Everence and Praxis invest in inaugural Real Estate Investment Trust (REIT) green bonds

Impact bonds |

Bond purchases continue to expand investments in climate and community

Everence and Praxis Mutual Funds continue their commitment to high impact investments, this time purchasing a total of $2.75 million in the first ever REIT green bonds.

In May 2014, the Praxis Intermediate Income Fund purchased $1 million in the very first REIT green bond through Regency Centers, a preeminent owner, operator and developer of high-quality grocery-anchored neighborhood shopping centers in the United States. Proceeds of the bond will be used to help fund Regency’s Eligible Green Projects, which include the acquisition, construction, development or redevelopment of LEED certified buildings.

In June 2014, on the heels of the Regency REIT green bond, the Praxis Intermediate Income Fund and Everence Association both invested in a green bond offering from Vornado Realty, one of the largest national owners and managers of commercial real estate. Everence and Praxis committed a total of $1.75 million to the Vornado green bond ($1 million through the Praxis Intermediate Income Fund, and $750,000 through Everence Association Inc.), the proceeds of which will also go toward LEED certified buildings.

LEED, which stands for Leadership in Energy and Environment Design, is a rating system for green buildings. LEED certifications are awarded by the Green Building Council.

“This is an outstanding opportunity to open up the REIT sector for the green bond market,” said Benjamin Bailey, Co-Manager of the Praxis Intermediate Income Fund. “These green bonds benefit communities across America. We’re helping to improve the environment and improve the quality of life for Regency and Vornado tenants and customers.”

“At Everence and Praxis, we are concerned about both the financial and social impacts of our investments,” explained David Gautsche, President of Praxis Mutual Funds. “As we purchase more corporate green bonds, our portfolios are better positioned to make a positive impact on our communities and our world, and still receive yields that benefit our investors.”

Everence and Praxis Mutual Funds have long been leaders in green bond investments. The Praxis Intermediate Income Fund has a history of purchasing bonds that make a social impact. In 2009, the Praxis Intermediate Income Fund became one of the first socially responsible investors to purchase a U.S. dollar denominated World Bank green bond.

High social impact investments now make up more than 14 percent of the Praxis Intermediate Income Fund. Beyond REIT green bonds, market rate investments also include bonds in auto industry asset-backed securities, solar and wind installations, affordable housing, vaccines, medical research and community infrastructure. The Fund’s high social impact investments also include community development investments, benefitting disadvantaged communities nationally and abroad.

Disclosure

Bond funds will tend to experience smaller fluctuations in value than stock funds. However, investors in any bond fund should anticipate fluctuations in price, especially for longer-term issues and in environments of rising interest rates.

The Fund's social policy could cause the Fund to sell or avoid securities that may subsequently perform well, and that the application of social screens may cause the Fund to lag the performance of its index.

As of June 30, 2014, the Praxis Intermediate Income Fund had invested 0.27 percent of its assets in Regency Centers and 0.27 percent of its assets in Vornado Realty. Fund holdings are subject to change. To obtain holdings as of the most previous quarter, visit praxismutualfunds.com.