Impact Report 2022

IMPACT RE PORT 2022

Letter from Our President

I am pleased to present Jonathan Rose Companies’ 2022 Impact Report, where our commitment to affordability, social and environmental impact continues to shape our purpose-driven approach to real estate investment. In a world marked by uncertainty, our steadfast focus on creating equitable, thriving communities remains at the core of everything we do.

Affordability lies at the heart of our mission. In response to the ongoing affordability crisis, we have taken proactive measures to extend affordability contracts, develop innovative ground-up affordable housing projects, and rehabilitate existing properties to create communities of opportunity. By bolstering the affordable housing stock, we are ensuring that communities remain affordable for the long term, empowering individuals and families to thrive in a safe, stable, and healthy environment.

As we navigate a rapidly changing economic and political climate, we firmly believe that environmental, social, and governance (ESG) and impact strategies are not only ethically sound but also prudent investment choices. Our commitment to these principles enables us to mitigate risks while creating long-term value for our stakeholders. By aligning financial performance with social and environmental impact, we continue to demonstrate that profitability, and our impact objectives are mutually reinforcing.

Our dedication to creating financially secure and equitable communities is unwavering. Through data-centric methods, we are working to showcase the tangible impacts of our social services investments. One notable partnership is with Esusu, a leading financial technology platform that helps our residents increase financial access and stability. Esusu's groundbreaking rent reporting platform captures rental payment data and reports it to credit bureaus, enabling tenants to build and establish their credit scores, in addition to providing rent-relief assistance programs and zero-interest microloans. Rose has enrolled over 12,000 individuals in Esusu, helping 72% of residents develop their credit scores and providing over $179,000 in microloans to maintain stability through moments of financial hardship. This innovative collaboration not only benefits residents but also helps property owners reduce turnover and improve rent collections, thereby enhancing operating income.

We are also actively seeking to future-proof our portfolio against the impacts of climate change and the physical, social, and market changes it will bring. We have evaluated the entire standing portfolio for transition risk and developed a decision matrix to evaluate properties with high priority decarbonization opportunities. We are implementing robust electrification strategies and reducing energy demand through efficiency measures, seeking high-impact incentives and grants, and preparing for a carbon-free economy. By incorporating resilience data into our investment strategy, we are mitigating risk and bolstering our properties to withstand severe weather events.

None of our accomplishments would have been possible without the invaluable partnerships we have forged. We are grateful for the collaboration and shared vision of like-minded organizations and individuals who have joined us on this transformative journey.

As we reflect on the past year, we take pride in our achievements, yet we acknowledge that there is still much work to be done. Our dedication to affordability, sustainability, and social impact remains resolute, and we are committed to driving positive change in the communities we serve.

Thank you for your continued support and belief in our mission.

With best wishes,

Jonathan F. P. Rose

Company Overview

Jonathan Rose Companies is one of the country’s leading owners, developers and operators of green affordable and mixed-income communities. Founded in 1989, Rose has created projects with more than $4.2 billion of value with a current portfolio of 19,000 apartment homes in 15 states and Washington, DC. The firm is a fully integrated investment management, development and asset management company with property management, construction management, solar energy, mortgage finance and title company affiliates.

Since our founding, we set out to focus on creating model projects that integrate with environmental and social responsibility. We strive to achieve positive environmental impact by investing in energy efficiency, decarbonization, and water conservation to reduce our use of natural resources and toxins. Our social impact is achieved by preserving and expanding housing affordability, and connecting our residents to health, education, financial, cultural and social services. And we aim to achieve these impacts in a co-creative process with governments, our residents and staff.

Today, we are proud to share stories of our successes and lessons learned as we build a national portfolio and partner with residents and social service providers to roll out our Community of Opportunity Program. Program elements include the planning and development of affordable and mixed-income housing, transit-accessible locations, and accompanying our communities with a mix of uses that enhance their social, environmental, and financial fabric.

Residents and their well-being are at the heart of our model, and we call on all the facets of our firm to renovate and operate in the most sustainable way. The Community of Opportunity Program is a replicable model that enhances the well-being of our residents, while at the same time contributing to the restoration of planetary health.

Mission Statement

Our mission is to create a more environmentally thriving, socially just world through the development, preservation, renovation and management of green, affordable and mixed-income housing.

Our Portfolio 1

$4.2 billion Invested in Acquisitions and Development

100 Properties

19,000+ Residential Units Across 15 States and D.C.

500+ Employees

17,000+ Affordable Units

6 Offices Across the U.S.A.

Impact Strategy

We envision a world in which every community is a thriving landscape of opportunity, in balance with nature, contributing to the common good and enabling its residents and staff to lead healthy, fulfilling lives.

Impact Strategy

We buy and build affordable and mixed-income housing and connect each property with health, education, cultural, and social services to empower residents to become partners in their communities and improve their economic and social outcomes. We also invest in the energy efficiency, decarbonization, water conservation, and resilience of our buildings to lessen our demand for natural resources, in turn mitigating climate change, reducing our operating costs, and improving the health and safety of our residents. These strategies provide economic resilience and add value to our properties, strengthen our financial returns and allow us to ultimately deploy more capital to achieve even deeper impact.

To optimize our impact, we utilize a model of co-creation that is rooted in data and draws upon the input and expertise of an interdisciplinary team of internal stakeholders across business practices, as well as external stakeholders including residents, financing partners, regulatory agencies, nonprofits and consultants. Each member is responsible for viewing our projects through an impact lens and coming together to deliver a collective, cohesive and impactful vision.

We actively focus our investments in economically resilient markets and, when possible, aim to acquire properties and locate new development projects in areas with limited exposure to current and future climate hazards. We invest in impact not only because it’s the right thing to do, but because it is an essential tool in our investment strategy: helping to increase available capital, lower operating costs, enhance income stream stability, and reduce long-term exposure to risk.

As the impact investing landscape rapidly transforms, we will continue to adapt our strategy and lead the way in making greener, healthier, and more resilient communities.

Our business strategy is designed to deliver social and environmental impact as well as competitive, risk-adjusted market returns.

Affordability Strategy

THE CHALLENGE

Across the United States, rents are escalating at an unsustainable pace. In 2021, 20.1 million renter-occupied households were cost burdened, which the Department of Housing and Urban Development (HUD) defines as households that spend more than 30% of gross income on rent.1 This represents an increase of 1 million households since 2019, leaving renters with less income to spend on other necessities such as food, transportation, and healthcare and more vulnerable to eviction.1

The affordability challenge is compounded by the lack of supply. For extremely low-income renters, those whose incomes are at or below 30% of Area Medan Income, there is an estimated shortage of 7.3 million affordable housing units.2 Moreover, low-cost rental units are being lost to market-rate conversions and demolition for new construction.

The affordable housing crisis disproportionally impacts BIPOC communities. Black, Latino, and Native and Alaska Native households are more than twice as likely as white households to be extremely low-income renters.2 These disparities have only become more prominent in the wake of climate change where the effects of extreme weather events have been exacerbated across low-income communities.

Our Approach

For over 30 years, tackling the affordable housing crisis has been core to our business. Our approach revolves around acquiring, developing and preserving low-income housing across the country. Our affordability strategy consists of three mechanisms of change:

ACQUISITIONS

We buy existing affordable housing units to ensure that the housing stock remains affordable for residents predominately earning 30-80% of AMI. We also create new affordable housing units by voluntarily placing income restrictions on naturally occurring affordable housing.

ACQUISITION-REHAB

We leverage 4% and 9% Low Income Housing Tax

Credits to rehabilitate existing affordable housing properties, improving the conditions of the asset to make the communities affordable for the long term.

DEVELOPMENT

We deliver new units of affordable housing through ground-up development. We add critical supply in major markets around the country where demand for affordable housing is the greatest.

(1) Share of Income Needed to Pay Rent Increased the Most for Low-Income Households From 2019 to 2021. US Cencus Bureau, May 2023. https://www.census.gov/library/stories/2023/03/low-income-renters-spent-larger-share-of-income-on-rent.html.

(2) The GAP – A shortage of Affordable homes. National Low Income Housing Coalition. March 2023.

Affordable Housing Typologies

Affordable rental housing is broadly defined by the U.S Department of Housing and Urban Development (HUD) as housing where resident-paid rents are no more than 30% of a household’s gross income. At Rose, we most commonly see three types of affordable housing:

RENT SUBSIDIZED HOUSING

HUD provides rental subsidy through Section 8 Housing Assistance Payment (HAP) contracts. Eligible tenants pay up to 30% of their monthly income toward rents, and HUD pays the owner the difference between the tenant’s payment and the contract rent. Rental subsidies can be either tenant-based (via Housing Choice Vouchers that follow a tenant if they choose to move), or project-based (tied to the real estate and will remain at the property even if a tenant vacates).

