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Hoosier United Methodist News Archives
| Hoosier United Methodists together |
Nov./Dec. 2004 |
United Methodists use investments to help change people's lives
By Linda Bloom
NEW YORK (UMNS) -- In Brooklyn, United Methodist investments have helped convert an unused warehouse into a 400-bed shelter designed to assist the homeless in becoming self-sufficient.
In San Francisco, the church's financial commitment is aiding construction of a "healing center" for Native Americans.
In Fort Worth, Texas, United Methodists helped fund the conversion of a former convent into affordable housing units and arts-related space.
The advocacy work is being conducted through the United Methodist Board of Pension and Health Benefits' affordable housing and community development program. From an initial investment of $25 million in 1990, the program's commitments have grown to more than $900 million, with some $600 million invested as of last June.
The goal is to make a "positive social impact" while still earning financial returns equal to the risk, according to Michael Lohmeier, the program's investment manager.
"What that means is this should be comparable to any other investment that we make on behalf of our participants," he told United Methodist News Service.
To date, the program has seen a 7.5 percent return on the total investment, with loan defaults at less than one-tenth of 1 percent.
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The goal is to make a "positive social impact" while still earning financial returns equal to the risk. |
When the program began in 1990, affordable housing was seen as a primary need across the United States, Lohmeier said. In the past four years, the Board of Pensions decided to broaden its program to include other aspects of community development. "We've been adding on a project-by-project basis," he said.
For the project in Brooklyn, the pension and health benefits board purchased a $15.78 million portion of a $22.15 million permanent loan to finance the Peter J. Sharpe Center for Opportunity. The facility, opened last December, is part of the "Ready, Willing and Able" program of the Doe Fund Inc. Through a variety of strategies, the program has helped more than 1,100 men and women become drug-free and find full-time employment and housing.
For the Peter J. Sharpe Center project, the Board of Pension purchased its portion of the loan under a special financing structure through the Low Income Investment Fund. This 20-year-old community development financial institution has partnered with the Board of Pension before, acting as an "intermediary" on projects.
To spread the risk, the board tries to co-invest with other institutions when possible. JPMorganChase Bank was co-investor on the Doe Fund loan, and its $5 million "participation interest" was used for construction financing, he said.
Earlier development projects include the rehabilitation of 29 single-occupancy rooms into the Margaret J. Bennett House in Baltimore in 2001. Financing for the house, designed for low-income women recovering from alcohol and substance abuse, cost about $9 million. The Board of Pension provided a $2.8 million bridge loan.
The Board of Pension has a video available about the program, Sharing The Dream: A Place To Call Home, which can be ordered online by clicking on resources at www.gbophb.org, the board's Web site.
Linda Bloom is a United Methodist News Service news writer based in New York.
Last updated on 25 Apr 2008