For anyone seeking to access lending for community development projects, understanding the different types of loans can be confusing.
At Capital Impact Partners, our commitment to fostering positive social impact drives us to support mission-aligned real estate developers and community development leaders with a range of flexible and affordable financing solutions.
Our community development lending offerings include predevelopment loans, real estate acquisition loans, construction loans, working capital loans, refinance loans, New Market Tax Credit (NMTC) leverage loans, and NMTC Qualified Low-Income Community Investment (QLICI) loans.
Our loan products are designed to help our borrowers achieve their goals and revitalize communities, whether that constitutes developing or preserving affordable housing, creating jobs through a small business, or building the resilience of communities through access to health care, healthy food, and education.
In this series of blogs, we aim to shed light on the diverse types of loans we offer and explore their significance within the context of Capital Impact’s mission-driven financing, in the hope that it will provide clarity to help borrowers make informed decisions about applying for community development loans.
We walk through the different types of loans we use to support developers and community leaders in bringing their community-centered projects to life:
As a mission-driven developer, organization, or business looking into community development projects, you may be coming across language that might sound confusing and be challenging to understand. What is a CDFI? What is NMTC? What is LTV?
At Capital Impact Partners specifically, we offer flexible and affordable financing to a broad range of community development projects that deliver social impact, including community health centers, public charter schools, small businesses, cooperatives, healthy food retailers, affordable housing developments, and dignified aging facilities.
This glossary aims to demystify terms to help you navigate through our lending and programmatic services and offerings. Below you will find definitions of terms divided into the following thematic sections:
Community Development Financial Institutions (CDFIs)
Community Development Financial Institutions (CDFIs) are mission-driven private sector financial institutions that focus on serving people living with low incomes and people who have historically been locked out of the financial system. Their work entails providing lending for small businesses and community projects, affordable housing, and essential community services in the United States.
As a CDFI, Capital Impact Partners has delivered community facility financing, capacity-building programs, and impact investing opportunities to champion key issues of equity and social and economic justice since 1982.
Community Development
Community development activities tackle underestimated populations that do not have equitable access to affordable housing, health care, healthy food, and education, nor connections to capital, entrepreneurship, and quality jobs, to help them become stronger and more resilient.
At Capital Impact Partners, and together with the Momentus Capital branded family of organizations, we offer a continuum of capital products and services to transform how capital and investments flow into underestimated communities and drive community-led solutions that support economic mobility and wealth creation.
Lending Process
Capital Stack
Debt coverage ratio (DCR) is a measurement of a firm’s available cash flow to pay current debt obligations. While a DCR of 1.25 is the minimum requirement for most lenders, a higher number — such as 2 — shows lenders you are financially stable and can repay your debts. A higher DCR can also mean a potentially lower interest rate as lenders see you as less of a risk for defaulting on your loan.
Loan Term
The term of a loan is the period of time a borrower has to repay the loan. This choice affects their monthly principal and interest payment, their interest rate, and how much interest they will pay over the life of the loan.
A term sheet is a nonbinding agreement that shows the basic terms and conditions of an investment. The term sheet serves as a template and basis for more detailed, legally binding documents. Once the parties involved reach an agreement on the details laid out in the term sheet, a binding agreement or contract that conforms to the term sheet details is drawn up.
Underwriting
Underwriting is the process of your lender verifying your income, assets, debt, credit, and property details to issue final approval on your loan application.
Loan Types
Predevelopment Loan
A predevelopment loan serves as a critical lifeline during the earliest stages of a development project. It specifically targets the upfront costs associated with project planning and preparation, enabling developers to refine their visions and align them with the needs and aspirations of the communities they aim to serve. This loan bridges the gap between concept and execution, ensuring a solid foundation for success.
Real Estate Acquisition Loan
A real estate acquisition loan is a type of loan that is used to purchase real estate. This type of loan is often used by community developers to acquire existing property or development land that they plan to preserve or redevelop for affordable housing, commercial development, or other community-benefit purposes.
