Impact investor Community Capital buys innovative green asset-backed securities including PACE bonds

Written By: Stratton Report
November 3, 2016

On November 3, Community Capital Management, Inc., a fixed income impact investing manager, announced it had invested in what the firm termed innovative financing activities within the asset-backed security sector.

CCM added to its client portfolios of fixed income impact investments  several innovative ABS including Renovate America green bonds issued under the HERO PACE financing program and Toyota Motor Credit Corporation’s third ABS green bonds which will finance new retail finance contracts and lease contracts for Toyota and Lexus vehicles that meet criteria regarding powertrain, fuel efficiency, and emissions.

David Sand, chief investment strategist and impact officer at CCM remarked:

“ABS, while common on Wall Street, has been sparsely available to the market-rate impact investing community. Since we began managing impact investments in 1999 and up until a few years ago, I could only point to a handful of ABS deals with positive impact outcomes; however, over the past couple of years, we have seen a substantial increase in deal flow for ABS with a focus on sustainability and community development. We anticipate and look forward to even more activity in impact-oriented structured finance.”

Andy Kaufman, senior portfolio manager at CCM observed: “CCM is at the forefront of impact investing and we are continuously looking for alternative financing activities that fit our clients’ goals from a financial and impact perspective. Our traditional ABS exposure has been to Small Business Administration (SBA) loans providing access to capital, job creation and small business development. We are excited to add these offerings to our portfolio, especially given their strong social and environmental outcomes. We are equally enthusiastic to be a participant in helping shape the growth through our analysis and discussions with issuers and hope these offerings will spur future innovative ABS in the field of impact investing.”