RENT RESTRICTED HOUSING

This primarily refers to the federal Low-Income Housing Tax Credit (LIHTC) program, which is administered by state housing finance agencies that allocate a stream of tax credits to developers, who then sell the tax credits to a tax credit investor. Properties are encumbered for at least 30 years by deed restrictions that limit allowable rents to 30% of the household income of renters earning no more than 60% of Area Median Income.

NATURALLY OCCURRING AFFORDABLE HOUSING (“NOAH”)

NOAH refers to properties that are not subsidized or restricted by any government program. These properties are “naturally affordable” due to their age, location, and condition and are also referred to as Workforce Housing. Rose has worked on a case-by-case basis to devise structures with local governments, housing agencies and mission-driven third parties to create new affordable housing deed restrictions in exchange for low-cost financing or tax relief.

Our Affordability Stats

Our portfolio predominately comprises rent subsidized, rent restricted, and NOAH units. We also own several mixed-income properties and properties subject to additional state and local programs that seek to create and preserve affordable housing.

62%, or over 11,000 of the units in our portfolio are rent subsidized through Section 8 HAP contracts (Figure 1). HAP units are nominally restricted to households earning less than 80% AMI, however, in practice, serve deeply vulnerable populations – typically earning less than 30%-50% AMI.

An additional 4,227 units are subject to rent restrictions. This number includes NOAH units on which Rose has voluntarily placed rental restrictions. Only 2,470 units, or less than 14% of our entire portfolio are available to rent at market rates and require no income qualifications (Figure 2).

Rent Subsidized vs. Non-Rent Subsidized Portfolio

NOTES

Analysis excludes Perry Rose assets. assets under construction, disposed assets, and commercial assets. Employee units, where not covered by HAP contract are included as unrestricted units >80% AMI includes Tapestry and Paseo Verde at 130% and Goodwill, which is part of the Mitchell-Lama program.

Integrated Impact in Action: Belage Manor

On May 31st, 2022, the firm acquired Belage Manor Senior Apartments, a 180-unit senior Section 8 and LIHTC community in Anaheim, CA. Jonathan Rose Companies has partnered with Jamboree Housing Corporation to conduct a $10.77 million renovation of the community. The renovation renews the Section 8 project-based voucher HAP contract covering 50% of the units for 15 years and extends the affordability of all units at the California Department of Housing & Community Development (HCD) levels for 50% and 60% AMI for another 99 years.

The firm partnered with the Anaheim Housing Authority to design, scope, and oversee the renovation of Belage Manor Senior Apartments. The renovation will provide approximately $50,000/ unit in hard costs, which will provide much-needed structural improvements and greening efficiencies throughout the building, alongside the expansion of several key community spaces, including the addition of a brand-new fitness center and computer lab.

The building will additionally benefit from a cool roof recoat, elevator modernization, and new site access and pedestrian entryway. Other major improvements include the repairs and replacements of unit and community room balconies across the property, sidewalk and parking lot repairs and accessibility upgrades, and new painting, lighting and flooring throughout the corridors. All units will receive new Energy Star appliances, low-flow plumbing fixtures, LED light fixtures, and new carbon monoxide and smoke detectors. The building will also be brought to Uniform Federal Accessibility Standards (UFAS), which will fully convert nine of the existing units into accessible units, and another four units into audio/visual accessibility units.

The project secured low-interest financing on its first mortgage due to the project’s participation in the Fannie Mae Green Rewards and Enriched Resident Services (ERS) interest rate reduction programs. To obtain the ERS savings, Rose had to qualify as a Certified Organization for Resident Engagement & Services (CORES), and the project had to achieve CORES certification at the property level. The CORES Certification recognizes organizations that have developed a robust commitment, capacity, and competency in providing resident services coordination in affordable rental housing.

INCOME LEVEL SERVED AMI 50 - 60%

PROJECTED ENERGY SAVINGS

21%

PROJECTED WATER SAVINGS 31%

TOTAL RENOVATION COST $10.8 m

Impact Management System

We have developed an Impact Management System (IMS) which organizes the commitments, plans, implementation, monitoring, and evaluation strategies into an implementation framework that guides our impact delivery process and improves outcomes for our communities, company, and investors.

Our impact management begins with our deep commitment to enhancing social well-being and improving our ecological footprint, which we define through a multi-stakeholder strategic intent and goal-setting process. We set portfolio-wide targets for our company, investments, and investment funds that establish guidelines for housing affordability, social impact, environmental goals, and governance priorities. We commit to both what we will do and how we do it by underpinning our impact delivery strategies in established third-party frameworks. Our IMS is aligned with the Operating Principles for Impact Management and its embedded environmental management system is aligned with the ISO 14001 protocol.

PLAN

We tailor impact plans for each investment, utilizing a data-driven, co-creation model. Our interdisciplinary team includes members of acquisitions, construction, asset management, property management, and impact professionals who leverage third-party technical consultants, tools, site visits, resident engagement, and deep experience to evaluate properties and development opportunities that optimize for impact and financial returns.

IMPLEMENT

We bring the impact plan to life through physical and operational changes upon acquisition. We renovate projects to deliver spaces that facilitate our social programming and green retrofits that will achieve the environmental goals of the project. We also train and empower the site staff to deliver the social and environmental mission in day-to-day operations by hiring impact-dedicated staff like Resident Services Coordinators, and utilizing established protocols and programs.

MONITOR

Impact is continuously tracked, measured, and reported. We utilize a survey platform to gather data about implementation of social programming at sites and a utility monitoring platform to track environmental performance. We also use an internal social media platform to facilitate peer-to-peer sharing of best practices, successes, and challenges. The data is assessed by the impact team and communicated internally and externally through quarterly reports and our yearly Impact Report. Close collaboration with asset managers and property managers surfaces successes and issues to facilitate action.

EVALUATE

To achieve continuous improvement, deepen impact and deliver results more efficiently, we assess performance against the impact plan and goals on a periodic basis. Quarterly meetings and annual business plan reviews provide forums for updates on impact delivery, sharing of lessons learned, and executive-level feedback on strategic initiatives. We aim to achieve impact at exit through responsible disposition of assets and conduct an ex post analysis of our investments to inform future strategies and implementation.

IMPACT MANAGEMENT SYSTEM FRAMEWORK

Review and improve impact decisions and processes based on achievements and lessons learned. Continuously improve in subsequent investments and commitments.

IMPACT MANAGEMENT SYSTEM

EVALUATE PLAN IMPLEMENT MONITOR

Track, measure, and report impact and financial performance. Communicate progress to all parties and make adjustments as appropriate.

PLAN

• Impact Opportunity Score

• Site Inspections & Due Diligence

• Energy Audits

• Green Certification Feasibility

• Resident Engagement & Surveys

• Scope Development

IMPACT MANAGEMENT TOOLS + STRATEGIES

IMPLEMENT

• Renovations and Retrofits

• Communities of Opportunity Toolkit

• Resident Services Coordinators

• Green Operations

• Clean Energy Procurement

MONITOR

• Utility Tracking and Real-Time Monitoring

• Web-based Service Coordinator Software

• Internal & External Reporting

• Annual Impact Report

Evaluate opportunities using proprietary and third-party assessment tools and co-create impact plans to achieve desired goals.

Make physical changes through construction and train staff and service coordinators to implement operational vision.

EVALUATE

• GRESB Survey

• Impact at Exit Memos

• Lessons Learned Meetings

• Impact Management Committee Reviews

Our Location-Based Opportunity Index

To assist our teams in balancing the company’s financial, resilience, and social impact goals, we sought out a location intelligence tool that could rapidly scan geographic locations and layer in a multitude of maps and data points to generate actionable insights and inform our business planning. In 2022, we partnered with a company called Datastory and their geo-spatial intelligence tool, MapDash, to ultimately develop a proprietary Opportunity Index. Our Opportunity Index enables us to score and compare the relative strengths and weaknesses of specific geographies across more than 20 individual data points encompassing economics, demographics, social vulnerability and climate risk and resiliency.

MapDash additionally helps us rapidly funnel new acquisition opportunities and use our team’s time and resources as effectively and efficiently as possible. The insights gathered from MapDash and our opportunity index directly inform our capital and operational business plans – with a focus on physical resilience and social services investment. The tool also aids us in moving beyond subsidized and regulated affordable housing to identify opportunities for broader community transformation.

