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Why We Incorporate Walk and Bike Scores into our Impact Themes

If you’ve gone through the home buying or renting process during the past few years, you may have seen something called a Walk Score while exploring properties online.  This metric, which is patented by a company with the same name, has become a popular addition to online real estate sites such as Zillow or Redfin and provides an instant idea of how easy, or difficult, it is to navigate an area on foot and whether there are stores, schools and employers nearby.

City-Bikes

Bike Scores work similarly, measuring bike accessibility based on bike infrastructure, topography, destinations and road connectivity1

Especially in urban areas, a high Walk or Bike Score can provide rough answers to many common questions of city dwellers:

  • Do I need to own a car? (Looking at you, Millennials!)
  • Can I potentially walk to school and/or place of employment?
  • Are there grocery stores, shops, entertainment, and restaurants within walking distance?

While these tend to be questions of convenience, there are aspects of walkability/bikeability that have meaningful environmental and social impacts. As provided by Walk Score2, these include:

  • Health: The average resident of a walkable neighborhood weighs 6-10 pounds less than someone who lives in a sprawling neighborhood3. Cities with good public transit and access to amenities promote happiness4.
  • Environment: 87% of CO2 emissions are from burning fossil fuels5.
  • Communities: Walkability is associated with higher levels of arts organizations, creativity, and civic engagement6.
  • Finances: Cars are the second largest household expense in the U.S.7. Thus, there is quantifiable value in not needing one. One point of Walk Score is worth up to $3,250 of value for your property.8  This is even more important in low-income neighborhoods.

At CCM, our mission is to deliver superior risk-adjusted returns through investment strategies that contribute to positive environmental and social outcomes, so incorporating Walk and Bike Scores into our investment themes makes sense. For example, our Single Family Agency Mortgage-Backed Securities (MBS) with high Walk scores contribute to both our Healthy Communities and Environmental Sustainability themes since it promotes health and wellness while encouraging a zero-emissions form of transportation.

These are just two of our 18 thematic impact initiatives which positively affect people and our environment in myriad ways - a testament to the benefits gained from our commitment to impact investing. As we continue to think about the areas of overlap between client values, quality investments, and reportable impacts, we are always working to redefine and expand the frontiers of our field. Leveraging data such as Walk and Bike Scores is one such way we have evolved our methodology to heighten potential environmental and social outcomes while also benefitting our clients.

 

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1Report on US Sustainable, Responsible and Impact Investing Trends 2016

2https://www.morganstanley.com/pub/content/dam/msdotcom/ideas/sustainable-signals/pdf/Sustainable_Signals_Whitepaper.pdf

3Report on US Sustainable, Responsible and Impact Investing Trends 2016

4https://www.barrons.com/articles/esg-charges-into-the-mainstream-1518462617

5https://www.marketwatch.com/story/sustainable-funds-outperformed-the-broad-market-in-the-recent-correction-2018-02-15

6https://www.unpri.org/download?ac=4218

7http://www.oceantomo.com/2015/03/04/2015-intangible-asset-market-value-study/

8Report on US Sustainable, Responsible and Impact Investing Trends 2016

9http://www.pionline.com/article/20171214/ONLINE/171219862/callan-more-us-asset-owners-incorporating-esg-factors-into-investment-decisions

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 A full list of regulatory disclosures for Community Capital Management, Inc. are available by visiting: https://www.ccminvests.com/regulatory-disclosures/.