With $1.4 billion in assets under management and a diverse portfolio that includes real estate, renewable energy and urban infrastructure, Forum Equity Partners is one of Canada’s leading private equity firms focused on sustainable real assets.
In some ways, Forum’s approach looks like that of a traditional private equity firm. Be agile. Be opportunistic. Focus on opportunities that offer aggressive growth and the impressive returns that have consistently put the firm in the top 5% of alternative asset investors in Canada.
But unlike most of its mainstream peers, Forum has taken the responsible step of integrating purpose into investment decisions across its portfolio. They support socially responsible projects that satisfy do-no harm criteria and actively pursue investments that generate measurable impact, leading to exciting partnership opportunities with Vancity Community Investment Bank (VCIB).
“We’ve always had an appetite for innovation, and we think some of the most exciting opportunities for innovation are with companies and projects that are solving social and environmental problems,” said Duncan Ramage, a Partner at Forum Equity Partners. “That’s where we focus our human and financial capital.”
Partnerships for ‘extraordinary outcomes’
While a desire to do right by their stakeholders has been part of Forum’s DNA from the start, in 2015 the team formally articulated its mission, vision and values around creating ‘extraordinary outcomes’ for all stakeholders including employees, suppliers, communities, shareholders and partners.
For Ramage, achieving those outcomes means working with people who share their vision, and in VCIB he found a values-aligned financial partner capable of helping Forum achieve its social and environmental objectives.
“Right away we knew that the VCIB team was in this for the same reasons we are, but they also bring a certain level of expertise in areas that we’re seeking further growth in, like sustainable infrastructure and affordable housing,” said Ramage. “Their thoughtful underwriting and partnership mindset have helped us identify areas to optimize and add value to our investments.”
The relationship began with VCIB providing financing for a portfolio of more than five hundred Ontario-based residential solar rooftop projects acquired by Forum in 2013 and 2014. That solar portfolio represented Forum’s first foray into renewable energy generation. Since then, the team’s understanding of where it is uniquely positioned to contribute to the net-zero transition has evolved.
“We think some of the most exciting opportunities for innovation are with companies and projects that are solving social and environmental problems.”
“For the most part, technologies like wind and solar are now well-understood by traditional investors,” said Ramage. “We see more opportunity in taking on the innovative or niche deals that other institutional investors shy away from.”
They’ve found a sweet spot in revenue-generating distributed energy infrastructure, for example district geothermal projects that employ the energy-as-a-service model, making clean energy more affordable and accessible for property owners while driving down greenhouse gas emissions.
Through a partnership with Subterra Renewables, a geothermal developer and operator, they’re building low-carbon district energy systems across North America, primarily serving multi-residential properties.
“We are bringing geothermal into the mainstream, but we need to make it an easy and cost-effective choice for property developers and owners,” said Ramage. “Flexible and thoughtful capital sources like VCIB are exactly what allows us to do that.”
“Right away we knew that the VCIB team was in this for the same reasons we are.”
In addition to that first solar investment, VCIB has now partnered with Forum and Subterra Renewables on financing for multiple district geo-exchange projects for towers and townhouse complexes in the Greater Toronto Area.
Building back better
Forum’s foresight and early shift into investments addressing challenges like climate change and the urban affordability crisis have become more apparent during the pandemic.
“Due to the current situation, private equity firms are having to adjust and identify their best path forward,” said Ramage of the impact COVID-19 has had on many sectors. “Forum’s existing focus on sustainability and established partnerships with mission-driven institutions like VCIB are what equips us to emerge from the pandemic more prepared and resilient.”
Today, VCIB and Forum are looking at new opportunities for collaboration, particularly as Forum increases its focus on green buildings and other energy efficiency technologies.
“We are constantly looking for new and better ways to drive sustainability – as well as other ESG objectives – in our investing and development activities,” said Ramage.
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