What Led to the Multifamily Impact Framework™

The story behind the Multifamily Impact Framework™, an operating system for multifamily impact investing.

What Led to the Multifamily Impact Framework™

After more than a year of rigorous collaboration with multifamily industry leaders, trade groups, and ESG experts, the Multifamily Impact Council (MIC) proudly presents the 2023 Multifamily Impact Framework™.  

We designed the Framework to serve as an operating system for impact investing in the United States that is market-driven, evidence-based and aligned with global ESG benchmarking and certification organizations. The Framework establishes a baseline of shared principles, definitions, and reporting metrics to attract more impact-motivated capital and support organizational impact strategies throughout the sector.  

The journey to creating the Framework began with conversations in 2020 with impact-focused owners and investors who recognized the financial and social value of such practices during the pandemic. After months of researching past efforts, we realized that while individual associations were working to address the issue, no broad framework existed to establish impact investing principles across all aspects of the industry. 

After extensive research and industry outreach, the Multifamily Impact Council was established in March 2022. Our organization is inclusive and collaborative with a mission to build and maintain a foundation of impact principles and reporting guidelines upon which the industry can grow.  

We based our approach on four fundamental values: 

Simplicity: The framework and reporting metrics must be easy to understand and incorporate for organizations across the capital stack.  

Transparency: A summary of our framework and a resource library of research and best practices will always be available and transparent to the public. Additionally, we are developing reporting guidelines to encourage transparency and enable impact investors to assess each investment against their impact needs and fiduciary responsibilities.    

Evidence-Based: Each principle was informed by academic research and industry best practices.    

Continuous Improvement: We designed the Framework as a starting point that establishes a minimum threshold for impact investments. We will continue to enhance and improve the Framework on an annual basis as the multifamily impact sector grows and evolves.    

In 2022, we underwent a comprehensive, 18-month process to define the principles upon which we built the Framework. Our approach included conducting in-depth interviews, analyzing research, seeking public input, holding deep-dive meetings, and collaborating with our Advisory Board. 

Those efforts resulted in seven Impact Principles that serve as the backbone for the Multifamily Impact Framework™: 

  1. Affordability is the foundation of impact.  The MIC defines affordability along a spectrum of impact that ranges from the Federal Housing Finance Agency’s (FHFA) definition of affordability up to the point where 100% of the renters in a property are paying no more than 30% of their income for rent. 
  1. Housing Stability is achieved when a person is 1) not behind on rent or financially burdened to make rent payments, 2) has not moved in the past twelve months for financial reasons, and 3) is not forced to rely on housing shelters or doubling up with another household.    
  1. Economic Health and Mobility is defined by a person’s ability to improve their financial condition and living standards and achieve greater economic mobility while living in their rental unit.    
  1. Resident Engagement ensures that the services and programs provided are 1) consistent with resident priorities, goals, and needs, 2) leverage existing community resources, and 3) create more access to on-site property staff that builds trust with residents. 
  1. Health and Wellness addresses how a property is built and maintained. We define this principle as incorporating healthy building design, property management practices and resident services that create living conditions that protect and enhance renters’ physical and mental health.    
  1. Climate and Resiliency covers actions taken to make the property more energy efficient, reduce greenhouse gas (GHG) emissions, increase the use of clean energy, and improve the property’s and its residents’ resiliency to climate risk.   
  1. Diversity, Equity, and Inclusion ensure that organizations are incorporating DEI policies at the organizational and property level that create more diversity, equity, and inclusivity in the workforce, management team, and ownership structure. 

These principles empower multifamily owners, operators, investors, and service providers to make a difference in the lives of renter households across income levels. While each property offers unique opportunities to make an impact, our Framework sets specific, intentional actions that each property and portfolio must meet as the baseline requirement to qualify as a multifamily impact investment.  

Also, to enhance transparency, measure impact, and establish industry benchmarks, the Framework includes twenty specific reporting metrics across the seven principles. These metrics were developed in consultation with MIC members and our advisory board to ensure that they were both meaningful and feasible to collect.  

Achieving our goal to increase the flow of impact-motivated capital at scale requires us to build a Multifamily Impact Framework™ with a pragmatic, evidence-based approach that aligns with global ESG certifications specific to the multifamily industry and establishes consistent reporting metrics to help guide investing, product development, and asset management decisions in the future. 

If you are interested in joining us as we set a new standard for impact investing in the rental housing market, please download and adopt the Multifamily Impact Framework™ for your organization