National Day of Racial Healing, #HowWeHeal

Racial Healing: The Path to Racial Equity Starts Here

Since the racial reckoning of 2020, the term racial equity has been used consistently to talk about the goal of organizations like ours. Racial equity works to address hundreds of years of injustice perpetuated on the basis of race in this country: from the Indian Removal Act to chattel slavery and Jim Crow to the Chinese Exclusion Act and Japanese internment, and so many other examples of discrimination and oppression. In this light, the need for racial equity is clear, but what about racial healing?

Read about how we, at the Momentus Capital branded family of organizations, are working alongside our communities and partners to start the healing that is needed to build equitable, inclusive communities. 

Independent Drivers Guild members pose together as a group in front of their signage.

Our Impact in 2023

As we begin 2024, we at the Momentus Capital branded family of organizations want to thank all of you – whether you are a borrower, a partner, an investor, or a member of the Momentus community –  for being part of our work to reimagine and build an economic system that includes everyone.

Read what our President and CEO, Ellis Carr, has to say about the impact you helped us create in 2023 and about the outlook for the year to come on the Momentus Capital blog

A mother poses with her two sons in a school library.

Momentus Capital’s Approach to Social Impact Measurement

Across the Momentus Capital branded family of organizations, we know that to maximize our impact, we need to first understand it. Building and sustaining healthy, inclusive, and equitable communities requires capital and resources – but without measuring outcomes, it’s impossible to develop effective interventions at scale.

That’s why we’ve developed a comprehensive Impact Framework to help us track the results of not only our loan offerings but also the capacity-building programs, technical assistance, and tools that make up our continuum of capital (PDF).

This framework is at the center of our decision-making process as we work toward our mission of helping to build inclusive and equitable communities by providing people access to the capital and opportunities they deserve.

So, what are we measuring, and why?

To learn more about what we are measuring and why, read the full article on Momentus Capital’s blog.

A family poses in front of a produce section at the supermarket.

How Momentus Capital Supports Economic Stability

Across the Momentus Capital branded family of organizations, our mission is to ensure people and communities have the capital and opportunities they deserve to overcome a history of systemic disinvestment.

To support underestimated communities in achieving positive social and economic outcomes, we need a shared understanding of what that looks like, and why those outcomes are so important. This blog will outline how we at Momentus Capital define economic stability and why it is important, how it is tied to the other social determinants of health, and how we are working to promote economic stability through our work.

Read the full article on Momentus Capital’s blog.

Group photo of the Momentus Capital lending operations team.

Driving Change with a Human Approach to Lending Operations

By Alexander McDonald, Senior Director of Lending Operations

For communities to thrive, they need resources — but too often, small business owners, developers, and local community development leaders lack access to the capital they need to drive progress.

Across the Momentus Capital branded family of organizations we are on a mission to change that through a community-first approach to lending grounded in our commitment to diversity, equity, and inclusion. And for us, that includes much more than the actual continuum of capital we deliver, but also HOW engage with our borrowers and partners to do that. Every aspect of our lending operations is built on our values, which means taking out a loan from Momentus is a much different experience than borrowing from a traditional financial institution. 

But our approach doesn’t just feel good. It also leads to exceptional outcomes. The secret to our success? Putting the borrower first with superior client service, competitive products, and scaffolded support.

And our lending operations team is at the heart of what makes Momentus unique. 

To learn more about how our lending operations team works with borrowers and supports social impact, please read our full blog on the Momentus Capital website.

Exterior of Supreme Court showing inscription saying: "Equal Justice Under Law"

Momentus Capital President & CEO Ellis Carr Reflects on Supreme Court Rulings

 

Exterior of Supreme Court showing inscription saying: "Equal Justice Under Law"

By Ellis Carr, President and CEO

At Momentus Capital, we envision a future where everyone has the capital and opportunities they deserve – especially those who have been excluded from both for so long. 

Our President and CEO Ellis Carr reflected on the contrast between Independence Day celebrations and a set of Supreme Court decisions that challenged promises about democracy, opportunity, and the pursuit of happiness. 

His reflections tackle a few areas:

  • How promises about democracy, opportunity, and the pursuit of happiness have been shaken;
  • How these decisions will have negative consequences on fellow citizens who have faced long decades of discrimination; and
  • Momentus’ commitment to continue to speak and work in support of underestimated communities. 

Read Ellis’ reflections on the Momentus Capital website.

Graphic with a yellow background, computer, cell phone, and other office accessories with 2023 goals ahead.

Predictions 2023: What to Expect for Capital Deployment, Small Businesses, and Mission-Based Lending

Graphic with a yellow background, computer, cell phone, and other office accessories with 2023 goals ahead.

As the first quarter of 2023 unfolds, Momentus Capital team members are starting to see trends for an exciting year ahead. And while 2022 proved to be another rollercoaster ride for the economy and small businesses, our experts still forecast plenty of opportunities to make 2023 a groundbreaking year in mission-based lending.

