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September 2020 - Part I: Positive Impact Partnership
Part I of a three-part Chestnut Funds’ Viewpoints series on the origin and distinct approach of the Chestnut Opportunity Zone Fund and how investments in Opportunity Zones can play a role in economic recovery.
In 2019, Chestnut Funds and women-led Chestnut Catalyst came together to launch Chestnut Opportunity Zone Fund, LP (“Chestnut OZ Fund”), a multi-asset real estate fund that focuses exclusively on investments in the federally designated Opportunity Zones, which are census tracts facing economic-distress. The shared vision for Chestnut OZ Fund is to help cultivate a more equitable, sustainable, and connected future for communities. Achieving meaningful change requires intention and collaboration, partnerships, and patience. It also requires stewardship of relationships and resources. This is the spirit of Chestnut OZ Fund and our work together to align capital with projects that meet communities’ needs to yield social and financial returns.
In describing the origin of Chestnut OZ Fund’s partnership with the Chestnut Catalyst team, Steen Watson, Chestnut Fund's Co-Founder, and Managing Partner explained:
"Since Chestnut Funds' founding, we have aspired to encourage and support greater gender diversity in the real estate investing industry. Also, we have become increasingly mindful of our role as investors in achieving positive, and mitigating negative, social, and environmental impacts of real estate development and operation. The Chestnut OZ Fund is our first double-bottom line fund and indicative of our increased firm-wide commitment to responsible investing."
Catalyst team helped craft the fund’s investment strategy, integrate the role of impact analysis in the diligence process, and solidify impact targets, which include – quality and accessible job creation, equitable access to goods and services, environmental stewardship, equity in procurement opportunities, and catalytic impact.
Chestnut Catalyst also works to align the Chestnut OZ Fund’s activity with the Opportunity Zones Reporting Framework and will measure and report the impact of Chestnut OZ Fund’s investments.
With help from Chestnut Catalyst, Chestnut Funds continues to actively pursue new Opportunity Zone investments by enriching and expanding relationships with partners and strategic organizations that are embedded in the communities.
The information contained in this newsletter is intended for informational purposes only and is not intended to provide personalized investment advice or to constitute an offer or solicitation to buy or sell securities or interests in any investment. The charts, graphs, and other information contained herein should not serve as the sole determining factor for making investment decisions. This newsletter cannot be reproduced, shared, or published in any manner without the prior written consent of Chestnut Funds (“Chestnut”). Unless otherwise indicated, all statements and expressions in this paper are the sole opinion of Chestnut and are subject to change without notice. Predictions, forecasts, or outlooks described or implied are forward-looking statements based on certain assumptions, which may prove to be wrong, and/or other events, which were not taken into account, may occur. Any predictions, forecasts, outlooks, opinions, or assumptions should not be construed to be indicative of actual events, which will occur. The opinions and data in this newsletter have been obtained from sources believed to be reliable. Chestnut does not warrant the accuracy or completeness of such and accepts no liability for any direct or consequential losses arising from its use. Investing in securities involves risk of loss and should not be based solely on marketing materials including the information provided herein. Further, depending on the different types of investments there are varying degrees of risk. Private Funds managed by Chestnut Real Estate Funds and their investors should be prepared to bear investment loss, including loss of original investment. There is no assurance that any specific investment or investment strategy utilized by Chestnut will be either suitable or profitable for your portfolio. Chestnut does not provide personalized or customized investment advice, therefor you are urged to discuss your personal investment situation with the financial professional of your choice before making or changing an investment in a Chestnut offering.
Because of the inherent risk of loss associated with investing in any type of securities, Chestnut Real Estate Funds is unable to represent, guarantee, or even imply that its services and methods of analysis can or will predict future results, successfully identify market tops or bottoms, or insulate you from losses due to market corrections or declines.
Drawing upon respective backgrounds in strategic consulting, community finance, and venture capital and with a shared desire to drive positive change, Liza Soydan and Courtney Watson launched Chestnut Catalyst to work at the intersections of community engagement, capital, and strategic capacity to benefit people, place, and planet.
In addition to their work identifying investment opportunities for Chestnut OZ Fund, the Chestnut Catalyst team aids other organizations, including Community Development Financial Institutions and Community Development Entities, in measuring and reporting impact.
Chestnut OZ Fund is a Qualified Opportunity Fund (QOF) that provides investors an opportunity to achieve financial benefits, including – capital gains tax reduction, cash flow, long-term appreciation, and important social impacts. The Chestnut