MapDash compares geographies at the Census Block Group level up to the Metropolitan Statistical Area, state, and regional levels. ArcGIS contains a multitude of data sets, from demographic to environmental to community infrastructure. These data sets can be layered on top of one another and examined concurrently, allowing our team to evaluate the risks of a property and its location from multiple perspectives.

(Right) By overlaying the FEMA Flood Hazard Index and the Section 8 data sets, we can view Section 8 buildings in Lower Manhattan alongside the FEMA indicated high-risk flood zones. This layering of maps allows us to quickly ascertain environmental risk, and the conclusions of this comparison will directly impact our underwriting assumptions.

Materiality Assessment

In 2020, Jonathan Rose Companies issued a materiality assessment to evaluate key environmental, social and governance (ESG) topics based on input from a diverse set of internal and external stakeholders. The materiality assessment referenced topics from leading ESG reporting frameworks, including Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD).1 In this study, a topic is deemed material to Jonathan Rose Companies by weighing two factors: business impact and organizational importance.

• Business Impact – the effect the organization has on the topic, which can indicate its contribution (positive or negative) to sustainable development.

• Importance to the organization and its stakeholders – the degree to which a topic is aligned with the organization’s vision and the extent to which stakeholders express interest and concern for this topic.

The assessment identified climate-related social resilience as the top material priority for the firm, with physical resilience also in the top 10, reinforcing our commitment to investigating risk and strengthening resilience by community building and physical alterations. The findings also emphasized the importance of energy and emissions reductions, which have spurred the development of a decarbonization strategy, as well as the importance of transparency around issues of diversity and equity, which are being addressed by a number of initiatives led by the Anti-Racism Committee and Talent & Culture. In 2024, Jonathan Rose Companies will reissue the materiality assessment and survey an even wider array of key stakeholders across a multitude of ESG topics.

Sustainable Development Goals Supporting Our Impact Strategy 1

Promote healthy living at all Jonathan Rose Companies properties.

• Provide all residents with education on safety, nutrition, and healthcare through the Communities of Opportunity program

• Provide fitness facilities and organize exercise programming such as yoga, walking, and dance

• Facilitate on-site health screenings and exam space

• Improve indoor air quality with ventilation and healthy building materials

Procure green power for all properties, when feasible, and reduce energy demand through efficiency and conservation.

• Reduce energy consumption through conservation measures

• Install solar panels and other renewable sources of energy on-site

• Purchase renewable energy credits to offset energy usage

Provide safe and affordable housing, access to safe and inclusive green spaces, and reduce the adverse environmental impacts of cities.

• Preserve affordable housing for the long term

• Acquire and develop properties with appropriate urban density

• Support public policy that improves environmental conditions locally

• Design green and open space to facilitate access to nature

Minimize negative environmental impacts by reducing waste through recycling and implementing sustainable procurement practices.

• Reduce waste generation through responsible procurement and operations, including a shared community goods library

• Implement and optimize recycling and compost programs

• Select products with minimal use of toxic chemicals and facilitate responsible disposal of hazardous materials

Reduce energy, emissions, and water intensity at all properties and strengthen resilience against future climate impacts.

• Set goals to achieve energy, water, and emissions savings and implement strategies and plans to achieve them

• Reduce site-level fossil fuel consumption by implementing electrification and on-site renewable generation

• Assess current and future climate risk at all properties and implement strategies to improve resilience

Encourage and promote public, public-private, and civil society partnerships to build strategic relationships and expand reach.

• Partner with local and national agencies to enhance the affordable housing market

• Engage local and national partners that align with our social and environmental mission

• Increase social and civic engagement of employees and staff through voter registration

Social Impac t

Social Impact

Implementing our vision for Communities of Opportunity requires purposeful outreach and connection with residents and their unique networks, resulting in each property having its own culture, and using its own strengths to better the community as a whole. We utilize an Asset Based Community Development (ABCD) model that encourages active community participation and leadership from residents as we collaborate with them to implement positive change in their communities and pursue sustainable solutions.

Our Communities of Opportunity model strengthens social connectivity and builds a culture of caring at our communities, where neighbors and staff know one another and help one another in times of need. As we witness the effects of climate change and social polarization and disorder, ensuring the resilience of our communities becomes increasingly vital.

We recognize the importance of integration as a driver of opportunity. We focus our acquisition and development effort in areas where we can connect our residents to affordable transportation networks, high-speed internet access, healthcare, education, retail and employment networks. We acquire and preserve existing affordable housing in locations that have the potential to realize our Communities of Opportunity vision.

Communities of Opportunity strive to connect our residents to opportunity by co-creating health, social services, education, and recreation programming alongside our residents and employees.

Communities of Opportunity

Our vision for Communities of Opportunity is to empower and connect residents through the co-creation of housing-based programs to improve their health and well-being – resulting in better life outcomes, using great housing communities as the platform. We view high-quality affordable housing as a foundation for health.

Through the strategic development and implementation of the Communities of Opportunity program, we strive to create a more socially just world and equalize the landscape of opportunity through co-created strategies centering around what we call the “10 Categories of Impact.” These 10 categories contain key strategies for building a Community of Opportunity. We seek results that improve the social determinants of health and create opportunity in all properties across our portfolio by providing scalable strategies to improve our residents’ lives.

Measuring Our Impact

A particular focus for our social impact work is gathering data to quantify the size and impact of our Communities of Opportunity program. The development of metrics to measure the efficacy of our programming is critical to making the case for policy changes and to help secure impact investments in our preservation funds.

We have identified three core focus areas to help demonstrate the impact of residential services and other on-site programming:

HOUSING STABILITY HEALTH AND WELL-BEING FINANCIAL SECURITY

Within these three categories of work, we use industry standard key performance indicators that help us track trends on a quarterly and yearly basis to better understand program outcomes and adjust interventions as needed at each property. These metrics correspond with standard frameworks that have been developed by industry leaders including Stewards of Affordable Housing, the Global Impact Investing Network, and GRESB.

10 Categories of Impact

SAFETY

Ensuring that our residents feel safe and secure at home is key to improving their lives.

Practice: Vial of Life, scam prevention trainings, programming with police, disaster preparedness

COMMUNITY BUILDING AND RECREATION

Connecting residents with their neighbors creates a sense of connectedness and can contribute to overall well-being.

Practice: Back-to-school drives, Mommy and Me playgroups, music, art, and dance classes

LIFELONG LEARNING

Providing education support and technology to children and adults fosters a foundation for success.

Practice: ESL classes, GED test classes, computing classes

CIVIC ENGAGEMENT

The voice of our residents is extremely important in civic life, and participation can influence policies that may affect their daily life.

Practice: Voter registration, community cleanups, intergenerational volunteerism

FOOD SECURITY

Distributing free or discounted healthy food on campus helps reduce food insecurity and improve health and well-being for our residents.

Practice: mobile food pantries, Meals on Wheels, community gardens, SNAP benefits

HEALTHY LIVING

Encouraging a healthy lifestyle can greatly improve residents’ physical and mental health.

Practice: Health screenings, health education, fitness groups and events, nutritional programs, mental health services

GREEN EDUCATION

Building environmentally friendly properties can instill sustainable habits in the lives of our residents.

Practice: Recycling education, green cleaning supplies, Go Green Week TRANSPORTATION

Access to safe and reliable public transportation can increase opportunities for our residents.

Practice: Schedules and routes displayed in lobbies, support with access to transport

FINANCIAL SECURITY

Economic stability is essential in ensuring the long-term success of our residents.

Practice: Benefits assistance, tax preparation and preparedness, budgeting classes, couponing

COMMUNICATION, INFORMATION, AND TECHNOLOGY

Transparent and frequent communication between building staff and residents is vital to creating impactful communities.

Practice: Digital access, bulletin boards, Opportunity Walls, monthly calendar of events

Research Project Highlight

Jonathan Rose Companies and the Community Opportunity Fund have partnered with Columbia University's Mailman School of Public Health, Dartmouth Institute for Health Policy & Clinical Practice, Harvard University's T.H. Chan School of Public Health, Enterprise Community Partners, and Success Measures at NeighborWorks America to study the effects that the Communities of Opportunity model, which combines social and environmental interventions, on resident health and well-being. The grant-funded research will look at how the way we deliver affordable housing and resident services is related to these outcomes. Our goals for the study are twofold. One, we hope to improve the way we deliver resident services and encourage resident engagement. Second, we hope the results will drive changes in housing policy in ways that enable resident services to be delivered as a fundamental part of affordable housing and that promote resident health and well-being.

