In an effort to generate risk-adjusted market rates-of-returns and to promote economic development within New York City, the Teachers’ Retirement System of the City of New York, the New York City Employees’ Retirement System, the New York City Police Pension Fund, the New York City Fire Pension Fund and the Board of Education Retirement System of the City of New York (collectively, NYCRS) allocate 2% of pension assets towards Economically Targeted Investments (ETI). The ETI program is designed to address market inefficiencies by providing capital or liquidity to underserved communities and populations citywide.
The ETI program’s investments have historically been targeted towards affordable or workforce housing for low, moderate and middle income neighborhoods and populations in the five boroughs. These ETIs have helped to revitalize neighborhoods by returning distressed properties to the City’s tax rolls and by developing new housing that is affordable to working people. Since the ETI program began in the 1980s, $4.5 billion has been invested in New York City’s five boroughs and the six surrounding New York counties.
NYCRS current active ETI investments include:
The Access Capital Strategies (ACS) Separate Account
NYCRS collectively have $450 million committed in the ACS Separate Account, an affordable housing/anti-predatory lending strategy established in 2007. The account, managed by RBC/Access Capital, primarily invests in single-family mortgage backed securities (MBS). One of the program’s goals is to provide a source of fairly priced mortgages for low-, moderate- and middle-income home purchasers, including minority and women purchasers who might otherwise be vulnerable to predatory lending practices. Every loan in a MBS is screened to determine that it provides a safe, non-predatory-termed loan to the home purchaser. The income of eligible borrowers must be less than 200% of area median income (AMI), which in 2023 is $282,400 for a family of four.
An additional goal of the program is to strengthen the secondary market for loans targeted to these segments of the population and encourage additional, similar bank lending. The program may also invest in multifamily housing or investments that are designed to support underlying community development activities targeted to low- and moderate-income neighborhoods.
RBC Access Capital Strategies Collateral Benefit Report as of 12/31/2023 (Inception: 2/1/2007)
| Investment ($MM) | Total Units | |
|---|---|---|
| Multifamily | $388.18 | 43,846 |
| Single Family | $773.67 | 2,916 |
| Other | $9.04 | 17 |
| Total | $1,171.30 | 46,779 |
NYCRS began investing in HIT in 2002 and as of December 31, 2023, had $849 million invested in the Trust. Although the Trust is national in scope, it has historically demonstrated a deep commitment to financing affordable housing in New York City. Since 2002, HIT has invested $1.7 billion to create or preserve multifamily and workforce housing in New York City for over 37,041 affordable apartments. Projects must use union labor and have included 11 Mitchell Lama buildings and the historic Penn South Cooperative in Manhattan.
AFL-CIO Housing Investment Trust Collateral Benefit Report as of 12/31/2023 (Inception: 12/31/2002)
| Investment ($MM) | Total Units | |
|---|---|---|
| NYC Community Investment Initiative | $704.09 | 21,317 |
| NYC Workforce Housing Investments | $293.60 | 9,339 |
| HIT Housing Investment Strategy | $702.16 | 6,385 |
| Total | $1,699.85 | 37,041 |
The program invested $1.6 billion for the preservation or construction of 45,163 affordable apartments as of September 30, 2023. Many of these ETIs have also created jobs in the construction industry and helped grow small businesses.
The Public Private Apartment Rehabilitation Program (PPAR)
The program invested $1.6 billion for the preservation or construction of 45,178 affordable apartments as of December 31, 2023. Many of these ETIs have also created jobs in the construction industry and helped grow small businesses.
The current eleven private and not-for-profit lenders for the PPAR program are:
- Bank of America Merrill Lynch
- Carver Federal Savings Bank
- Citibank Community Development
- Bellwether Enterprise
- New York City Housing Development Corporation (HDC)
- JP Morgan Chase
- Low Income Investment Fund
- Local Initiatives Support Corporation (LISC)
- Neighborhood Housing Services of New York City
- The Community Preservation Corporation
- Wells Fargo
Applications from lenders wishing to participate in the PPAR program are accepted on a rolling basis. See RFPs & Solicitations (under Asset Management and Related RFPs).
Request for ETI Proposals
The Comptroller’s Office intends to expand its ETI programs in an effort to achieve new ways of generating strong investment returns to NYCRS and create new opportunities for economic growth and development in New York City. An open-ended Request for Proposals (RFP) for Economically Targeted Investments is currently available on RFP and Solicitations page. For more information, please email ETI@comptroller.nyc.gov.
Disclaimer: Information presented is current as of the date of this posting only. Past performance does not guarantee the future performance of any manager or strategy. The performance results and historical information provided herein may have been adversely or favorably impacted by events and economic conditions that will not prevail in the future. Therefore, these results are not indicative of the future performance of any strategy, index, fund, manager or group of managers.