Unitholder Update – August 2016


Welcome to the latest Unitholder Update. To access the notice you’re interested in, click on the links below:

 


Provider Profile: First United Church Social Housing Society

First United Church Social Housing Society has a history of vision and leadership.


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It was the first organization to recognize that housing was needed outside of Vancouver’s downtown east side. It opened a 70-unit building in 1981, and an 86-unit building the following year. Its tenants are primarily homeless or at risk of homelessness.
The organization recognized the need for housing outside of the downtown east side. Its third building, with 33 units, was created under a provincial housing program. It houses seniors, people with disabilities and families in the Mount Pleasant area.

This housing society continues to show leadership today. It is among the first housing providers in British Columbia to invest money through Encasa Financial – a registered investment fund manager. Encasa offers three mutual funds in which non-profit housing providers and co-ops can invest capital reserves and operating dollars, such as security deposits. Encasa started as the Social Housing Services Corporation in Ontario in 2001 and was reformulated in 2014 through an innovative partnership with the BC Non-Profit Housing Association and three other key housing organizations from across Canada. As of July 4, 2016, 867 housing providers invested more than $506 million in the funds.

First United’s property manager, Franca Sorace, explains that she first learned about Encasa at a conference and thought it was a great concept. She subsequently became the property manager at First United and found that the board was exploring how to best manage its investments.

“I told the board that Encasa offered an excellent program,” she recalls, “especially because we could choose a fund based on our specific circumstances, and we wouldn’t have to worry about having to make new arrangements when an investment matures. The program had quite good returns on average over time.”

First United’s Management & Finance Team decided to move forward after meeting with Dawn Bowles, Encasa’s BC investment liaison, and Ron Braaten, investment advisor with PH&N Investment Services.

Dawn noted that the program offers significant benefits for social housing providers. “It provides a range of investment funds to meet long- and short-term needs, access to professional money management, expert advice, and individuals who know social housing,” she explained.

“Our operating agreements are set to expire in 2017, 2018 and 2023,” said Franca. “It’s important to have our money managed by qualified professionals who work hard to make sure we will earn an excellent return.”

BCNPHA’s partners in Encasa are the Co-op Housing Federation of Canada (CHF Canada), the Co-operative Housing Federation of BC, and the Ontario-based Housing Services Corporation.


 

Investment Basics for Non-Profit and Co-op Housing

Knowing how to make the right investment decisions can be a challenge, even more so if the money being invested is not your own. Housing provider boards often struggle with concepts such as how much to invest, for what time period, and what is an acceptable risk? The answers to these questions are as unique as your individual non-profit or co-op.

The first step in building an investment plan is to identify your organization’s investor profile and its account objectives.

The following is a brief overview:

An investor profile is obtained by identifying the net worth and net income of your non-profit, and in considering the investment knowledge and investment experience of its board. Information about the net worth and net income is easily obtained from a balance sheet, whereas the overall investment knowledge and investment experience is a reflection of the board’s familiarity with investing.

Account objectives are identified by responding to three questions:

1 What is your organization’s risk tolerance? Risk tolerance is defined as your comfort level with fluctuations in the value of your accounts. How much volatility is acceptable?

2 What is the Investment Objective? Investment objectives are defined as growth, balanced or income:

  • A Growth objective means that you are seeking long-term capital appreciation. Current income is less of a priority.
  • An Income objective is predominantly focused on the generation of current income in the form of interest and dividends.
  • Balanced is a blend of growth and income.

3 The third factor is to determine a Time Horizon. This is defined as the period between making the investment and the point at which the money will be needed.

Invest according to when you need the money

Individual investors determine time horizon based on certain anticipated milestones, such as saving for a vacation, setting up a college fund and planning for retirement.

For housing providers, an effective investment plan for replacement reserves is tied to their capital plan. In other words, investment and spending decisions are based on the life-cycle of their buildings.

It’s also possible that your non-profit may have more than one set of objectives. For example, the time horizon and risk tolerance for investing replacement reserves could be different than that associated with last-month rent deposits.

Tools and support to help you

Encasa’s Social Housing Investment Program is specifically for housing providers. Working with investment advisors at PH&N Investment Services, we‘ve developed a range of sector-focused tools to support you in making your investment decisions. Please contact 1.888.791.6671 ext. 237 or email information@encasa.ca to request them.


 

Economic Outlook and Fund Commentary – Q2 2016

The Economic Outlook and Fund Commentary offers timely and relevant commentary on your investments in the Social Housing Investment Program. This report provides an up-to-date global economic outlook and quarterly commentary on the performance of each of the Social Housing Investment Funds.

Economic Outlook and Fund Commentary – Q2 2016


 

Download the Latest Regulatory Documents

The 2016 Fund Facts, Simplified Prospectus, Annual Information Form and the Annual Report on Proxy Voting, as well as the Interim Fund Financial Statements and Management Report of Fund Performance are now available on the Encasa website: Encasa Regulatory Documents

 


 

 

DISCLAIMER: All opinions and forward-looking statements contained in this document constitute our judgment as of January 8, 2016, are subject to change without notice and are provided in good faith but without legal responsibility. Forward-looking statements involve inherent risk and uncertainties, so it is possible that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution you not to place undue reliance on these statements as a number of important factors could cause actual events or results to differ materially from those expressed or implied in any forward-looking statement. To the full extent permitted by law, neither RBC Global Asset Management Inc. nor any of its affiliates nor any other person accept any liability whatsoever for any direct or consequential loss arising from any use of the information contained herein.

Please consult your advisor and read the prospectus or Fund Facts document before investing. There may be commissions, trailing commissions, management fees and expenses associated with mutual fund investments. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. RBC Funds are offered by RBC Global Asset Management Inc. and distributed through authorized dealers.