The initial phase of the research, to be conducted in 2023, will be to survey residents. The survey will include questions about their experience living in the building and participating in resident services, a health and well-being assessment, demographic information, and satisfaction with their building and unit. A second phase of the research will be to install air quality monitors at the 10 properties to collect data on air quality and pollutants in units and public spaces. The results of the initial study phase will be presented back to the residents, along with a small grant that will be available to properties to use for programmatic improvements. Later phases will include a follow-up resident survey, data analysis, reporting, and planning for study continuation.

We are excited for this opportunity to investigate how our work affects our residents’ health and well-being and hope the results lead to improvements in affordable housing services at a company and national level. We look forward to sharing results and insights from the study over the next several years.

STUDY TO BE CONDUCTED ACROSS:

3 YEARS

10 PROPERTIES

2,976 UNITS

SHORE HILL APARTMENTS - Brooklyn, NY

The survey kick-off event at Shore Hill Apartments in January brought together 150+ residents to participate in the initial round of research.

Communities of Opportunity Tour

Our Communities of Opportunity program includes a combination of services, programs and physical spaces. Areas for residents to gather, socialize, access technology and engage in physical activity all contribute to positive outcomes. A Resident Services Coordinator, Community Manager and engaged resident population are helpful in activating the physical spaces. Below are the key physical design elements to support a full Communities of Opportunity program, which each property strives to incorporate as space, layout and budget allow.

1

COMMUNITY ROOM

Each property should have a multipurpose community room where people can gather for social, health and educational events, access high-speed internet and is where important information can be posted in a centralized location. This room is the hub of the community.

2

OUTSIDE/GREEN SPACE

Access to green spaces positively influences mental and physical health by connecting people with nature, but there is disparity in access along racial and socioeconomic lines in the United States. We strive to mitigate that disparity by bringing safe green outdoor space to all our developments.

3

SCREENS

Bulletin boards and digital screens are used to share information about the larger community, advertise upcoming events, and share transportation information.

4

FITNESS ROOM

Physical activity improves overall well-being and reduces the risk of negative health outcomes. We provide a fitness room with equipment tailored to residents’ abilities and schedule regular health and fitness programming. 7

RESIDENT SERVICE COORDINATOR

A Resident Service Coordinator is employed to connect with community partners, connect residents with vocational and educational opportunities, and help with healthcare coordination. The coordinator also plans social programming and makes referrals.

5

COMPUTER LAB

Technology is an increasingly important part of life and is becoming necessary to complete schoolwork, pay bills, and access resources, yet many low-income residents do not have access to computers or the internet. We provide access to internet-connected computers and devices in computer labs and education spaces.

KITCHEN

6

MEDICAL SCREENING ROOM

A common barrier to receiving medical care for many elderly or disabled individuals is mobility and access to transportation. A private medical screening room allows nurses, podiatrists, and other health experts to provide much-needed medical care on-site.

8

In addition to being used for nutritional demos, cooking together and sharing a meal as a community is a great way to build bonds and increase social connectedness.

9

LIBRARY

Having a designated library can help improve literacy rates and allows educational material to be easily accessible. Jonathan Rose Companies encourages properties to stock libraries with culturally appropriate books.

LOBBY BULLETIN BOARDS/DIGITAL

GOLDEN WEST TOWER - Torrance, CA

Communities of Opportunity in Action: Digital Access 1

Digital connectivity deeply determines people’s access to health, livelihood, education, food, financing, information and political influence. We are working hard to improve digital connectivity within our portfolio of affordable and mixed-income housing. The aim of our digital connectivity initiative is to overcome the digital divide and achieve equal distribution of access to information and communications technology.

In 2022, we set about mapping the connectivity of our properties and embarked on a procurement project to bring affordable internet service to all properties without an existing internet service provider (ISP). Our contract conditions require all new ISP’s to promote the Affordable Connectivity Program (ACP) and support enrollment by residents into the program.  The ACP is a federal government program that helps low-income households pay for broadband service and internet-connected devices. Raising awareness of the program and assisting residents sign up to receive the subsidy is a critical part of our digital connection strategy.

Providing internet to our properties is only part of the solution. Affordability of devices and access to effective training programs also represent significant barriers to digital connectivity. Our community staff continue to access local resources to make low- or no-cost devices available to our residents. We have also launched a pilot device lending library process to help provide easy and free access to devices at our properties.

In 2022, we launched digital training for all residents covering technology basics, online rent payments, and maintenance requests and providing access to community and education resources.

MIRAMAR TOWERS - Los Angeles, CA

ACP APPLICATIONS COMPLETED

602

NEW RESIDENTS CONNECTED TO THE INTERNET

939

DEVICES PROVIDED TO RESIDENTS

1,078

RESIDENTS TRAINED IN COMPUTER BASICS

1,016

Our community staff continue to work with internet service providers and other community-based organizations to help with internet connection, ACP sign-up, device provision and digital training.

Communities of Opportunity in Action: Esusu Case Study 1

In 2019, we partnered with Esusu, a leading financial technology platform helping residents save money and build credit, to increase financial access and stability for our residents. Founded in 2016, Esusu's groundbreaking rent reporting platform captures rental payment data and reports it to credit bureaus to boost credit scores. This enables residents to build and establish their credit scores while helping property owners reduce turnover and improve collections to increase their operating income. In addition to on-time rent reporting, our residents can access Esusu’s rent relief assistance program, which provides zero-interest microloans during temporary financial hardship.

Taken together, these programs improve residents’ financial stability, which in turn leads to greater housing stability. Access to affordable credit removes the borrowing costs for residents and enables them to save money over the long term. Since the program began, 72% of residents have increased their credit scores and 410 residents have established credit for the first time. The microloan program reduces eviction for residents who are experiencing hardship. As a result, we are able to keep residents in housing and reduce turnover costs.

We are expanding the program to our third-party managed properties in 2023.

SQUIRE VILLAGE - Manchester, CT

NUMBER OF PROPERTIES PARTICIPATING 70

NUMBER OF RESIDENTS ENROLLED 12,718

MEDIAN CREDIT SCORE ACHIEVED 693

AVERAGE RENT RELIEF PAYMENT DISBURSED $2,350

TOTAL MICROLOANS DISBURSED $179,781

Environmental Impact

Environmental Impact

The built environment contributes to approximately 40% of all CO2 emissions in the United States,1 therefore renovating the existing building stock and holding our new developments to the highest environmental standards must be part of the solution. We aim to meet this challenge by reducing the climate and resource impact of our portfolio while creating resilient, future-proof properties.

Meeting and creating rigorous environmental criteria for our buildings has been part of our ethos from the earliest days of the company. In the early 1990s, Jonathan Rose recognized the need for a comprehensive, structured approach to developing buildings that had a positive impact on the natural environment by creating a set of principles to guide projects in responsible development. These principles led to the creation of the Enterprise Green Communities Certification2 program. Over the last 30 years we have developed some of the country’s most environmentally friendly affordable housing projects using innovative design, financing, and partnerships, and we continue to lead the field in delivering healthy, sustainable, transit-oriented housing.

Today, our impact includes influencing city, state, and federal policies and programs, advocating for, and participating in the greening of existing buildings, and developing innovative solutions for the buildings of tomorrow. Our new development pursuits take advantage of industry-leading techniques such as all-electric, high-performance, resilient design and incorporating renewable energy and storage wherever possible. Our green retrofits are most often designed around the Enterprise Green Certification program. This includes implementing cost-effective measures such as installing LED lights and sensors, upgrading to low-flow water fixtures, adding insulation, and improving air sealing. We take a data-driven approach to monitor and analyze environmental performance at all our properties to uncover further energy and water efficiency opportunities.

From ambitious beginnings to industry-leading projects, we understand the importance of creating replicable models that achieve impact at scale. We will continue to lead and learn alongside our peers as we combat climate change, develop the tools of the future, and focus on the health and well-being of our residents.

We are in a climate crisis. The harm and suffering caused by extreme weather events, biodiversity loss and toxic pollution are disproportionately distributed to the poorest, most vulnerable, and most disenfranchised populations around the globe.

Climate Change Mitigation Goals1

In order to reduce our impact on the environment, we have set forth a series of climate-change mitigation goals for our portfolio. These mitigation goals aim to reduce the emissions, energy, water use and landfill waste from our properties over time. We establish a baseline for each property and actively work to achieve the goals by implementing improvements and continuously monitoring performance. We strive to achieve the targets at each individual property to contribute to our overall portfolio goals.

