The Multifamily Impact Council (MIC), a non-profit membership organization dedicated to establishing a framework of impact principles and reporting guidelines for the rental apartment industry in the United States, and New York University Stern School of Business Center for Sustainable Business (NYU Stern CSB) announce that they have launched a collaborative research project to quantify the financial benefits and value drivers of impact-oriented multifamily real estate investments in the U.S.
This first-of-its-kind research project will provide the multifamily industry and broader investment community—including pension funds, endowments, high-net-worth individuals, and sovereign wealth funds—with a data-backed, evidence-based approach to demonstrating and evaluating the financial benefits of investing in impact-oriented multifamily housing, according to Bob Simpson, CEO and Founder of MIC.
“With over 40 million Americans calling apartment communities home, and at a time when over 12 million rental households spend more than 50 percent of their income on rent, the potential for real-world impact through investment in this space is resounding,” explains Simpson. “We know from operator reporting and observational evidence that impact strategies in multifamily housing create value for both investors and the communities where they invest. Now is the time for the industry to show empirically the financial importance of these strategies and their place in the institutional investment portfolio.”
The research collaboration will leverage MIC’s Multifamily Impact Framework™, the expertise of MIC members, and the skilled researchers at the NYU Stern Center for Sustainable Business to measure how impact-motivated practices drive financial returns. The research will then be used to create an assessment tool, using the NYU Stern Center for Sustainable Business’ Return on Sustainability Investment (ROSI™) methodology, to aid investors in determining the potential financial benefits of increased capital allocations to affordable, sustainable multifamily housing in the U.S. The tool will also benefit the multifamily operator community in quantifying and rationalizing their impact practices.
“The teams at MIC and NYU Stern CSB have come together with the shared belief that by arming the investment and real estate communities with a clear understanding of the benefits, we can achieve the goal of increasing allocation of investment capital to this sector of the industry,” continues Simpson. “In turn, we can make a real difference in the lives of individuals and families throughout the country, including, but not limited to, improved health and educational outcomes and opportunities to build wealth.”
The MIC Framework is the first industry standard of impact principles and reporting guidelines specific to the multifamily sector. Since its release in September 2023, over 300 organizations have accessed the framework to help guide and bolster their multifamily investment strategies. An updated version of the Framework was released in October as part of an annual enhancement process, in order to ensure the evolution of its reporting and performance standards continue to reflect industry best practices. Simpson adds that the MIC’s membership includes more than 70 of the industry’s leading experts in impact-investing practices representing investors, property owners, service providers, and trade associations in the multifamily sector.
Tensie Whelan, Founding Director of NYU Stern Center for Sustainable Business, and Chisara Ehiemere, Senior Research Lead on the ROSI™ methodology, will serve as research project leaders for the collaborative effort. The ROSI™ assessment methodology has been used by companies such as REI, Eileen Fisher, Anheuser Busch, and Cardinal Health to quantify the financial benefits of sustainable business practices in the apparel, food/agriculture, and healthcare sectors.
“The NYU Stern Center for Sustainable Business was founded on the principle that sustainable business is good business. We are proving that sustainability creates enterprise value,” says Whelan. “We are excited to work with the Multifamily Impact Council to help them quantify the performance of impact investing in multifamily housing and demonstrate the value it can provide to institutional participants in this massive segment of the economy.”
“MIC membership participation is deeply valuable, as it will ensure that the research project is based on practical experience, property level data, and real-world scenarios,” explains Whelan.
