DALLAS–(BUSINESS WIRE)–CAF Funds, a subsidiary of CAF Companies dedicated to social impact, has acquired a portfolio of eight multifamily housing communities, growing its impact-driven portfolio to a total of 16 properties across Texas. The Obsidian portfolio was acquired by CAF in partnership with the Urban Investment Group within Goldman Sachs Asset Management.
With this acquisition, CAF and Goldman Sachs jointly own 3,800 units throughout metropolitan Texas, bringing CAF’s ‘Impact + Housing’ platform to upwards of 6,000 units. CAF Funds’ socially conscious investment platform layers nonprofit partners into the communities to provide resources and services that are purposefully aimed at resident wellbeing. Curated nonprofit programming includes after-school childcare, tutoring, summer camps, workforce development training, rental assistance, financial literacy, among others, and is provided to residents free of charge in a mission to enrich quality of life and foster a sense of community onsite. Additionally, CAF has partnered with Esusu across the portfolio to automate the reporting of monthly rent payments to credit bureaus as a tool to boost credit scores across the resident base.
CAF has recently been formally recognized by Freddie Mac with an Impact Sponsor designation and award for its endeavors in the social impact space and this acquisition aligns well within that vertical by providing self-imposed rental affordability restrictions – to preserve affordable housing within the DFW market. Freddie Mac, also CAF’s lender on this transaction, provided competitive financing in exchange for maintaining and enhancing affordability as well as providing supportive resident services during the duration of the loan period.
In addition to self-imposed rent restrictions and social programming, CAF and Goldman Sachs have planned to engage in expansive environmental sustainability audits to assist in evaluating and implementing capital improvements aimed at increasing energy efficiency across the portfolio such as LED lighting, more efficient water fixtures, updated HVAC units and smart landscaping.
“We are proud to continue our partnership with CAF to preserve access to affordable housing for families in the Dallas-Fort Worth region,” said Sherry Wang, co-head of the Urban Investment Group at Goldman Sachs. “With the potential to expand resident services through resources like after-school childcare, we have the opportunity to support the overall wellbeing of our tenants.” To date, the Urban Investment Group at Goldman Sachs has financed the creation and preservation of over 53,000 housing units – the majority of which are affordable to low- and moderate-income families.
As the nation’s housing crisis has only been exacerbated by COVID, CAF and Goldman Sachs have continued to seek opportunities to maintain and promote the existence of affordable housing – finding value in moderate rental growth complemented by increased retention and reduced operating expenses as resulting in emphasizing resident needs via onsite programming. “Our internal analysis and academic research led us to believe that we can align investor and resident interest and expect strong returns via this purpose-driven strategy,” said CAF Companies CEO Chris Faulkner. “These programs result in higher retention rates as residents find their lives enriched and spread the word about the programming.”
“We are working to bring social impact investing to arguably the most intimate venue of real estate: housing,” added Matt Falkin who has led this initiative by CAF.
Since its inception in 2010, CAF has acquired over 65 properties spanning nearly 25K units. In 2020, CAF, in partnership with Goldman Sachs, acquired The Residence at North Dallas, representing the first transaction within CAF’s impact platform. This acquisition saw the implementation of Kids-U, a prominent local nonprofit organization, onsite to provide daily no-cost after-school tutoring and childcare to residents in the community. Via Kids-U residents have benefited from private events with the Dallas Mavericks, swimming lessons, private tutoring, community mural painting, and more. This programming has been well received by the resident base and serves as a positive case study of social impact investing. CAF and Goldman Sachs expect to replicate a similar experience for residents across the Obsidian portfolio – again partnering with Kids-U, among a few other nonprofit partners, to bring a rather compelling appeal to living in these impact-driven communities.
CAF Companies manages over 70 multifamily properties across Texas, Arizona, and Oklahoma, with plans for further expansion across Texas and the Sunbelt Markets. CAF is headquartered in Frisco, TX and opened its Atlanta office earlier this year to target Southeast acquisitions. Founded in 2010 the CAF team has closed on and managed more than $4 billion in apartment properties.
About the Goldman Sachs Asset Management Urban Investment Group (UIG)
Bringing together traditional and alternative investments, Goldman Sachs Asset Management provides clients around the world with a dedicated partnership and focus on long-term performance. As the primary investing area within Goldman Sachs (NYSE: GS), we deliver investment and advisory services for the world’s leading institutions, financial advisors and individuals, drawing from our deeply connected global network and tailored expert insights, across every region and market—overseeing more than $2 trillion in assets under supervision worldwide as of September 30, 2022. Driven by a passion for our clients’ performance, we seek to build long-term relationships based on conviction, sustainable outcomes, and shared success over time. Goldman Sachs Asset Management invests in the full spectrum of alternatives, including private equity, growth equity, private credit, real estate and infrastructure. Established in 2001, the Urban Investment Group within Goldman Sachs Asset Management has committed over $14 billion through real estate projects, social enterprises and lending facilities for small businesses and students, creating economic value and opportunities for underserved communities and families. Follow us on LinkedIn.