What comes to mind when you envision impact investing?

When you think of impact investing, you might picture solar farms, clean water initiatives, or companies that strive to be good corporate citizens. But impact investing also extends to areas closer to home—like attainable housing, community banking, or healthcare access in underserved areas.

According to the Global Impact Investing Network (GIIN), an impact investment seeks to generate both a financial return and a positive and measurable social or environmental impact. These investments should align with the United Nations’ Sustainable Development Goals (SDGs), which address challenges like climate change, housing, inequality, and poverty.²

Across the U.S., millions of working families face a growing affordability gap. By channeling capital into attainable housing solutions, investors can build thriving communities while also targeting steady, market-rate returns. Firms like DLP Capital have built their strategy around this purpose, combining success with significance.

Concessionary and non-concessionary impact investing in real estate

Impact investments fall into two main categories.

Concessionary impact investments are primarily impact-focused. These investments, which place positive social or environmental outcomes ahead of financial returns, are best suited for investors who do not mind giving up returns in exchange for impact. Examples in real estate include low-interest mortgages for refugees or equity investments in buildings that use more expensive, sustainable materials.

Non-concessionary investments place impact and returns on equal footing, allowing investors to balance purpose with profit without sacrificing either. In private real estate, this often means focusing on middle-income professionals, such as teachers, nurses, and first responders, who are squeezed between high rents and stagnant wages.

Decades of new construction focusing heavily on luxury properties have left a shortage of 4.7 million units.³ This supply-demand imbalance creates both urgent social need and the potential for long-term investment opportunities.

Non-concessionary impact investing: The DLP Capital way

This is the approach taken by DLP Capital, which invests in and finances the building of thriving communities—high-quality, well-located, attainable housing. But how is this approach compatible with non-concessionary, market-rate returns?

DLP’s sponsored real estate equity and credit funds concentrate directly on acquiring and building attainable rental housing or providing flexible loans to experienced operators and developers.

Housing Focus

The DLP Housing Fund and DLP Building Communities Fund invest directly in the acquisition, preservation, and development of attainable rental housing, creating long-term solutions for working families.

Credit Focus

The DLP Lending Fund and DLP Preferred Credit Fund provide financing to mission-aligned operators and developers, enabling them to build, preserve, or improve housing communities that might otherwise struggle to access capital.

Together, these strategies reinforce each other. By pairing housing investment with responsible lending, DLP Capital-sponsored funds expand access for America’s working families to affordable, safe communities while targeting stable, market-rate returns for accredited investors who participate.

CTA: Ready to make a real impact? Target potential returns of up to 13%* and help close the supply gap by investing in ground-up construction with the DLP Building Communities Fund. Learn more today.

FAQs

What are the different types of impact funds?

Impact funds encompass investments that combine market-rate returns with positive impact (e.g. ESG, SRI, non-concessionary impact funds) as well as funds that target positive impact and below-market-rate returns (e.g. concessionary impact investing and venture philanthropy).

What is an example of an impact investment fund?

The DLP Building Communities Fund is an example of an impact investment fund that addresses America’s affordable housing crisis by financing new attainable multifamily communities in the Sunbelt.

What is the difference between grants and impact investing?

Grants are gifts made by foundations to non-profits, while impact investing seeks both social impact and financial returns, which requires repayment or profit-sharing.

What is the difference between ESG and impact investing?

ESG focuses on integrating environmental, social, and governance principles into investment decisions. Impact investing is more outcomes-focused, aiming for measurable social impact alongside financial returns.

How do impact investors make money?

Impact investors earn money like traditional investors through interest on loans, or from distributions, dividends, and capital gains from equity investments.