SDS Capital Group Named to ImpactAssets 50 List for Fourth Consecutive Year

BETHESDA, Md. – March, 2021— For the fourth consecutive year, SDS Capital Group (SDS) has been named to the ImpactAssets 50 (IA 50) Global Impact Fund list—the impact investing industry’s leading database of private capital fund managers.

SDS once again earned its selection as an IA50 manager based on a competitive application process, which this year drew a record number of applicants. Now in its 10^th year, the IA 50 list is used by financial advisors, institutional investors, individual investors and family offices to assess funds that deliver social and environmental impacts as well as financial returns. 

Despite a tumultuous year, total assets under management (AUM) among selected fund managers jumped to a record $228 billion in 2020, up from $181 billion in 2019. SDS is one of 13 managers on this year’s list that reported assets exceeding $1 billion.

“It is an honor to be selected by ImpactAssets 50 for four years running,” said SDS Capital Group CEO and Founder Deborah La Franchi. “It is very gratifying to see impact investing’s heightened visibility among institutional investors. When SDS was launched in 2001, there was virtually no investor base for our impact funds. Such funds were little understood and extremely challenging to launch. Interest in impact investing has grown considerably over the past few years.”

Being selected as an IA 50 manager has become increasingly competitive. “The growth we’ve seen in the IA 50 over the past decade reflects the growth, maturity, and increased diversity of the impact investing industry as a whole,” said Sandra Osborne Kartt, CFA, Director, Investments, ImpactAssets. “This year’s IA 50 represents the vast array of impact themes and strategies available to impact investors today.” 

SDS was selected for the IA 50 2021 class based on its commitment to meaningful impact, diversity of communities in which investments are made, diversity of staff, and strong track record of delivering market or above market rates of return. 

In addition to being an early entrant in the impact investing space, SDS Capital Group is noteworthy because it is 100% woman-owned – a distinction that sets it apart in the private equity real estate fund industry. According to private capital advisory firm Bella Research Group, just $3 of every $1,000 of assets under management in real estate funds is managed by a woman-owned firm.

SDS currently manages over $1 billion in impact assets. Its investments have helped create more than 8,500 jobs and nearly 3,000 units of affordable and workforce housing in underserved communities with an average poverty rate of 31% and populations that are on average 58% minority. 

“We’re on track over the next five years to achieve the same level of investment and impact that we achieved over the previous 20 years,” added Ms. La Franchi. The growth of SDS’s existing and trailblazing new funds will help us accelerate the funding timeline and transform a growing number of our country’s poorest communities.”   

Of note, SDS recently launched its groundbreaking SDS Supportive Housing Fund in 2020. This first-of-its-kind private equity fund finances permanent supportive housing for Californians experiencing homelessness. The Fund, which has a goal of financing 1,800 housing units, is presently capitalized at $106 million and has made four investments. It serves as the sole source of capital for the developments it finances, which have a per-unit cost of $200,000 (less than half the typical market cost). The developments do not require taxpayer subsidy for land acquisition or construction. The Fund’s housing projects also provide case management services to each tenant. SDS’ innovative approach was recently featured in the Los Angeles Times and on KNBC-TV.

The lead investor for the SDS Supportive Housing Fund is Kaiser Permanente, which invested $50 million. As the nation’s largest nonprofit integrated health system, Kaiser Permanente has a long track record of supporting efforts to end homelessness and making impact investments.

John Vu, Kaiser Permanente’s national vice president for community health, said, “Two critical factors cemented our decision to invest $50 million with SDS Capital Group. The first was SDS’s track record of strong financial diligence and stewardship of investor capital. The second was its deep commitment to investing in our nation’s most underserved populations. We are excited to be  a partner with SDS as they continue to grow their impact investment strategies.”

Kartt and Jennifer Kenning, Co-Founder and CEO of Align Impact and IA 50 Senior Investment Advisor, led the teams that performed the application scoring and analysis process for this year’s IA 50 list. 

See SDS’s IA 50 2021 profile here.