GREENHOUSE GAS REDUCTION

We design, construct, retrofit and operate properties to minimize their emissions of greenhouse and ozone-depleting gases. We are committed to both mitigating through reducing emissions and adapting to our changing environment.

GOAL

Reduce carbon dioxide equivalent (CO2e) emissions intensity by 20% or more from baseline.2

ENERGY REDUCTION

We design, construct, retrofit, and operate properties using strategies to reduce energy use, including integrated design, efficiency improvements, conservation measures, and optimized operations.

GOAL

Reduce energy intensity by 20% compared to baseline.2

WATER REDUCTION

We design, construct, retrofit and operate properties to make the most efficient use of water resources, minimize consumption and reduce adverse effects on water infrastructure systems.

GOAL

Reduce water intensity by 15% compared to baseline.2

WASTE REDUCTION

We design, construct, retrofit, and operate properties to minimize waste sent to landfills. We aim to design waste out of our processes and to divert landfill waste through recycling and composting.

GOAL

Increase the amount of waste diverted from landfills by 15% from baseline.2

FACADE AIR LEAKAGE TEST AT SENDERO VERDE

Decarbonization Highlight

The real estate sector will need to play a key role in curbing harmful emissions by reducing its reliance on fossil fuels and adopting clean energy. To build on our climate change mitigation goals, in 2022 we engaged with WSP, an internationally recognized engineering and consulting firm, to design a long-term decarbonization strategy for our entire portfolio. Our strategy tackles decarbonization both by reducing energy demand at assets through energy efficiency and electrification, and by ensuring that the energy sources powering those assets are carbon-free through long-term power purchase agreements and on-site renewable energy systems. The analysis vetted each asset for decarbonization potential, and we are now targeting the highest opportunity assets for detailed decarbonization assessments and scope development.

Electrification, or the conversion of gas-fueled building systems to electricity, is a crucial tool in the fight against climate change. To date we have completed multiple electrification projects in the portfolio, including the conversion of domestic hot water systems at Miramar Apartments and Casa Panorama in California. As the need for these projects grows, we continue to expand our capacity to integrate electrification into our assets wherever feasible.

In parallel with the development of our portfolio decarbonization strategy, in 2022 we created a comprehensive framework to guide internal decision making on the electrification of building systems. Our framework empowers us to identify the electrification projects that can maximize impact, given an array of characteristics such as availability of monetary incentives, cleanliness of the power grid and the impact on operating costs. Our goal is to assess every new acquisition and owned asset with this framework.

ELECTRICFICATION PILOT

Rose is partnering with Chicago-based Elevate Energy on a pilot project to electrify mechanical systems at Lake Grove Village. The project intends to replace the existing gas-based heating and domestic hot water systems with electric heat pump systems. The work is projected to reduce the building’s greenhouse gas emissions by 28% in year one, and energy consumption by 57%, in addition to providing improved indoor air quality and comfort for residents.

LAKE GROVE VILLAGE - Chicago, IL

9 DECARBONIZATION ASSESSMENTS COMPLETED IN 2022

$2.4 m IN ELECTRIFICATION INCENTIVES SECURED1

(1) Incentives are contingent on completion of projects in 2023.

Environmental Retrofit Tour

We tailor each property’s renovation scope to the specific needs of the site and its residents. However, we have a standard set of commonsense retrofit measures that we typically implement to achieve utility savings, improve indoor environmental quality and attain Enterprise Green Communities Certification when feasible. Some of these important measures include the following:

INSULATION & AIR SEALING

Adding and supplementing insulation to a property’s roofs and walls helps the building retain heat in the winter and slows heat from reaching the interior in the summer. Air sealing also improves the building’s fire resistance, reduces pest problems, and limits noise transfer and movement of odors between different parts of the building.

HIGH-PERFORMANCE WINDOWS

Replacing windows at the end of their useful life with higher-performance models can substantially reduce heat loss and gain within a building, reducing utility bills, and improving resident thermal and acoustic comfort. We select ENERGY STAR windows specific to each region.

SOLAR PV & BATTERY STORAGE

Rooftop Solar PV systems allow for a portion of the building’s electricity demand to be generated by natural sunlight. Where feasible, Solar PV Systems are paired with battery storage, which allows the site to utilize the stored energy during emergency situations like power outages.

INDIGENOUS PLANTS & EFFICIENT IRRIGATION

Our landscape design prioritizes indigenous, noninvasive, drought-tolerant plants that encourage biodiversity and restore precolonial ecology. Efficient irrigation technologies such as drip irrigation systems, irrigation timers, moisture control sensors, and rain delay controllers all help reduce water consumption while maintaining healthy plant life.

BOILER TUNING & CONTROLS

Tuning boiler systems ensures that equipment is running optimally and according to original design intent. Adding or upgrading control systems helps systems respond to changes in outdoor temperatures and indoor heating and hot water demands. At the end of a boiler’s useful life, replacing equipment with high-efficiency, condensing models can greatly reduce energy use and emissions and improve indoor air quality.

LIGHTING FIXTURES & CONTROLS

Upgrading existing light fixtures and bulbs with high-efficiency LED systems significantly reduces the property’s electrical demand while maintaining or improving existing light levels and reducing ongoing maintenance costs. We also install occupancy sensors, timers, and photocells that decrease energy use by providing light only when necessary.

HEALTHY MATERIALS

Setting rigorous environmental standards for product procurement can help ensure that residents remain healthy and building interiors remain resilient. Product categories including hard-surface and soft-surface flooring, paints, cabinets, sealants, and adhesives have third-party certifications that test for reduced VOCs and other toxic chemicals.

ENERGY-EFFICIENT APPLIANCES

Always-on or frequently used appliances such as refrigerators, dishwashers, washing machines, and dryers should be upgraded to energy-efficient ENERGY STAR models whenever feasible. Efficient appliances help reduce annual utility costs, greenhouse gas emissions, and operational costs.

LOW-FLOW FAUCET AERATORS, SHOWERHEADS, AND TOILETS

Low-flow faucet aerators, showerheads, and toilets reduce water use and lessen the demand for hot water, which translates into direct utility savings for residents and building owners. Selecting fixtures that are WaterSense labeled helps ensure that functionality is maintained while using less water.

THE SPRINGS - La Mesa, CA

Environmental Impact in Action: The Grove Case Study1

The Grove Apartments is a 101-unit senior Section 8 property located in Ontario, CA. Upon acquisition in 2017, we utilized California’s Low-Income Weatherization Program (LIWP) to perform a comprehensive green retrofit with a focus on reducing greenhouse gas emissions and increasing overall energy and water efficiency at the community. Retrofit measures included LED lighting with advanced controls, low-flow water fixtures and extensive air sealing and pipe insulation.

Additionally, the site utilized significant incentives through LIWP to upgrade its domestic hot water boilers from gas-fired systems to electric heat pump water heaters. During the installation of the heat pump water heaters, multiple gas-fired hot water heaters were found to be in poor condition, which lead the team to replace them with high-efficiency instantaneous gas water heaters sized as secondary systems. This replacement freed up space in the boiler rooms and provided a DHW backup for the property. The fuel conversion was projected by LIWP to reduce emissions by 24 MT CO2e annually, with a projected total reduction of 68 MT CO2e for completion of all LIWP measures.

After completion of the LIWP retrofit, The Grove Apartments installed a WaterSense-rated smart irrigation controller which utilizes real-time, web-based climate monitoring to allow staff to significantly reduce water use from irrigation while also maintaining proper watering schedules. The smart controller, coupled with an enhanced irrigation policy, has led to an additional 14% reduction in water use since installation.

ACTUAL ENERGY REDUCTION2 16%

ACTUAL WATER REDUCTION2 20%

ACTUAL EMISSIONS REDUCTION2 15%

RETROFIT COST $307,750

NET COST TO OWNER $57,210

PAYBACK PERIOD 3.5 Years

Resilience

As we witness the effects of climate change – increased wildfires, stronger hurricanes, flash flooding-take hold in our country, ensuring that the resilience of our portfolio is crucial. As an organization dedicated to providing housing and opportunity for our residents, we strive to build resilience into our business model at all levels. Thanks to our mission of managing funds with a strong focus on social and environmental impact, we have spent years developing our approach to resilience planning and investment, which makes our communities stronger and reduces risk to our investors. Energy-efficient buildings are inherently safer in extreme climate conditions and the social cohesion spurred on by resident engagement and social programming creates community bonds that are critical during an emergency. To future-proof our portfolio, we have developed a resilience policy that addresses physical, social and transitional risk across three key stages of asset management and ownership: acquisition, design and operation.