Construction Loan
A construction loan is a short-term loan that propels your development project from the drawing board to a physical structure. It provides the necessary funding to cover the costs associated with building, renovating, or expanding community assets. Construction loans may also cover the costs of buying land, drafting plans, taking out permits and paying for labor and materials. Construction loans typically have higher interest rates than other types of loans because lenders are taking on more risk by financing the construction of a new property.
Business Acquisition Loan
A business acquisition loan is a financial instrument designed to provide funding for individuals or businesses to purchase an existing business. These loans are often sought by entrepreneurs looking to expand their business portfolio, individuals seeking to become business owners, or existing business owners interested in diversifying their operations by acquiring complementary businesses. In the case of community developers, the specific goal would be to further community development initiatives.
Loan Refinancing
A refinance refers to the process of revising and replacing the terms of an existing credit agreement. Borrowers usually choose to refinance a loan seeking to make favorable changes to their interest rate, payment schedules, or other terms outlined in their contract. If approved, the borrower gets a new contract that takes the place of the original agreement.
New Market Tax Credit (NMTC) Qualified Low-Income Community Investment (QLICI) Loan
The capital that a community development entity provides to a qualifying project is known as a Qualified Low-Income Community Investment (QLICI) and it is a seven-year, interest-only loan.
Health Care
Integrated Care
Integrated care is a unique approach to health care that is characterized by close collaboration and communication between multiple doctors and healthcare professionals. In other words, it is a type of healthcare where all of your doctors work together to solve issues with your physical, mental, and behavioral health. At Capital Impact, we support the Integrated Care model because it improves the quality of care, promotes better health and lower costs while creating thousands of jobs, spurring economic development.
PACE (Program of All-inclusive Care for the Elderly)
Area Median Income is the income for the median household in a given region. If you were to line up each household from poorest to wealthiest, the household in the very middle would be considered the median.
Tenant Opportunity to Purchase Act (TOPA)
TOPA, or “Tenant Opportunity to Purchase Act”, is a type of anti-displacement housing policy that gives tenants options to have secure housing when the property they rent goes up for sale, while also preserving affordable housing.
Cooperatives
Food Co-ops
A food co-op is a grocery store that is totally independent and owned by the community members who shop there. An illustrative example is ChiFresh Kitchen, a food co-op owned by justice-involved Chicagoans. ChiFresh won a Co-op Innovation Award and was not only able to continue its expansion, but also pivot to provide freshly cooked and culturally appropriate foods to those impacted by COVID-19.
Housing Co-ops
A housing co-op provides an alternative to the traditional methods of acquiring a primary residence. It is a type of residential housing option that is actually a corporation whereby the owners do not own their units outright. Instead, each resident is a shareholder in the corporation based in part on the relative size of the unit that they live in. Capital Impact Partners has helped ROC USA, a nonprofit that helps residents form cooperative corporations to purchase their manufactured home communities from private owners and manage their neighborhoods in perpetuity. They have gone on to become a powerhouse in this area, helping thousands of residents become homeowners and community stewards.
Worker Co-ops
Worker cooperatives are values-driven businesses that are owned and operated by their employees. Capital Impact has made a $1 million preferred equity investment in Obran Cooperative, a unique company that operates a number of worker-owned healthcare companies.
Worker Co-op Conversions
Worker co-op conversions – or employee ownership conversions – occur when businesses transition from a traditional ownership structure to employee ownership. Essentially, the business owner sells the business to the employees. These conversions (PDF) can drive company productivity while rewarding the people who are contributing to the company’s success, as well as helping to preserve the company’s mission and values.
In 2021, Capital Impact Partners financed the worker co-op conversion of Ward Lumber. This new cooperative is another example of the power of worker co-op conversion to maintain and increase wealth and stability within communities.
In 2021, Capital Impact Partners and the Government of the District of Columbia – along with a group of partners – launched the Nourish DC Collaborative, an initiative that supports the development of locally owned food businesses in D.C. communities to create vibrant, healthy neighborhoods.
Nourish DC offers flexible loans, grants, and technical assistance to emerging and existing food businesses. While it serves the entire District, the collaborative focuses on supporting businesses in underestimated neighborhoods.
