In 2015, The Union Labor Life Insurance Company's Separate Account J (J for Jobs) continued to build on its strong momentum, as it closed 20 loans and invested approximately $1.3 billion. In the past four years, J for Jobs has closed 70 loans for approximately $3 billion.
"J for Jobs continues to serve as a vehicle for building strong communities while seeking competitive returns for investors," said Herbert A. Kolben, senior vice president of Union Labor Life's Real Estate Investment Group. "Going forward, we'll keep searching for quality projects that create good union jobs."
Of the 20 loans closed in 2015, 12 were construction loans for over $1 billion. Not only do these investments seek a competitive return for investors, they also create jobs with measurable economic impacts.
It's estimated that new construction financed with loans from Ullico in 2015 will create over 7,500 jobs, 15 million working hours and $900 million of personal income (including benefits) for union workers. Furthermore, these loans will also generate revenue for local, state and federal governments in the form of sales taxes, income taxes, real estate taxes and so on.
Creating jobs while seeking competitive returns has been part of J for Jobs since its inception. Overall, the program is estimated to have created over 297,000 construction jobs and almost 600 million labor hours. By financing construction of hotels and grocery stores, for instance, J for Jobs has also created tens of thousands of full-time jobs for hotel and service workers.
A changing regulatory landscape signals even more opportunities for J for Jobs. For instance, the Department of Labor issued a bulletin last year regarding Economically Targeted Investments (ETIs). ETIs are products that seek financial returns while generating important economic or social benefits. Like many popular ETIs, Union Labor Life's Separate Account J creates economic benefits in addition to its investment returns.
The bulletin clarified that ETIs can be treated the same as other prudent investments, provided the levels of risk and return are equivalent. This important guidance allows investors to choose plans, like J for Jobs, that also have a beneficial social impact.
On a another front, risk retention rules for banks and Commercial Mortgage Backed Securities (CMBS) lenders should decrease the competition for the financing of projects, says Kolben, creating even more opportunities for Ullico to invest in quality projects that create good union jobs.
Separate Account J is managed by The Union Labor Life Insurance Company (Union Labor Life) and sold through Ullico Investment Company, Inc. (member FINRA/SIPC), both subsidiaries of Ullico Inc., and is offered to properly qualified institutional and accredited investors only.
Investment in illiquid real estate and commercial mortgage loans are subject to additional risks including the potential inability of an investor to redeem units. In addition, fluctuations in interest rates and market volatility may limit available financing for real estate investments thereby adversely affecting the value of the underlying investments, the investment return and the liquidity of the Account.