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Minnesota Impact Investing Initiative results in 500 affordable homes for Minnesota residents

Over $112 million in capital invested in low-income communities as Minnesota faces one of America’s largest wealth gaps

MINNEAPOLIS, October 11, 2022 – The Minnesota Council on Foundations (MCF) and several Minnesota foundations today announced the five-year milestone of the Minnesota Impact Investing Initiative (MI3). Since its inception, this investment collaboration has successfully supported access to homeownership and affordable multifamily housing for over 500 low-income families across the state of Minnesota, where there is one of the largest racial homeownership gaps in the United States.1

Minnesota foundations and public entities have invested more than $112 million into the impact investing collaboration over the past five years. These assets are invested in a fixed income investment strategy managed by RBC Global Asset Management (RBC GAM). The investments have spanned 32 different counties in Minnesota. To date, the MI3 program has funded 560 affordable homes and a dozen affordable multi-family projects for low-moderate income (LMI) families (defined as those earning less than 80% of area median income). Eighty-two percent of the affordable properties are located in Black, Indigenous, and People of Color (BIPOC) neighborhoods while 81% of the recipients are women-headed households. Each loan averages $250,000. In addition, the MI3 has funded small business loans and health care facilities supporting a total of 200 nursing home beds.

Access to affordable housing is especially relevant in Minnesota where there is one of the largest wealth gaps by race in all of America, according to WalletHub. The homeownership rate for Minnesota BIPOC households decreased from 46% in 1940 to 44% in 2019 while the homeownership rates for white families in Minnesota increased steadily from 55% to 77% during the same time, according to the Federal Reserve Bank of Minneapolis. Furthermore, the poverty rates for African American and Indigenous residents are at least three times higher than for white Minnesotans, according to the University of Minnesota.

“Investing for impact is a critical strategy for foundations and other institutions to help address wealth disparity in Minnesota,” said Susie Brown President of the Minnesota Council of Foundations. “By doing so, more capital is available for affordable housing and other critical needs, with a local focus. Building a fund of over $100 million in just five years represents significant progress toward addressing important community development needs.”

MCF launched MI3 in 2017 as a first-of-its-kind impact investing collaborative in the United States, led by the Minnesota Council on Foundations, and several other Minnesota foundations in partnership with RBC GAM. Over the past five years, MI3 has built support for impact investments targeting communities in need in Minnesota. The McKnight Foundation, Bush Foundation, Otto Bremer Trust and the Minneapolis Foundation were among the first institutions participating in the impact investing collaborative. They created MI3 in 2017 to strengthen Minnesota’s market for affordable housing and small business and grow the number of Minnesota-based foundations involved in impact investing.

"We are proud to participate in the Minnesota Impact Investing Initiative and to see how it has grown," said Elizabeth McGeveran, Director of Investments at the McKnight Foundation. "The innovative approach has created opportunities for a wide range of investors to make a local impact in Minnesota while benefiting from geographically diversified financial performance."

Assets dedicated to MI3 are invested in the RBC Access Capital Community Investment Strategy, a fixed income investment strategy managed by RBC GAM. The investment strategy seeks to positively support home ownership, job creation, small business growth, and increased access to rental housing, healthcare, and education in Minnesota. Local loans are assessed for social impact and purchased, then pooled to create custom securities for RBC GAM’s clients, such as MI3 members. Any investor, financial advisor, large corporation or foundation can make investments into MI3 with the aim of supporting community development efforts across Minnesota.

RBC GAM’s Access Capital Community Investment team has developed a track record of working with governments and institutional investors. These investors invest in customized U.S. agency guaranteed mortgage-backed securities and government-backed loans and municipal securities that support social impact themes. As of May 31, 2021, the Access Capital Community Investment Strategy has more than $1.5 billion USD in assets under management.

“MI3 is a great example of how the broader region can come together to help provide access to capital in low-income communities,” said Ron Homer, Chief Impact Strategist, RBC GAM. “The global pandemic produced stark disparities in economic impact and health outcomes within low-income and BIPOC communities which exacerbated the already troublesome issue of income inequality in America. As we look forward, RBC GAM will continue to partner with foundations across America to make targeted investments that aim to reduce these inequalities while fostering economic growth and other positive social outcomes.”

Since MI3 was established in 2017, there have been several other communities across America have replicated the impact investment collaboration.

MCF is planning to celebrate the five year milestone of the MI3 at its Semi-Annual Meeting in Minneapolis, in February 2023.

For more information on MI3, visit RBC GAM’s MI3 Impact Summary.

About the Minnesota Council on Foundations
The Minnesota Council on Foundations (MCF) is a vibrant philanthropic community working collectively to advance prosperity and equity. MCF members represent three-quarters of all grantmaking in the state, awarding more than $1 billion annually. For more information, visit

1 Source: Federal Reserve Bank of Minneapolis. (Link)