In this blog series, learn how food business owners are supporting their local communities and how technical assistance offered through Nourish DC helped them create change.
Culinary skills and a passion for food are often the sparks behind a new food business. But entrepreneurs also need a broad set of skills in administration, operations, marketing, finance, and human resources. Nourish DC supports new and growing food businesses in the D.C. metropolitan area by funding technical assistance (TA) in these and other areas critical to success.
Nourish DC is committed to providing TA that is culturally appropriate, multilingual and responsive to the needs of businesses. Because these needs change over time as a business evolves and matures, Nourish DC aims to be flexible and meet entrepreneurs where they are.
“Each business has different needs, depending on its stage, sector and expertise,” says Alison Powers, director of Economic Opportunities for Capital Impact Partners. “TA for start-ups will lay the foundation for success, but TA is needed at every stage of growth.”
Food entrepreneurs gain skills in administration, operations, marketing, finance and human resources thanks to technical assistance from Nourish DC.
The COVID-19 pandemic added new challenges — such as cost inflation, supply shortages, and a tighter labor market — further fueling the need for TA. “There was already a line out the door for TA,” Powers says. “It doubled as companies grappled with meeting the changes and challenges of the past three years.”
Another important benefit of TA: “Businesses that have received extensive TA are typically more ready for financial capital, such as a loan or grant,” said Powers.
Leveraging the Power of Collaboration to Support Businesses
Nourish DC uses a collaborative structure, bringing together the strengths of mission-driven organizations to support food business owners. The Nourish DC Collaborative partners providing TA – including Dreaming Out Loud, Latino Economic Development Center, Wacif, EatsPlace, and CDC Small Business Finance – have deep community knowledge and connections. A partnership with the Latino Economic Development Center (LEDC) is helping to incubate and launch new food businesses through a robust TA program that includes its Food Venture Initiative (FVI). The eight-month program includes three months of intensive TA followed by five months of access to commercial kitchen space at Union Kitchen, which is subsidized by Nourish DC and Union Kitchen.
The Nourish DC Collaborative partners providing TA have deep community knowledge and connections.
According to Alexandra Samaniego, LEDC’s Program Manager, D.C. for Small Business Programs, 90 percent of LEDC clients are immigrants. If immigrants are not able to find employment, many choose to start a business — typically in the food, construction, or service industries. As a result, she says, there is a huge need for food-industry support. “Most entrepreneurs know how to make food; they need help running the business. We give them a roadmap to starting a food business. Even if they were an entrepreneur in another country, it’s different here.”
From PhD to Small Business Owner
Nigeria native Oluwatobi Osobukola-Abubu was surprised, but excited, to find herself part of the first Food Venture Initiative cohort. Even though her mother was a cook and caterer in Nigeria, Abubu never imagined that future for herself. She came to Washington, D.C., in 2013 for a diplomatic position at the Nigerian Embassy. Already the mother of one (a two-and-a-half year-old daughter, age 2-1/2), she was pregnant with her second child, a son, when she arrived. Once here, she began working on a PhD in African Studies at Howard University, intending to focus on trafficking victims and help them use entrepreneurial skills as part of their recovery.
Abubu’s plans changed when her position with the embassy ended in 2017 and her son, then nearly 5, received an autism diagnosis. She knew she wouldn’t be able to find the support he needed back home, and she was committed to finishing her PhD. She chose to stay in D.C. and find new work with the flexibility to meet her family’s needs.
Oluwatobi Osobukola-Abubu built her food business Fritters & Roast from scratch, with the help of technical assistance from Nourish DC.
From her time at the embassy, Bubu knew there were few authentic Nigerian food options in the D.C. area. She also knew how much her friends and neighbors enjoyed the home-cooked Nigerian foods she shared generously with them. When the COVID-19 pandemic hit, Abubu began looking for resources to help the small, home-based food businesses she knew. That’s how she connected with LEDC at her local library. LEDC staff were promoting the FVI, and after hearing her story, encouraged her to apply.
