Greetings, Agents of Impact!
Welcome to this week’s ImpactAlpha LP/GP, where we take you inside the real business of impact investing and the dynamic relationships between owners, managers and intermediaries of impact capital.
In this week’s newsletter:
- New York City’s pension chief on negotiating lower fees
- Jonathan Rose Cos. raises $660 million for green affordable housing
- LP Scan: Nature-based solutions
- McKnight’s Tonya Allen goes all in on mission
Featured: Institutional LPs
How New York City’s pension funds are recycling capital and pushing PE firms to lower fees. When it comes to snagging deals in private equity, the early bird – and the big bird – gets the worm. “We typically get what’s referred to as big bird and early bird discounts – big bird meaning size discounts, and early bird discounts by being in the first close of these deals,” says Steven Meier, who, as the New York City Retirement System’s chief investment officer, oversees investments for the city’s five public pension funds. The $288 billion pension fund system is getting lots of worms lately. After selling some $5 billion in aging private equity assets to Blackstone in one of the largest secondary transactions to date, the city’s pension system is leaning into private equity as others are leaning out. The secondary sale, clinched in March, culled 75 private equity managers and more than 125 distinct funds, enabling the five retirement funds to focus on a core set of 40 to 45 managers, including KKR, Apollo, Vista Equity Partners, Ares, EQT and TPG Rise Climate. Sales of secondary stakes hit a record $160 billion last year. Transaction volume in 2025 is on track to surpass that.
- No-fee, no-carry.The difficult fundraising environment for private equity managers has translated into more clout for large and willing LPs like New York City. That includes negotiating “much better economics” on the share of profits a fund’s general managers take, and securing co-investment privileges that eliminate management fees and carry altogether (see, “That (mixed) feeling when your LP co-invests in the sweet deal you’ve just negotiated”). Meier’s team typically tries to negotiate about a third of its total investment in a given fund as co-investment. Such “no-fee, no-carry private equity,” he says, “will really have a positive impact on the portfolio returns.” For the remaining two-thirds of investments, the early and big bird discounts trim costs further, says Meier, who has been critical of excessive fund fees and the outsized wealth they generate for asset managers.
- Diverse and emerging managers. Like some other big pension funds and long-term investors, the New York City Retirement System is holding firm on climate, diversity and other politically charged investment themes. “Everything we do continues to be looked at through an ESG lens, as opposed to buying an investment that’s labeled ESG,” says Meier. In February, the Comptroller’s office hired Valerie Red-Horse Mohl, former president of Known Ventures, to spearhead its diverse and emerging manager program and “economically targeted” investments in affordable housing, health and other areas (see, “Moving capital at scale to elevate communities of color“). “Smaller managers can find niches where they can outperform the bigger managers,” says Meier, who declined to identify the funds that were part of the secondary sale. A scan of the system’s public data shows several emerging manager funds in the portfolio before the secondary sale were no longer listed in April. They include funds from Siris Partners, Palladium Equity Partners, GCM, and Fairview. Funds from BC Partners and Carlyle, Blackstone and Ron Burkle’s Yucaipa also appear to have been divested.
- Keep reading, “How New York City’s pension funds are recycling capital and pushing PE firms to lower fees,” by Amy Cortese.
LP Scan: Nature-Based Finance
More than two dozen LPs investing in nature-based funds around the globe. Nature-based solutions, once dominated by donors and NGOs, are beginning to attract new types of capital. Microsoft’s Climate Innovation Fund and California pension fund CalSTRS, for example, are anchor LPs in Just Climate’s $175 million Natural Climate Solutions strategy. The fund is investing in reforestation and ecosystem restoration projects, with commercial and climate upside. ImpactAlpha has tracked more than 30 limited partners that have invested in the past year in funds supporting regenerative agriculture, reforestation, carbon sequestration, ocean restoration and other nature-based strategies.
- Corporate interest. Private finance for nature has increased from just $9.4 billion in 2020 to more than $100 billion in 2024. Corporations have been key to that growth. Milkywire’s Climate Transformation Fund, which recently backed Nigerian biocard producer Releaf Earth, has received corporate funding from Klarna, Salesforce and Spotify. Two vehicles from Climate Asset Management – the Nature-Based Carbon Fund and the Natural Capital Fund – include GSK, Tokyo Gas and Carrier among their LPs.
- Catalytic capital. It’s mostly development finance institutions and philanthropic investors providing early support for nature-based investment funds in emerging markets. Acumen’s Resilient Agriculture Fund, for example, was seeded by a $25 million first-loss commitment from the Green Climate Fund. Green Climate Fund also anchored the Pegasus Capital Advisors’ Global Fund for Coral Reefs – one of the few commercial-scale funds focused on ocean ecosystems.
- Keep reading.
Dealflow: Affordable Housing
Jonathan Rose Companies closes $660 million fund for green affordable housing. For its sixth housing preservation fund, Jonathan Rose Companies attracted pension funds, endowments, family offices, banks and foundations, including Capital One and the Ford Foundation. Three quarters of the capital commitments were from return investors in the fund series, which has raised over $1.5 billion. “They were all very serious about their analysis of our impact,” founder Jonathan Rose told ImpactAlpha. “The investors who really want additionality and impact are there.” The new fund will acquire and preserve affordable and mixed-income multifamily housing in New York, Boston, Chicago, San Francisco, Washington, DC, and other cities where the cost of rental housing continues to surge. Nearly half of renters in the US are cost burdened. “With America’s affordable housing crisis deepening, our investment in fund six couldn’t be more timely and critical,” said Ford Foundation’s Roy Swan.