ACQUISITION

During due diligence of investment properties, we undertake a series of assessments and studies to identify and mitigate risk. As we evaluate potential properties for acquisition, we consider the likely risks for a property based on its location, such as flood, earthquake, extreme storms, or tornados. We do not invest in properties with severe, imminent risk, such as those located in a floodplain. However, some risks are so widespread that they are somewhat unavoidable – such as earthquake risk in California or tornado risk in the Midwest. In these locations, we evaluate building construction type, condition, and structural integrity for resilience against the local risks and will only move forward with properties that are well suited to withstand severe events. In our deal underwriting, we include budget for capital improvements to enhance the resilience of projects.

DESIGN

Understanding and anticipating regulatory risk such as New York’s Local Law 97 or Washington, D.C.’s Building Energy Performance Standard, is fundamental to our approach to managing the financial risks associated with a transition to a low-carbon economy. Not only do we design and budget for our buildings to comply with current and anticipated energy, emissions and sustainability targets, we also incorporate design for the future energy grid to ensure preparedness for a shifting energy market. We continue to design greener and more resilient buildings, in the face of ever-evolving physical risks due to climate change. We incorporate healthy building materials and sustainable practices into our development and operating strategies.

OPERATION

Recognizing the importance of moving away from fossil fuels, we actively take steps toward the electrification of our energy sources and purchase renewable energy credits and carbon offsets in local markets across the country. Through our green commitments and Rose Solar, we reduce the climate impacts of our communities and help make them more resilient in the face of climate change. We integrate management of physical risks into our overall risk management strategy, not just at the asset level through rigorous due diligence, but also at the portfolio level. Recently, we have conducted a portfolio-wide risk assessment of current and future climate hazards for each asset in our portfolio. Working with property and facilities staff and our insurance carriers, we evaluate which risks are most relevant to each property, assess current preparedness, and implement recommended measures to improve resilience.

Rose Companies Portfolio Characteristics1

The Rose Companies portfolio has reduced its collective emissions intensity by 7%, its energy use intensity by 9% and its water use intensity by 9% against a blended baseline.

Environmental Performance6 Annual Net Avoided Emissions7

Each year, the Rose Companies portfolio can account for its net avoided Greenhouse Gas Emissions at each owned property against baseline year emissions. The waterfall chart below shows the net annual avoided emissions for the portfolio cumulatively from 2008 through 2021.

TOTAL EMISSIONS AVOIDED

19,974 MTCO2e

EQUIVALENT TO CARBON SEQUESTERED BY 330,000 TREES GROWN FOR 10 YEARS

(6) This data reflects the sum of annual consumption data for owned and realized assets as of December 31, 2021 (for owned assets) or the last available year of data (for realized assets) against a blended baseline. The blended baseline establishes an emissions intensity, energy use intensity, and water use intensity for the portfolio using 12-months of utility data prior to, or immediately following, acquisition of each property divided by the total floor area. Performance data was calculated and verified by CodeGreen Solutions using utility data tracked in ENERGY STAR Portfolio Manager.

(7) Custom analysis performed by CodeGreen Solutions utilizing third-party-verified emissions performance data tracked in Energy Star Portfolio Manager.

Monitoring and Reporting Environmental Data

Closely monitoring and tracking the environmental performance of our properties is paramount to successful and persistent delivery of climate impact. We continuously benchmark property performance using utility bill data. Every property we build or acquire is enrolled in Bright Power’s EnergyScoreCards software platform to digest utility bill data, analyze end-use energy data and compare performance across the portfolio and against peer properties to help inform actionable improvements. In addition, we track implemented energy and water conservation measures, along with financial data, to perform measurement and verification of impact. Within our culture of continuous improvement, we use performance data to make adjustments and inform future projects.

We also utilize the ENERGY STAR Portfolio Manager software tool, by the U.S. Environmental Protection Agency, to evaluate energy efficiency relative to a national standard. To assess whole-building energy efficiency, we work with utility providers to access aggregate utility consumption data, and in the absence of that, collect data releases from residents to estimate whole-building performance. Our emissions calculations are based on World Resource Institute’s Greenhouse Gas Protocol utilizing Portfolio Manager data.

Our comprehensive environmental reporting program ensures that stakeholders are well informed. We deliver property performance reports quarterly to property teams and update executives and investors on property and fund-level environmental performance on a quarterly basis. Annually, we respond to the Global Real Estate Sustainability Benchmark (GRESB)1 platform for all our investment funds, including voluntary modules such as Resilience as appropriate. Further, we publish an annual Impact Report to summarize social and environmental performance and highlight case studies to share successes and learnings.

PLANS AND POLICIES

Environmental policies touching on a wide range of topics are implemented across business units and guide our approach to addressing critical health and environmental issues. Our environmental policies include:

• Greenhouse Gas Emissions management

• Energy management

• Water management

• Waste management

• Construction Waste management

• Indoor Environmental Quality

• Healthy Building Materials

• Resilience

• Biodiversity and Habitat

• Active Living

• Green Power Procurement

• Integrated Pest Management

• Green Cleaning and Janitorial Requirements

Governance Strategy

Our Integrated Management Approach

Our company is organized to co-create and deliver innovative and impactful investments by sharing lessons, best practices, and resources across all our business practices. We have an integrated investment management and development group that buys and builds properties, supported by our design and construction team, property management company and internal and external groups to successfully deliver on our vision.

GRACE WEST MANOR - Newark, NJ

SENDERO VERDE - Harlem, NY

PIEDMONT - Oakland, CA

NC FIVE - Philadelphia, PA

INVESTMENT MANAGEMENT

Our investment management group consists of acquisitions, asset management, impact teams, portfolio management, fund accounting, and investor relations. We conduct interdepartmental due diligence to understand an asset’s historical financial, environmental, and social performance and identify opportunities for property improvements and value creation through creative financing, income generation, and operational savings.

ACQUISITION-REHAB

Our Acquisition-Rehab work leverages Low Income Housing Tax Credits to rehabilitate existing affordable housing properties across the country to transform communities and preserve affordability for the long term. Our interdisciplinary Acq-Rehab team navigates complex regulatory systems across a variety of agencies and stakeholders and brings in capital partners to execute transformational deals that address deferred maintenance, deliver deep environmental benefit, and improve resident experience.

DEVELOPMENT

Our development team oversees all new affordable and mixed-income construction projects in the Jonathan Rose Companies portfolio from proposal to occupancy. Utilizing creative design and financing solutions, we work with community partners, government agencies, and our designers to deliver our vision for a greener and more equitable world through models that can be replicated by other developers.

PROPERTY MANAGEMENT

Rose Community Management (RCM) - our property management company - delivers hands-on, customer-focused services to our residents and economic benefits to our owners. Our community-based teams are focused on ensuring that the properties we manage are socially, environmentally, and financially healthier and more vibrant places to live.

DESIGN AND CONSTRUCTION

Our Design and Construction practice group collaborates on all projects across the new development and investment pipeline to coordinate and implement project scopes and achieve our environmental and social goals. Our growing inhouse construction group, Rose Community Builders (RCB), specializes in renovating our occupied communities and acts as a general contractor to help streamline schedules at many of our acquisition-rehab projects.

Who We Are

OUR PEOPLE

The impact we have as a company is undoubtedly dependent on the talent and expertise of our rapidly growing and diverse team of professionals. At Jonathan Rose Companies, over 500 employees now enjoy a workplace culture that inspires excellence and encourages each of them to express their perspectives and draw upon their unique experiences to solve complex problems. We work diligently to attract, develop, and retain the best people in our industry to strengthen our company legacy and reputation for impact. Our dedicated teams are essential in fulfilling our mission to develop healthy communities, enhance opportunities, and enrich lives. Within our organization, we provide training to ensure that our employees are aware of our policies, guidelines, and procedures that promote a culture of diversity, inclusion and belonging.

Our commitment to diversity, equity, inclusion and anti-racism is at the core of our impact management framework. We track diversity indicators and seek continuous improvement across the company, as well as within our supply chain partners and vendors. As part of our endeavor to continuously improve, the Anti-Racism Committee was established in 2020 and actively sets organizational priorities under three pillars of focus: internal, external and community level.