Supporting Business Owners with Strong Foundations
LEDC initially provided 1:1 and group TA and training (e.g., webinars) to clients, but now offers more structured support through FVI. LEDC began providing TA in April 2023 to 10 program participants. The participants moved to the commercial kitchen in August and will have access to it through December 2023.
Powers and Samaniego both emphasize the importance of providing commercial kitchen space as part of the FVI program. Access to such space, which is especially critical as businesses begin to scale up, is both limited and costly in the D.C. area — typically around $2,000 per month. That cost either puts it out of reach for food start-ups or consumes the limited start-up capital they have.
According to Samaniego, the organization also hopes to target future TA to two distinct groups of entrepreneurs:
Those just starting out or in early growth stages who need broad training and support, and
Those more established who need targeted training and support to address specific business needs.
LEDC hopes to expand the FVI program and offer two sessions each year — one starting in the spring and one starting in the fall.
Building a Food Business from Scratch
Abubu launched Fritters & Roast in 2022. Taking the advice of her LEDC coach, she started small, focusing on simple “finger foods” that are popular in Nigeria, such as bean cakes, banana fritters and plantains. She made them available in quantities suitable for individuals and families. She later added cassava chips and two flavors of a Nigerian hibiscus drink (pineapple/lemon/ginger and watermelon/lime), which has been popular with customers. She holds sampling events and sells her products through farmers markets and online, with plans to create packaged products for retail stores. She also offers catering services.
With technical assistance through Nourish DC, Oluwatobi Osobukola-Abubu is now able to sell her authentic Nigerian finger food with D.C. communities.
The most challenging aspect was “starting completely from scratch on everything,” Abubu says, including marketing herself and her business. Which is why she values the depth and breadth of support she has received from LEDC — and her friends and neighbors, who stepped in to help test menu offerings, design her logo and menu, and build her website. Access to the commercial kitchen has been valuable in many ways. She appreciates not only the facility but the “ecosystem of support” she is building with other food entrepreneurs.
“I never saw myself as one to do the business myself,” says Abubu, whose children are now 12 and 9. “But LEDC saw that and were able to bring it out. If they hadn’t gotten me into the initiative, I wouldn’t have been able to bring that gift out. That’s the amazing thing LEDC did for me.”
2022 is a special year for us at Capital Impact Partners as it marks our 40th anniversary. Four decades of leaning into helping people build communities of opportunity and developing pathways to success.
And while this is an exciting time for us as we embark on a new strategy under Momentus Capital, it is equally important to remember our roots as a champion for the cooperative movement.
Co-ops represent a cultural shift away from blind profit toward shared social benefit. It is a model that challenges the status quo and offers workers, especially workers of color, an alternative to extractive systems.
These principles not only shaped our work in the very beginning, but continue to anchor our strategy as we grow and evolve and develop new business lines and affiliate organizations. They even underpin our newest vision statement to help create an economic system that respects and uplifts all peoples’ right to achieve the dreams they have for themselves, their communities, and generations to come.
Our Co-op Beginning
While we are now a national organization of nearly 300 staff members across our family of organizations, Capital Impact’s beginnings were quite humble.
One our our first pamphlets…many names ago.One our our first pamphlets…many names ago.
In 1978, Congress rightly saw the need to better support the cooperative movement. That led to the passage of the National Consumer Cooperative Bank Act and the creation of the National Cooperative Bank.
Four years later, a tiny division known as the Office of Self-Help Development and Technical Assistance was launched to provide more focused work on bringing co-ops to underestimated communities and contribute to the economic development for people living with low-to-moderate incomes.
Over time, this effort grew and went through several different names before becoming Capital Impact Partners – the nonprofit Community Development Financial Institution we are today.
To date, Capital Impact has lent nearly $315 million in support of food, worker, and housing cooperatives, and has provided $725,000 in grants for co-op development.
More important than the numbers is the incredible journey of discovery to imbue our work with a co-op lens and shape the impact we can have with communities. It is a journey that has cemented our role as a mission-driven organization dedicated to fostering health, wealth, and justice for underestimated communities.