In this year’s predictions, we take a deep dive into a wide range of topics, including how communities can lead the way to greater economic prosperity, how we can get more capital into the hands of small businesses, and potential legislative changes on the horizon. Ultimately, we remain focused on how these factors could impact our borrowers, partners, investors, and the communities we serve. This valuable foresight serves as a compass for existing entrepreneurs and those embarking on their ventures.

Please read the rest of this blog on the Momentus Capital website.

graphic for black history month

Black History Month: Fostering Thriving Black Communities as Resistance to Inequity

Graphic with the words Black History Month

It’s Black History Month! This month, we will celebrate by illuminating the social and economic experiences that shape the lives of African American communities. We also wanted to take a moment to share the history of Black History Month and the theme for this year.

Did you know that Black History is a tradition that started in the Jim Crow era and was officially recognized in 1976 as part of the nation’s bicentennial celebrations? It aims to honor the contributions that African Americans have made and to acknowledge their sacrifices. Each year, the Association for the Study of African American Life and History (ASALH) chooses a different theme, with this year’s theme focusing on “Black Resistance.”

Please read the rest of this blog on the Momentus Capital website.

Real estate developer in conversation with lender

The Top 10 Questions To Ask Your Community Development Real Estate Lender Before Starting Your Development Project

As a real estate developer looking to deliver social impact, the process of finding and engaging with a lender can be hard. Once your mind is set on starting a community development real estate project, who do you turn to? Where do you find them? What is the process like? 

As part of the Momentus Capital family of mission-driven lenders, Capital Impact Partners – a  certified Community Development Financial Institution (CDFI) – provides flexible and affordable loans of $650,000+ ($350,000 under special circumstances) to finance key community pillars, including health centers, education facilities, food retailers, affordable housing, small businesses, and cooperatives.

We are a national lender, capable of providing loans across the country, but we also have a place-based focus in specific regions, including California, Michigan and northwest Ohio, the New York Tri-State Area, the Southeast, Texas, and the Washington metropolitan area.

We know you have got questions about the community development real estate process. To help get your process started, we offer some answers here about working with a CDFI lender.

 

1. When in the development process should I start working with a CDFI lender?

It is never too early to start gathering information from lenders, but you’d ideally want to get started when you are about six months from starting construction.

By then, you would have a good estimate for the timing of obtaining permits and starting construction. 

CDFIs such as Capital Impact Partners will work hand in hand with real estate developers looking to deliver social impact

2. What types of reserves will a CDFI lender require?

Lenders will have contingencies on your project that may go above and beyond what you have budgeted; usually 7.5-15% of hard costs expenses and 5% of soft cost expenses.

If you are capitalizing interest during construction, which is recommended when there are no operations ongoing during construction, that will need to be included in the overall project budget. 

Once construction is completed, there may be lease up reserves, debt service reserves, and/or facility maintenance reserves. 

3. Where does the capital that CDFIs lend come from?

CDFIs serve as capital aggregators that attract capital from the market, banks, government sources, and foundations. 

4. Will a CDFI lender hold the loans or will they sell them?

CDFIs do both. At Capital Impact, if they are sold, we ensure that there is no impact on the Borrower’s experience or relationship. 

5. What influences CDFI lenders’ rates?

Primarily it is the Treasury rates, unless the CDFI has a sector/geographic fund that is independent of Treasuries. 

6. Who approves the loan and how does the loan committee work?

CDFIs have groups that review deals. Capital Impact has an internal credit committee that reviews deals on a weekly basis.

Some CDFIs or specific loan products require external review and approval. Underwriting packages must be submitted at least a week in advance to receive approval the following week.

The committee cares about the financial strength of the transaction, the deal fitting into our established credit guidelines, and the impact of the transaction on the community.  

7. What are some typical terms for underwriting? 

Capital Impact typically provides 1-10 year loans for $1-10 million that fund construction of facilities. The loan is typically interest only during construction and can amortize longer than the maturity, resulting in a balloon payment at maturity. 

8. Who will be my main contact for loan closing and will it change afterwards?

You may first interact with a business development officer or someone with a similar position, who will be the initial point of contact until a term sheet is signed.

Then you’ll speak with a loan officer who will underwrite your transaction until it is approved.

Once approved, a legal and closing team will drive the process, but the loan officer will remain involved to ensure the loan is closed according to what was agreed to with the borrower and as outlined in their underwriting. 

9. As a non-legal person, how do I review a loan agreement?

Consider seeking legal counsel to review a loan document. But generally, check that the interest rate, fees, and dates match your understanding. Check the reporting and financial covenants to ensure you can meet them. 

10. What should I do if I think I am going to default on my loan?

Tell your lender as quickly as possible. CDFIs are lenders with a mission to provide fair, responsible financing, and they will work closely with you when things are tough. Another very important element to take into consideration when looking to establish a relationship with a community development real estate lender is that lender’s value system. You have the right and responsibility to vet the lender to make sure that their values, goals, and philosophies align with yours. It is a two way street and any conversation about funding should be as much about the entrepreneur evaluating the funder as the funder evaluating the entrepreneur.

Capital Impact Partners 40th Anniversary

Forty Years of Breaking Barriers to Success and Building Communities of Opportunity

By Ellis Carr, President and CEO

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.

(more…)