On the corner of Portage Street and Lake Street in the Edison neighborhood of Kalamazoo, workers are putting the finishing touches on an attractive new multi-use building known as the Creamery. The building, which was partially funded with an innovative Impact Investment Loan program from the Kalamazoo Community Foundation (KZCF), will soon house affordable apartments for low- and middle-income people, a YWCA 24-hour childcare center and a small business accelerator.
“It’s exciting to see the Creamery project coming to life as we relaunch our Impact Investment Loan program,” said Martha Gonzalez-Cortes, vice president of Community Investment for KZCF. “We are hoping to see proposals for additional creative initiatives aimed at removing barriers for Kalamazoo County community members.”
Those from the area will recognize the name of the Creamery building as a reference to the lot’s former occupant, Klovergold Creamery, which once produced dairy products such as milk in glass bottles, cottage cheese and ice cream mix. Prior to the Creamery, the site housed Union Brewing Company, a pre-Prohibition brewery that foretold Kalamazoo’s now-famous beer culture. Like its predecessors, the new Creamery building is set to play a key economic role for the Edison neighborhood — making it an excellent candidate for KZCF’s Impact Investment Loan program.
Lifting up visionary ideas
Unlike traditional investing, impact investing seeks to support companies, organizations and funds that have measurable social impacts. Financial returns gained from loan interest can then be re-invested into the community, with the success of each initiative helping to fund the next.
Partners who finance with an Impact Investment Loan from KZCF also benefit from the advantages of using a non-traditional lending source. With interest rates based on the Consumer Price Index + 1 percent and flexible loan terms, businesses and organizations can secure funding that may not otherwise be accessible.
In line with KZCF’s strengthened focus on racial equity in Kalamazoo, their investment priorities currently include increasing access to housing, supporting and expanding wealth-building in Black, Indigenous and People of Color (BIPOC) communities and developing nonprofit infrastructure. The housing accessibility component is especially relevant when it comes to the Creamery building.
“Achieving housing security for all community members is an undertaking that deserves creative and impactful solutions,” Gonzalez-Cortes said. “Through the Impact Investment Loan program, we hope to fund organizations and entrepreneurs who are expanding access to housing in Kalamazoo, as well as those who may be experiencing a gap in funding to bring a project to fruition.”
Breaking down barriers
One of the aspects of the Creamery that appealed to KZCF’s Impact Investment Committee was the multipurpose nature of the 60,000 square foot building. In addition to allowing more access to much-needed affordable housing, the Creamery’s inclusion of the city’s first 24-hour childcare center is significant.
Area parents who have faced long waiting lists and financial barriers to finding affordable childcare have often been forced to choose between going to work or caring for their children. The Center for American Progress found that a lack of childcare disproportionately affects women. More specifically “they would increase their earnings and seek new job opportunities if they had greater access to reliable and affordable childcare.” Having a childcare option with flexible scheduling expands possibilities for parents who are shift workers.
The onsite small business accelerator also furthers the Impact Investment Committee’s goal of supporting opportunities for expanding wealth in BIPOC communities. The Edison neighborhood is Kalamazoo’s largest in terms of population, with US Census data showing 35 percent of community members identifying as African American and 17 percent identifying as Latinx. The small business incubator will provide entrepreneurs in the area with a place to develop their business ideas and feed into the growth of the local economy.
Seeking new avenues to equity
By funding projects such as the Creamery, KZCF can advance racial equity and connect community members with the resources they need to reach their full potential. The Community Foundation’s Impact Investment Committee will review applications four times a year using a Racial Equity Impact Assessment Guide to ensure alignment with investment priorities. Applications will be accepted on a rolling basis.