Expanding to Support Community Development
As our cooperative work expanded across the country, so did our support for community development more broadly. We saw that, for communities to be healthy and thrive, they needed a spectrum of vital social services, from health care to education to affordable housing.
Farmers workers in California often have very little access to health care, so OLE Health takes health care into the fields.
Some of my favorite stories are about projects we’ve financed over the years that have had great impact on their respective communities. Like OLE Health, a health care provider in Northern California that recognized roadblocks to patient care and created programs to meet patients where they are. And Montessori for All, a free public charter school in Austin, Texas dedicated to “diverse-by-design” education, with a mission of achieving equitable academic outcomes for students across socioeconomic levels.
California farmworkers receive health care at a makeshift clinic created by OLE Health.
It was also a time where we expanded our approach to not just think as a lender, but how we could amplify community development through other organizations.
That led to Capital Impact joining with several leading nonprofit organizations to help form ROC USA Capital, a nonprofit that helps residents form cooperative corporations to purchase their manufactured home communities from private owners and manage their neighborhoods in perpetuity. The true power of what this means can be seen in Takesa Village, a community that we helped to finance so they could become stewards of their land.
ROC USA has championed the dignity inherent in all forms of housing, particularly manufactured housing, and build the power of manufactured home communities to control their own destinies
ROC USA, a longtime partner of Capital Impact Partners, helps residents of manufactured home communities, like Takesa Village, to purchase their community and operate it cooperatively, which has preserved affordable housing options across the country.
Evolution Toward Holistic, Place-Based Investment
Over the years, not only has our scope of work developed — but so did our footprint. We saw an opportunity to support Detroit communities in a holistic manner that would advance economic prosperity and social justice for longtime residents, an opportunity that led to a concerted place-based strategy.
In the early 2000s, when the Great Recession sent the Motor City reeling, we were asked by the Kresge Foundation to be part of the Living Cities Integration Initiative. This effort was designed to support the city’s revival by joining with other organizations to invest in a “place-based” strategy designed to foster holistic ecosystem change.
It proved to be a seminal moment for our organization. This strategy allowed us to draw and define on a map the different parts of the city where we knew our work would be most effective. It taught us the importance of what it meant to stand shoulder-to-shoulder with a community, understand the barriers it faced, and work with community members to implement their solutions.
This type of engagement at the local level provided a real understanding of what was going on in the neighborhoods that we serve.
Some great examples of developments we invested in Detroit and Michigan include The Auburn and Casamira — which brought affordable housing options and mixed-use space to local communities — and Imperial Fresh Market, a grocery store that serves its community in northwest Detroit with fresh, healthy food daily.
Imperial Fresh Market has supported its Detroit community with access to healthy food and quality jobs since the Shina brothers opened more than 20 years ago.
We found this approach so impactful that we applied this place-based strategy to our approach in other parts of the country, including northern and southern California, Michigan and northwest Ohio, Texas, the New York Tri-State area, and the Washington metropolitan area.
Equity is the Beginning of Wealth & Health
Our work on the ground in Detroit also revealed another opportunity we had overlooked. While we were making good strides in our lending, we were missing entire swaths of the population who simply never had the opportunity to launch the kinds of projects we supported.
Opportunity has been historically driven by access to quality education to build quality jobs that build generational wealth. For residents of underestimated communities, access to the financing, training/education, and networks that would help them open businesses or engage in real estate development to build local wealth and health have been systematically denied.
That realization led to the creation of our EDI program – a program that provides training, mentorship, and access to capital for developers of color – which has since expanded beyond Detroit to the Washington metropolitan area; the San Francisco Bay Area; and Dallas, TX, and has served more than 200 developers.
Through our EDI program, developers across the country get a foothold into the real estate development industry, with training, mentorship, and access to capital.
In leading this investment in developers of color, we listened to their needs around access to capital. Listening to the financing gaps they experienced led to us creating the Diversity in Development Loan Fund in Detroit and the Washington metro area, which will soon be expanded nationally.
Our work in listening to community members to develop products and services to support their needs has not gone unnoticed. Fast Company recently recognized Capital Impact’s work in their 2022 list of the Most Creative People in Business.