Diversity & Inclusion at Rose Companies1

OUR WELL-BEING

We seek to create a company in which our staff, residents, neighbors, and partners thrive with a sense of purpose, and enjoy happiness and well-being. We believe these aspects of a well-rounded company can only be achieved by empowering our employees and communities to reach their greatest potential across all pillars of life. To promote and encourage healthy living and smart investment amongst our employees, we offer a competitive compensation and benefits package, which includes a tiered medical benefits program, alongside company-paid dental and vision care, disability care, and life insurance. We also offer an employee assistance program, commuter benefits, a 401(k) plan, and a robust profit-sharing program. To attract and retain our top-tier talent, we promote a culture of continuous improvement in our employees and offer a variety of professional development opportunities including tuition reimbursement programs, continuing education, nationwide conference access and more.

OUR ENGAGEMENT

Our commitment to enhancing the common good starts with the work we do day-to-day and extends to service opportunities held at our communities and in their neighborhoods. RoseServe, the annual Jonathan Rose Companies employee service day, consists of all corporate staff members traveling to several communities and aiding in a variety of resident engagement programs and construction projects. Several projects have included building a new playground for a family-oriented community in New Jersey, building a set of community gardening boxes in New York City, and distributing healthy cleaning supplies to residents in Ohio.

In 2020 the company launched a charitable giving benefit for all employees using the technology platform CharityVest, which creates a personal tax-deductible charitable giving fund to provide donation access to over 1.4 million charities across the U.S. As a part of this program, Jonathan Rose Companies has committed to one-forone donation-matching up to $500 per employee each year. In 2022, the company has made over 200 donations totaling over $33,000 to various charities across the country.

2022

Anti-Racism Committee Achievements

• Implemented a suite of company-wide anti-racism trainings, highlighted by a presentation by The Color of Law: "A Forgotten History of How Our Government Segregated America," Richard Rothstein.

• Diversified our corporate advisory board.

• Expanded digital connectivity in our communities.

Partnering for Impact

We have long worked to achieve a variety of material social and environmental objectives through our investment in the affordable housing sector. Though we operate only in the United States, we recognize our position as a member of the global community as well as the global nature of the climate change crisis. To understand our contribution to global goals, we have mapped our actions and investments against the United Nations’ Sustainable Development Goals (SDGs), a set of seventeen goals to promote social, economic, and sustainable development worldwide. As part of Jonathan Rose Companies’ commitment to create tangible, and scalable impact that extends beyond the communities where we operate, we have identified six that are materially relevant to our organization. Importantly, Goal 17 relates to partnership and the promotion and sharing of knowledge, lessons, and impact. We are proud of the many partnerships and strategic relationships we engage in to set public commitments, share best practices, learn from peers, and report and promote our impact achievements.

The Community Opportunity Fund (COF) was awarded a contract through the Fannie Mae Sustainable Communities Innovation Challenge: Healthy Affordable Housing in May 2019, and then an extension contract in August 2021 to deliver the Telehealth Intervention Programs (TIPs) at Grace West Manor, a 429-unit Section 8 senior and family property, in Newark, NJ, owned and managed by Jonathan Rose Companies.

In 2023, Jonathan Rose Companies was selected as a winner in New York State’s Buildings of Excellence Competition for its plan to build an all-electric, Passive House certified affordable senior housing building in Bay Ridge, Brooklyn. The proposed new development will be constructed on a portion of the underutilized parking lot at Shore Hill Apartments, which was acquired by Jonathan Rose Companies in 2018, and will add 137 units of affordable senior housing to the community.

About This Report

This is Jonathan Rose Companies 2022 annual Impact Report, preceded by our Environmental Sustainability reports. Unless otherwise stated, all performance data is reported for calendar year ending December 31, 2021. Like-for-like performance metrics included in the report have been externally verified by CodeGreen Solutions.

To provide feedback or request additional information, please email:

Lauren Zullo Director of Environmental Impact lzullo@rosecompanies.com

For more information, please visit: www.rosecompanies.com

551 Fifth Avenue, 23rd Floor, New York, NY 10176

917.542.3600

www.rosecompanies.com

Disclosures

This Impact Report (the “Report”) prepared by Jonathan Rose Companies (the “Company”) is provided for informational or educational purposes. A reader of the Report may not rely on this material as the basis upon which to make an investment decision. This material does not purport to be complete on any topic addressed. The Report does not constitute a solicitation in any jurisdiction. Moreover, this Report neither constitutes an offer to enter into an investment agreement with the recipient nor an invitation to respond to it by making an offer to enter into an investment agreement. Any potential investment managed by the Company, or its affiliates, will be suitable only for certain financially sophisticated and qualified investors who meet certain eligibility requirements.

The Report is not intended to provide, and should not be relied upon, for tax, legal, accounting, or investment advice. Individuals should make their own investigations and evaluations of the information contained herein and consult their own attorney, business adviser, and tax adviser as to legal, business, tax, and related matters concerning the information in this Report.

The properties appearing throughout this Report are representative properties related to certain of the Company’s activities. Information about such properties is provided for informational purposes only. There can be no assurance that the Company or an affiliate of the Company will invest in or manage similar properties.

This Report may contain “forward-looking” information that is not purely historical in nature. Such information may include, among other things, projections, forecasts, estimates of expense savings, and proposed or expected activities. Moreover, certain historical performance information has been included in this material and such performance information is presented by way of example only. No representation is made that the performance presented will be achieved by any current or future projects or investments, or that every assumption made in achieving, calculating or presenting either the forward-looking information or the historical performance information herein has been considered or stated in preparing this material. Any changes to assumptions that may have been made in preparing this Report could have a material impact on the performance that is presented herein by way of example.

This Report is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The information and opinions contained in this Report are derived from proprietary and non-proprietary sources deemed by the Company to be reliable, and not necessarily all-inclusive and are not guaranteed as to accuracy. There is no guarantee that any forecasts made will come to pass. Any properties named within this Report may not necessarily be held in any funds or accounts managed by the Company or any affiliate of the Company. Reliance upon information in this Report is at the sole discretion of the reader.

The investment strategy employed by the Company and/or its affiliates involves the purchase and development of land and real estate. Thus, any portfolio that employs this strategy may experience more volatility and be exposed to greater risk than a more diversified investment portfolio. Real estate investments are subject to the risks incident to the development, ownership, and operation of real estate, including, among other things: (i) local real estate and financial conditions; (ii) risks due to dependence on cash flow; (iii) changes in availability of financing at attractive pricing; (iv) changes in tax, real estate, environmental and zoning laws and regulations; (v) natural disasters; and (vi) the ability of the sponsor to manage the properties and service providers. The characteristics of any future projects or investments may vary from the characteristics of those shown herein and may not have comparable risks and returns. A project or an investment made by the Company on behalf of its clients is speculative and involves significant risks, including loss of the entire investment.

Past performance may not be indicative of future results. The reader should not rely upon the historical data referred to in any of the case studies in making any investment decision. It has not been audited or otherwise verified by any outside party and should not be construed as representative of the investment experience or returns that may be achieved in the future by the Company.

GRI Standards Content Index

DISCLOSURE NUMBER

DISCLOSURE TITLE

GRI 300: Environmental

302-1 Energy consumption within the organization

302-3 Energy intensity

302-4 Reduction of energy consumption

303-1 Water Withdrawal by source

305-1 Direct (Scope 1) GHG emissions

305-2 Energy indirect (Scope 2) GHG emissions

305-5 Reduction of GHG emissions

GRI 400: Social

401-2 Benefits provided to full-time employees that are not provided to temporary or part-time employees

404-3 Percentage of employees receiving regular performance and career development reviews

405-1 Diversity of governance bodies and employees

413-1 Operations with local community engagement, impact assessments, and development programs

DISCLOSURES

Environmental Performance

Environmental Performance

Environmental Performance

Environmental Performance

Environmental Performance

Environmental Performance

Environmental Performance

Who We Are

Who We Are

Who We Are

Who We Are

TCFD Disclosures

TCFD DISCLOSURES REFERENCE/LOCATION

Governance: Disclosure the Organization’s Governance around climate-related risks and opportunities

a) Describe the board’s oversight of climate-related risks and opportunities

Jonathan F.P. Rose, who is the President and Founding Partner of the company, serves as the senior decision maker on climate-related risks, opportunities, and issues. Mr. Rose and Partners receive quarterly reports detailing portfolio and asset-level performance on ESG topics. In addition, Jonathan Rose Companies conducts annual meetings with the Management Committee about sustainability performance including GRESB results, identified risks and opportunities related to climate, and the ESG progream in general to discuss upcoming priorities. Annual reporting covers updates on long-term strategic objectivs, updates and notification regarding regulatory changes, and updates regarding proposed actions to improve the performance of the assets.

b) Describe management’s role in assessing and managing climate-related risks and opportunities

At Jonathan Rose Companies, we assess risk from the very earliest stages and incorporate investment and operational strategies to mitigate risk and enable continuous, safe operations across our entire portfolio and within each business practice. We actively focus our investments in economically resilient markets and, when possible, aim to acquire properties and locate new development projects in areas with limited exposure to current and future climate hazards. Our investment strategy applies basic real estate principles to increase value, while taking advantage of our competitive position in the market and our sophisticated partnership and debt structures to add value. Our business strategy is designed to deliver social and environmental impact as well as competitive, risk-adjusted market returns in our asset class. In alignment with this strategy, resiliency is incorporated into all business practices: New Development, Acquisitions, Asset Management and Operations, and Investor Relations. Annually, members representing each of these groups convene as the Risk & Resilience Committee for a company-wide evaluation of resiliency strategies, sharing lessons learned, and determining strategy for the coming year. To help lessen our demand for natural resources and improve the health and safety of our residents, Jonathan Rose Companies invests in the energy efficiency, water conservation and resilience of our buildings, in turn mitigating climate change and reducing our operating costs. These strategies provide economic resilience and add value to our properties, strengthening our financial returns and allowing us to ultimately deploy more capital to achieve even deeper impact.