- Policy headwinds. The Trump administration’s cuts to green building and social safety-net programs have caused some developers to scale back their impact efforts. The Rose Cos., through Power Forward Communities and Climate United, had been vying for capital earmarked for green buildings in the Greenhouse Gas Reduction Fund. “All the awards that we won have been rescinded,” Rose said. “Without that kind of support, it does not make economic sense for us to take existing buildings and to make them fossil fuel free.” Despite the setbacks, the Rose Cos. remains bullish on greener buildings. “We’ve always been serious about our impact intentions from the beginning, but we’re getting better and better at our executions and the reporting of our executions,” Rose said (listen to the podcast, “Jonathan Rose on building green, affordable communities of opportunity”).
- Keep reading.
500 Global commits $300 million for emerging market startups tackling urgent challenges. Palo Alto, Calif.-based venture firm 500 Global (formerly 500 Startups) is co-investing with sovereign wealth funds, development financial institutions, governments, foundations and other private investors out of its Abu Dhabi office. The location is strategic as 500 Global hopes to draw institutional capital from the Middle East for investments in Africa, Latin America and Southeast Asia. The firm will focus on climate adaptation, food systems, AI, gender equity, biodiversity and other sectors. “These are the challenges that will define the next decade, and the greatest opportunities to create more resilient and equitable futures for people and communities everywhere,” wrote Alaa Murabit, the former Gates Foundation executive brought on by 500 Global to lead the strategy.
- More.
Dealflow overflow. Investment news crossing our desks:
- The Emerging Africa & Asia Infrastructure Fund committed $40 million to AXIAN Telecom’s $600 million bond, which will finance digital infrastructure and connectivity in Africa and Asia. (Africa Private Equity News)
- Auxxo reached a €26 million ($30.4 million) first close for its second Female Catalyst Fund, which backs early-stage, women-led startups in Europe. The fund was anchored by the European Investment Fund. Over half of its LPs are women. (Auxxo)
- Energy forecasting startup Amperon raised funding from Japan’s Acario, the venture arm of Tokyo Gas. (Amperon)
- Activate Capital invested in Montreal-based XNRGY, which makes sustainable cooling systems for data centers and commercial buildings. (XNRGY)
Signals: LP = Leadership Potential
McKnight Foundation’s Tonya Allen on going ‘all in on mission.’ Tonya Allen has some simple advice for her more risk-averse foundation peers: If your lawyer is telling you to pull back, get a new lawyer. In the current political environment, Allen is pushing Minneapolis-based McKnight Foundation to invest more, not less, in strategies to advance racial equity and climate action. “When you’re in a crisis, that’s a time when you should be bolder,” Allen tells ImpactAlpha. McKnight has increased its mandate for program-related investments, or PRIs, to $100 million. Last year, McKnight granted $145 million – its most ever – to more than 700 organizations. The 7% payout rate was above the legal minimum of about 5%. The foundation is more than halfway to its goal of investing its $2.6 billion endowment in line with its philanthropic mission.
- Capital commitments. McKnight recently began releasing capital to local lenders that are part of the Groundbreak Coalition, which has raised $1 billion to expand access to capital for commercial real estate, business ownership and homeownership in historically underinvested neighborhoods in the Twin Cities. The initiative’s local community development financial institutions and other lending partners aim to deploy $100 million over three years. The foundation recently backed Brick by Brick, which is returning about 400 single-family homes in the Twin Cities to local ownership after being acquired by a private equity firm in the aftermath of the 2008 financial crisis. Another PRI portfolio company, Cooperative Energy Futures, is a community solar developer that is helping transition solar assets to cooperative ownership.
- Collective action. Allen, who has led McKnight since 2021, says she is being outspoken about McKnight’s investments in racial equity and climate action precisely because so many others are keeping quiet. “There was so much fear in the atmosphere about whether you could be your authentic self with the kind of pushback that was happening at the federal level by the government,” Allen says. The foundation released its manifesto, “All In On Mission,” to buck up other foundations. Allen and MacArthur Foundation’s John Palfrey helped rally more than 700 organizations to sign a public statement. “I believe we have the freedom to give, to invest, and we should have the freedom to be able to speak on the things that we value,” she says. “If that requires group or collective action to help other people feel comfortable in that space, then we want to create that for them.”
- Keep reading, “McKnight Foundation’s Tonya Allen on going ‘all in on mission,’” by David Bank on ImpactAlpha.
Agents of Impact: Follow the Talent
Norbert Cichon, previously with Good Chaos, joins Spring Point Partners as an investment team director… UBS promoted Amantia Muhedini to head of sustainable and impact investing in the Americas… Eva Neubauer Alligood, formerly with LISC, joins Neighborhood Restore Housing Development Fund as chief program officer… Yesenia Gallardo Avila, previously with Potencia Ventures, joins LEMNIS as managing director.
Iueh Soh, previously with Obran Cooperative, joins Kaiser Permanente as senior director of enterprise strategy and business development… Justine Janssen becomes interim executive director of Employee Ownership Canada… Inclusive Prosperity Capital adds Victoria Giasullo as marketing and engagement associate… Avivar Capital seeks a monitoring vice president… Triodos Bank is looking for a policy specialist.
The Terner Center for Housing Innovation is recruiting a deputy director of policy… Energy Impact Partners is on the hunt for a strategic partnerships associate in New York… Social Finance seeks an associate for workforce and education investments in Boston… Temasek has an opening for an ESG investment management associate or vice president… Carbon Equity is hiring a CRM marketer in Amsterdam.
👉 View (or post) impact investing jobs on ImpactAlpha’s Career Hub.
Thank you for your impact!
– July 22, 2025
