COMMENT: Patron Capital’s managing director Keith Breslauer says impact investment vehicles that tackle challenging social issues while providing decent financial returns to institutional investors are key to post-pandemic recovery
Last year, homelessness charity Shelter estimated that, in England alone, 280,000 people would wake up on the streets or in temporary housing and hostels on Christmas morning.
This Christmas, the figures could be even more alarming. UK homelessness charity St Mungo’s reported that a third of female rough sleepers said domestic abuse contributed to them becoming homeless. Cases of domestic violence traditionally peak around Christmas, as families tend to spend more time together. But this year, with a global pandemic and numerous national and regional lockdowns over the course of the last 12 months, Christmas will exacerbate an already critical situation.
The UN has estimated that cases of domestic abuse worldwide have increased by 20% due to the pandemic, as victims have been trapped with their abusers. In the UK, two-thirds of women in abusive relationships suffered more violence from their partners during the spring lockdown, according to a report by Women’s Aid. Meanwhile, Refuge, the UK’s largest domestic abuse charity, reported a 700% increase in visits to its website in a single day, while figures show that one in five crimes during lockdown was domestic abuse related.
The Women In Safe Homes fund plans to buy assets to address the lack of affordable accommodationfor women at risk of homelessness
Even prior to the pandemic, 64% of women referred to specialist refuges were being turned away, while half were unable to accommodate women with two children, according to Women’s Aid. During the spring lockdown, campaign groups Southall Black Sisters and Compassion in Politics wrote to hotel chains asking them to open up rooms to those fleeing abuse. Some did but, while laudable, this is hardly a long-term solution and merely highlights the dire shortage of appropriate accommodation.
Charities and governments simply do not have the funds available to create more homes for women, who too often are forced to choose between homelessness and domestic abuse. But tapping into a growing desire from institutional investors to deliver benefits to society alongside returns to shareholders could provide an answer.
The Women In Safe Homes fund is an example of a vehicle seeking to do just that. The world’s first gender-lens property fund, it plans to buy assets to address the lack of affordable accommodation, and partner with charities to provide safe and secure homes for women experiencing or at risk of homelessness.
The fund is unique in combining private capital and government rental support to work with charities to provide long-term social solutions. It will acquire and refurbish properties and lease them to charity partners under 10-year leases. Its partners will in turn lease the properties to their clients, at a rent that is ultimately sponsored by the UK government housing benefits scheme.
At the same time, charity partners such as the social justice charity Nacro will provide specialist and housing support to help women recover from abusive or difficult relationships, enabling them to find stability and rebuild their lives, sustaining their tenancies and, ultimately, moving on.
The Women In Safe Homes Fund is set up as a 10-year fund with a targeted ungeared annual return of approximately 5% to 7% from rental income. Moderate levels of leverage may be considered once the portfolio is stabilised, and the fund is open to institutional, pension fund and professional investors, both in the UK and internationally.
Impact investing offers the components to satisfy the needs of all stakeholders, from charities and their beneficiaries to institutional investors
The pandemic has shone a light on underlying social issues, meaning we cannot and should not go back to business as usual and forget about those who need our help.
However, the most significant impact will not be made simply by giving or increasing allocations to charity. Impact investing offers a much more sustainable approach, offering the components to satisfy the needs of all stakeholders, from charities and their beneficiaries to institutional investors. There is a significant need for models like the Women In Safe Homes fund to be replicated to help tackle other social issues while also providing a decent return to organisations with significant funds to invest but who are obligated to generate cash for their members.
Models that consider multiple perspectives and successfully navigate the tricky path of fulfilling both social and financial needs will be key in helping us to build back better in the post pandemic world, ready for when the next shock hits.
Keith Breslauer is the managing director of Patron Capital
Covid-19 pandemic domestic abuse Women In Safe Homes fund homelessness impact investing