It’s a rare moment when all the puzzle pieces of sustainability, affordability, and long-term returns snap perfectly into place. Yet Arnold Development Group (ADG) believes it’s possible—because we’ve seen it happen. Our award-winning Second and Delaware development proved that Passive House construction, mixed-income living, and transit-oriented design can create vibrant, low-cost communities that stand the test of time.
Now, we’re ready to scale this model nationwide through a new, nonprofit impact investing platform: The Arnold Impact & Resilience Fund. Here’s a glimpse of what we’re building, why it matters, and how you can be part of a movement that’s changing real estate for good.
Second and Delaware: A Proven Blueprint
At Second and Delaware, we built a Passive House–certified multifamily building expected to last 200 years—an extraordinary claim in modern construction. By using superinsulated walls, high-performance windows, and energy-recovery ventilation, we’ve slashed utility costs and created healthier indoor living for residents. Families at different income levels share the same halls and green spaces, forging a truly mixed-income community that’s walkable, connected, and affordable.
This success is no accident. We designed every aspect to balance economic viability with social responsibility—and in doing so, discovered a replicable blueprint we can now amplify through the Arnold Impact & Resilience Fund.
Introducing the Arnold Impact & Resilience Fund
A Nonprofit Platform for Real Estate Impact
The Arnold Impact & Resilience Fund is structured as a nonprofit impact investing vehicle. Foundations, donor-advised funds (DAFs), and accredited impact investors can choose from multiple tranches that offer different rates of return—each carefully calibrated to balance financial performance with meaningful, measurable outcomes:
Concessionary / Philanthropic Tranche (~2.5%): Prioritizes maximum social and environmental impact.
Mid-Level Tranche (~4.5%): Delivers stable, bond-like returns with continued focus on affordability and carbon reduction.
Market-Rate Tranche (~6.5%): Offers higher yield for investors seeking robust real estate returns aligned with social good.
The Fund’s $1.4 billion in planned investments will replicate Second and Delaware’s successes—building 5,300 Passive House–certified units, half of them reserved for households earning around 30–80% of AMI. These developments will cluster near major transit lines, offering families an average of $400/month in transportation savings, plus lower utility bills thanks to net-zero design.
A Quantifiable Triple Bottom Line
Environmental
30 MW of solar power installed & 1,356 EV Charging Stations
Social
$180 million in cumulative rent reductions
$152 million in total transportation savings
Childcare for 300 children per year in on-site facilities
Financial
Multiple tranches offering 2.5%–6.5% returns, backed by durable, low-operating-cost real estate assets designed for long-term resilience.
Financial + Impact Returns: A Game Changer
The attached table summarizes a typical project’s financial returns alongside the monetized social benefits (rent savings and transportation cost savings).
Pure Financial IRR: Around 4.35% for a standard 40-year amortization at conservative debt levels.
Impact-Adjusted IRR: Once you factor in the dollar value of rent reductions and monthly transit savings, the “total return” to the community—and, by extension, mission-focused investors—can jump to the 10–11% range (or higher in some scenarios).
This calculation effectively treats the social savings as a “grant-equivalent” that investors help unlock—without having to write a separate philanthropic check. Instead of purely donating the capital, they invest in a modest-yield vehicle that delivers both a stable financial return and these powerful social dividends. It’s the middle way between traditional grantmaking and purely profit-driven investing, affirming that impact can and should be counted in an investor’s holistic ROI.
Why Modest Returns Matter (Yes, We’re Looking at You, Thomas Piketty)
Economist Thomas Piketty famously concluded that when the return on capital exceeds the growth of wages and the broader economy, inequality worsens. We want to avoid that dynamic. At ADG, it’s not about demonizing wealth or dismissing profitable ventures—far from it. It’s about ensuring real estate development doesn’t become extractive or drive predatory gentrification that pushes families out.
By design, the Fund seeks healthy but moderate returns—enough to protect principal and reward capital, yet not so high that the project undermines affordability or community equity. It’s a balanced approach that recognizes everyone, from working families to mission-minded investors, can thrive together.
Not Anti-Wealth—Just Pro-Impact
Some might worry this line of thinking sounds too idealistic, even “socialist.” But we’ve found that a wide range of investors—from philanthropic foundations to high-net-worth individuals—share one common value: a desire to leave the world better than they found it. The Arnold Impact & Resilience Fund offers a way to invest with purpose without sacrificing fiscal prudence. By keeping returns within a “sweet spot,” we generate positive leverage for all stakeholders.
Join the Movement
Real estate can be a powerful force for positive, inclusive growth—but only if we shape it with intention. The Arnold Impact & Resilience Fund stands ready to demonstrate that large-scale developments can be profitable and progressive, robust and resilient, aspirational and affordable.
Whether you’re a foundation seeking a mission-aligned investment, a donor-advised fund looking for blended returns, or a private investor seeking stable yield with real, measurable impact, we invite you to explore this third way. Together, let’s replicate the Second and Delaware success story nationwide, building homes and communities that honor our planet and its people, now and for generations to come.
Learn More & Get Involved If you’d like more information on the Arnold Impact & Resilience Fund, our Passive House developments, or ADG’s broader impact philosophy, please email us today at info@arnolddevelopmentgroup.com today. Let’s make sustainable, equitable real estate a hallmark of our time—and a legacy we’re proud to pass down.
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