Health care and hospital systems are looking at a new way to align their dollars with their missions by pursuing affordable housing investments. Early movers in the space hope that those impact investments will both increase community health and decrease the financial strain on their institutions.

“Asset managers tell us for impact investing across investor types, … there’s just been an increase in interest in housing,” says Laura Levesque, associate director of Cerulli Associates’ institutional group. But for health care providers, those investments can be especially appealing: “A lot of the research shows that homelessness causes a lot of the poor health outcomes that cost the health and hospital systems a lot of money in emergency care and … hospitalization,” Levesque adds.

That argument is attracting some health care system investors. In the last few years, several well-known leaders have started to allocate money for affordable housing investments, Cerulli noted in a recent report. Kaiser Permanente, for instance, announced in 2018 that it was setting aside $200 million to address housing issues. Other hospitals and health care systems, including Trinity Health, Boston Medical Center and CommonSpirit Health have made similar allocations, albeit often on a smaller scale.