It was this understanding of the need to listen to communities and ensure that our strategy addressed systemic issues and barriers that led to another seminal program.
In 2015, we created and have continued to manage our Co-op Innovation Award to amplify innovative co-op business models in communities living with low incomes and/or communities of color. Since that time, we have supported 17 co-ops nationwide and disbursed $685,000 in grants, which helped our awardees leverage more than $9.1 million in additional funding from foundations, investors, and government.
Cooperatives are powerful tools for economic stability and wealth building. Our Co-op Innovation Award has given seed funding to innovative co-ops fostering self-determination nationwide.
Cooperatives have so much power to create economic stability and self-determination for residents of underestimated communities, and the power becomes greater when it can be scaled. Another conversation that we have been taking part in is around the potential of employee co-op conversions to foster a deeper level of economic mobility and stability. These conversions happen when a business owner sells the business directly to their employees, rather than into the market. With Baby Boomers retiring, many healthy businesses have no one to inherit the business and no buyers; as a result, these businesses are closing in record numbers, and that trend was only exacerbated by the COVID-19 pandemic.
In 2018, we published “Co-op Conversions At Scale,” a market research report to assess the growth potential of employee ownership (worker co-op) conversions in several markets, and convened CDFIs, small banks, and credit unions to learn about opportunities for scaling and financing co-op conversions.
In 2021, we turned that research into action and financed the employee ownership conversion of Ward Lumber, a 130-year-old business in New York, allowing more than 40 employees to become worker-owners.
What we learned is that true transformation comes from deep investments in local ecosystems to change the systemic and historical issues that have kept communities from building generational wealth that would help them thrive.
New Horizons for Addressing Systemic Disinvestment
Today, we continue the throughline of our work, which centers on building prosperous communities through economic, social, and racial justice. We are challenging ourselves to think bigger and more creatively about how to work hand-in-hand with community members to foster equitable and inclusive opportunities for wealth building.
In July of 2021, Capital Impact Partners, CDC Small Business Finance, and Ventures Lending Technologies came together to create the Momentus Capital family of organizations. This milestone was achieved through two years of work to come together as a new enterprise.
Momentus Capital is a first-of-its-kind financial organization that brings together leading companies rooted in social mission. Momentus Capital offers a continuum of financial, knowledge, and social capital to help local leaders build inclusive and equitable communities and create generational wealth. Together, we are now able to leverage our 80+ years of experience to offer our borrowers and partners an even more comprehensive set of solutions – including lending and impact investments, training and access to networks, and innovative technology – while also being more innovative and nimble than we could when operating separately.
Most recently, we began looking at the opportunity to offer more than just loans and grants, but also actual equity investments in companies run by diverse entrepreneurs and/or serving communities of color. Much like in other areas we focus on, Black communities are drastically underserved by the venture capital community. We decided this was another place we could make a difference by offering. To address this issue, we launched our impact investments program, which combines venture debt, revenue/profit-sharing agreements, and preferred equity investments to aid growth-stage businesses led by diverse entrepreneurs and employee-owners.
While we invest in a broad range of companies, it is critical that cooperatives be represented.
One of our very first investments was in Obran Health, a unique company that operates worker-owned healthcare companies. When Obran Health sought to acquire Physicians Choice Home Health, a home health care provider in Los Angeles, we provided a $1 million preferred equity investment. This allowed Obran to avoid the traditional route of syndicated loans and debt which would have hampered their long-term growth.
Innovating Systems for Thriving Communities
The opportunity for community impact is immense. Healthy communities are built by their residents. Small business owners, developers, and other local leaders are the engines of job creation and economic activity in communities across the country. When these leaders have the opportunity to succeed, their communities, local residents, and our country – thrive.
And while we are looking forward to catalyzing profound community transformation through Momentus Capital, we recognize that we are here because of the 40 years of expertise we have built with our colleagues and partners. We will always remember our roots in the cooperative movement and will continue investments to expand that community. From loans and grants to seminal research and equity investments, our work through Momentus Capital opens up a whole new area where we can uplift co-ops and support their work.
