APG, on behalf of its pension fund client ABP, recently participated as an anchor investor in Calvert Impact Capital’s latest Community Investment Note® (“Notes”). The initial $20MM investment is expected to support the development of more than 350 new affordable housing units in the United States. APG’s Joshua Linder (Senior Credit Analyst, Lead Sustainability Research), Simone Andrews (Senior Responsible Investment Manager), and Adam Hynes (Senior Portfolio Manager) discuss the specifics of this impact investment.
Published on:
18 May 2026
In brief
• This investment delivers real-world impact through the creation of new affordable rentals targeting low to very low-income earners.
• The structure offers attractive credit enhancement, including subordinated capital, loan level guarantees on certain transactions, and a net asset base.
• Both the transaction itself and the broader partnership with Calvert Impact offer strong scalability within APG’s impact mandate, while offering positive risk-adjusted returns.
This transaction represents the third impact investment undertaken by APG’s US Credits team under the ABP credit impact mandate. While Community Investment Notes finance a diversified portfolio across multiple impact themes, APG’s investment focuses on the creation of new affordable multifamily rental housing in the United States.
What considerations led APG to prioritize this segment within its current impact strategy?
Simone Andrews: “There is a persistent and widespread shortage of affordable housing nationwide, estimated at between two and seven million homes. Low‑income households face a substantial and growing gap between incomes and housing costs. This investment creates a unique opportunity to help shape the type of housing being brought to market, specifically targeting the most vulnerable populations, including low‑ and very‑low‑income households and seniors.”
Joshua Linder: “The investment falls within the impact mandate that the Credits team received approval for from ABP last year. Within that mandate, we have specific impact investment targets and themes that ABP developed together with APG. Affordable housing is explicitly targeted, provided the investment adds additional affordable rental supply.”
Given the focus of this investment, how does APG define affordability?
Simone Andrews: “Our definition of affordable housing is based on US federal standards. In simple terms, housing is considered affordable when a household spends no more than 30 percent of gross income on housing costs. Keeping costs below 30% helps households afford other non-discretionary expenses like healthcare or childcare.”
“The income thresholds are determined using Area Median Income (AMI), calculated at the state and county level by the US government using Census data. All housing targeted through this investment are expected to be restricted to households earning up to 80 percent of area median income.”
What structural challenges affect new developments, and where does APG’s capital add the most value?
Simone Andrews: “A major challenge is that these projects serve low‑income renters, which means they typically require significant public subsidies or other gap-filling capital. At the same time, the housing market remains difficult, with still‑elevated interest rates and high construction and land costs.”
Joshua Linder: “From an impact standpoint, there is also an access‑to‑capital issue. Developers building these projects often lack sufficient financing. By providing capital, we enable them to move faster and to build at greater scale.”
“That is where the additionality comes in. Without this incremental capital, these projects might take longer or would not be executed at the same scale. Our investment accelerates development and brings new affordable housing units to market sooner.”
How are impact and additionality reflected in the financial structure of the transaction?
Adam Hynes: “The investment provides comparable risk-adjusted returns while also offering diversification relative to a typical US corporate bond. The structure includes multiple layers of protection for our senior position. There is subordinated capital beneath our tranche, loan‑level guarantees on certain transactions, and a net asset base.”
“Calvert Impact Capital also has a very long impact investment track record. Over more than 30 years, they have repaid 100 percent of principal and interest to all investors, while maintaining a cumulative underlying portfolio loss rate of less than 1%.”
What monitoring and reporting arrangements govern the investment over its life cycle?
Adam Hynes: “From a financial standpoint, we receive formal financial reporting on a quarterly basis. This enables us to provide timely internal updates, including the quarterly or semi‑annual reporting we deliver to leadership for all impact investments, including Calvert Impact.”
Joshua Linder: “From an impact perspective, the reporting framework is equally robust. A key element is transparency. Together with Calvert Impact, we moved beyond portfolio‑level reporting and established reporting at a more granular project level. That gives us clear visibility into where the capital is deployed and what impact it generates.”
Beyond transparency, what distinguishes Calvert Impact as a partner for this investment?
Joshua Linder: “In the US market, Calvert Impact is widely regarded as one of the longest‑standing and most reputable impact investors. They were active in this space well before impact investing became a recognized discipline.”
“For us, partnering with Calvert Impact is a significant opportunity. It allows us to work with a highly credible organization while helping to scale their strategy and impact.”
How does that partnership support scaling this approach beyond the initial transaction?
Joshua Linder: “We also see our relationship with Calvert Impact as a long‑term partnership. Over time, we may provide capital for other impact areas beyond affordable housing, provided Calvert Impact can meet our impact and reporting requirements. In that sense, both this transaction and the broader partnership should be scalable.”