35m needed.
The Tindall Foundation has backed housing projects in the past, including NZ Housing Foundation developments in Auckland and Christchurch.
"We have been investing in community housing projects for the last 15 years and we understand the need to get behind initiatives like this to ensure every family in New Zealand has a safe and affordable place to live," he said.
The Tindall Foundation's backing would bring more capacity to the sector, he said.
Palmer says social and community housing makes up approximately three per cent of the overall New Zealand stock which is out of line with international rates of six per cent on average in developed countries.
Investors receive regular reports on the direct social impact of their investment as well as a financial return of between 2 and 2.5 per cent per annum. The bonds do not carry a credit rating.