I am so proud of where Capital Impact Partners has come in the course of the last 40 years, and I cannot wait to see how Momentus Capital will innovate holistic approaches to get resources into the hands of more local leaders, entrepreneurs, and their communities.
As we continue to celebrate this milestone year, watch our 40th anniversary video series. The series includes rich reflections from the very people who have helped make us who we are, like Terry Simonette, my predecessor and Capital Impact’s longest-serving CEO; Paul Bradley, president of ROC USA; alumni of our Equitable Development Initiative; and so many more.
Watch our 40th anniversary video series!
I invite you to subscribe to our YouTube channel to hear these stories and experiences first-hand. We’ll continue to reflect on, recognize, and celebrate our 40 years in the months to come. I look forward to our continued work together to foster communities of opportunity because we are stronger together, and together, we are creating new pathways to build inclusive and equitable communities by providing people access to the capital and opportunities they deserve.
While the essence of our mission has remained the same over the years, it’s the people – staff past and present, our partners, the communities we’ve had the privilege of working in, and the countless other stakeholders — who are responsible for our journey and our evolution. It’s you who I find the most inspirational. You are the ones who have helped Capital Impact Partners become who we are today — a national Community Development Finance Institution (CDFI) committed to building a nation of communities built on a foundation of equity, inclusiveness, and cooperation.
I’m proud to celebrate and share this milestone with all of you.
By Mary Donnell, Program Manager, Michigan Good Food Fund
The grocery business is more competitive than ever. Even in normal times, much of the market share is taken up by the big-box players. But in the face of an unprecedented pandemic, local, independent grocers are focusing more deliberately on serving their communities, going out of their way to provide the goods that customers that they often know by name need. These grocers continue to fill an important niche in the landscape, often serving communities that do not see much investment from national chains with top-notch customer service and a focus on community development and local food.
Each year at Capital Impact Partners, we host an offsite, where all staff comes together to discuss successes and challenges in our work, and strategizes how we can continue to commit to the communities that we serve for greater social impact. This year, we held our offsite in our backyard: Washington, D.C. Being a mission-driven organization, we also sought to live out our values and be “of” our Washington, D.C. communities by getting out from behind our desks and serving those who need the most support.
Community engagement is a critical component to our work at Capital Impact, particularly as supporters of innovative community-based work. As a Community Development Financial Institution (CDFI), we support community-driven solutions that address the economic, social and racial justice barriers to success in our most underserved communities. Having first-hand knowledge of our communities and their needs helps us ensure that the projects we support have the outcomes our clients need.
With our home base in the Washington D.C. area, we strive to be present and engaged in the city’s communities. We work with organizations across the city to address various issues of structural exclusion and poverty. One of the areas that Capital Impact focuses on in this effort is healthy food access. Our strategic focus on health care and healthy food ties directly into our call to help communities achieve their full potential. We all need access to healthy food to thrive.
California may be an agricultural center of the nation, but more than one million Californians live in neighborhoods without easy access to a full service grocery store. This lack of access to fresh foods can lead to poor health outcomes and diet-related diseases, including diabetes, heart disease, and obesity. Communities of color are disproportionately affected. Capital Impact Partners has worked for years to address this issue, and to help more communities get access to grocery stores or mobile markets.
Picture it: the freezer breaks and you’re scrambling to save all your frozen food. In a home, a big cooler or the generosity of a neighbor may solve your problem – but for a grocery store, the goods in a broken freezer cannot be housed at a neighbor’s house until the freezer is fixed.
The freezer, top of the line when it was purchased in the 1970s, was just one challenge faced by First Alternative Cooperative, a community co-op market in Corvallis, Oregon. Along with replacing equipment, including its critical point-of-sale system, which was past its prime, the grocery store needed to make some building improvements and consolidate debt to improve its cash flow.
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California may be an agricultural center of the nation, but more than one million Californians live in neighborhoods without easy access to a full service grocery store. This lack of access to fresh foods can lead to poor health outcomes and diet-related diseases, including diabetes, heart disease, and obesity. Communities of color are disproportionately affected. Capital Impact Partners has worked for years to 