Strategy: Disclose the actual and potential impacts of climate-related risks and opportunities on the organization’s businesses, strategy, and financial planning where such information is material

a) Describe the climate-related risks and opportunities the organization has identified over the short, medium, and long term.

Jonathan Rose Companies has identified a number of phsycial, transitional, and social risks including:

- Enhancing emissions-reporting obligations (short to medium term)

- Costs to transition to lower emissions technology (medium to long term)

- Acute hazards such as severe storms and flooding (short term)

- Chronic stressors such as drought, heat, and rising sea levels (long term)

- Potential shifts in consumer behavior (long term)

However, Jonathan Rose also views the risks posed by climate change as opportunities to improve efficiency, planning, and resiliency of our assets. Opportunities include incorporating design for the future energy grid and decarbonization which will make our assets more competitive and resilient for tenants and investors, designing space for social cohesion which will foster community connectedness and identify local partnerships to enhance our placement in the communities in which we operate as well as the value to our tenants, and maintaing our position as a leader in the industry.

b) Describe the impact of climaterelated risks and opportunities on the organization’s businesses, strategy, and financial planning.

Impacts of climate-related risks include:

- Capital investments in technology developments

- Costs to adopt/deploy new practices and processes

- Abrupt and unexpected shifts in energy costs

- Increased operating costs from fines and/or government requirements

TCFD DISCLOSURES REFERENCE/LOCATION

c) Describe the resilience of the organization’s stratregy and financial planning

Resiliency is incorporated into all business practices: New Development, Acquisitions, Asset Management and Operations, and Investor Relations. Annually, members representing each of these groups convene as the Resiliency Committee for a company-wide evaluation of resiliency strategies, sharing lessons learned, and determining strategy for the coming year. As we evaluate potential properties for acquisition, we consider the likely risks for a property based on its location, such as flood, earthquake, extreme storms, or tornados. We do not invest in properties with severe, imminent risk, such as those located in a flood plain unless the property has sufficient existing or planned infrastructure to sustain operations. However, some risks are so widespread within a market that they are somewhat unavoidable – such as earthquake risk in California or tornado risk in the Midwest. In these locations, we evaluate building construction type, condition, and structural integrity for resilience against the local risks and will only move forward with properties that are well suited to withstand severe events. In our deal underwriting, we include budget for capital improvements to enhance the resiliency of projects. For example, if a property does not have an emergency generator, we will underwrite the investment to include installation of a generator.

We manage funds with a strong focus on social and environmental impact, and we have spent years developing our approach to resiliency planning and investment, which reduces risk to our investors and makes our communities stronger. The environmental and social focus of our firm enhance our portfolio’s resiliency because energy-efficient buildings are inherently safer in extreme climate conditions and the social cohesion spurred on by resident engagement and social programming creates bonds that are crucial to survival of the most vulnerable populations in an emergency. Traditional communication with investors about resiliency may begin and end with investment criteria: “how much risk can we tolerate, and thus which properties are suitable for investment?”

However, fund managers with a focus on sustainability and resiliency like Jonathan Rose Companies are concerned with the long-term performance of properties, and continually assess, improve, and monitor properties to optimize financial, environmental, and social impact. Tools like GRESB have long been an important means of communication between managers and investors – allowing outside parties to see environmental, social and governance indicators through the lens of a neutral third party. As the real estate industry evolves and responsible investment increases, GRESB has responded by adding modules related to health and well-being, and risk and resiliency. Jonathan Rose Companies is proud to have responded to both, which helps us refine our approach by understanding what else industry peers may be doing, and to help shape future GRESB reporting by identifying gaps or opportunities for more transparency.

Risk Management: Disclose how the organization identifies, assesses, and manages climate-related risks

a) Describe the organization’s processes for identifying and assessing climate-related risks.

To future-proof our portfolio, we have developed a resilience policy that addresses three key types of risk: physical, social, and transitional. During due diligence of investment properties and the design of new developments, we undertake a series of assessments and studies to identify and mitigate risk. Jonathan Rose Companies prioritizes transition risks, or risks that assume a market transition to a low-carbon economy, by preparing and actively participating in policy and regulatory design, such as New York City’s Climate Mobilization Act. In anticipation of regulatory risks such as this, we design and budget for our buildings accordingly. For example, in anticipation of organic waste requirements, our infrastructure design incorporates organic waste collection elements. Our buildings also prioritize transition risks by incorporating design for the future energy grid into the construction phase at our assets. We continue to design greener and more resilient buildings, incorporating healthy building materials and sustainable practices into our development and operating strategies. Recognizing the importance of moving away from fossil fuels, we are actively taking steps toward the electrification of our energy sources and are purchasing renewable energy credits and carbon offsets in local markets across the country. Through our green commitments and Rose Solar, we reduce the climate impacts of our communities, and help make them more resilient in the face of climate change.

TCFD Disclosures (Cont.)

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b) Describe the organization’s processes for managing climate-related risks. Risks include transition, physical, and social risks.

Jonathan Rose Companies’ process for identifying, assessing, and managing physical risks starts with assessing the property for current and future risk based on location. We then evaluate the regionally identified climate priorities and design our systems to address them. For our New Development projects, we undertake a series of assessments and studies to identify and mitigate risk. These include conducting regional risk assessments in all our target markets to identify climate scenarios that could jeopardize physical assets. As we evaluate potential properties for acquisition, we consider the likely risks for a property based on its location, such as flood, earthquake, extreme storms, or tornados. We do not invest in properties with severe, imminent risk, such as those located in a flood plain. However, some risks are so widespread that they are somewhat unavoidable – such as earthquake risk in California or tornado risk in the Midwest. In these locations, we evaluate building construction type, condition, and structural integrity for resilience against the local risks and will only move forward with properties that are well suited to withstand severe events. In our deal underwriting, we include budget for capital improvements to enhance the resiliency of projects. For example, if a property does not have an emergency generator we will underwrite the investment to include installation of a generator.

c) Describe how processes for identifying, assessing, and managing climate-related risks are integrated into the organization’s overall risk management. Risks include transition, physical, and social risks.

Jonathan Rose Companies integrates the management of transition risks into overal risk management by preparing and actively participating in policy and regulatory design, such as New York City’s Climate Mobilization Act. Energy and climate regulations in regions and cities where we operate are leveraged as guides for a comprehensive strategy of risk management integration. For example, we evaluate our compliance status with legislation related to our carbon footprint and measuring the financial impact of energy and climate legislation by assessing the financial risk of non-compliance with Local Law 97 for our New York City assets, as well as Washington DC’s Building Energy Performance Standards (BEPS) for our assets located in that region. Regarding market risks, we evaluate abrupt or unexpected changes in energy costs and market perceptions by investors and tenants. Technology risks related to capital investments in low-carbon technology are evaluated in conjunction with evaluating innovative technologies to help mitigate risks, including battery storage, renewable energy, lighting and controls, building management systems and equipment.

We integrate management of physical risks into our overall risk management strategy not just at the asset level through rigourous due diligence processes, but also at the portfolio level. Recently, we have conducted a portfolio-wide evaluation of current and future climate risks identified at the cityor county-level. Working with property and facilities staff and our insurance carriers, we evaluate which regional risks are most relevant to each property, assess current preparedness, and make recommendations to improve resiliency. Recommendations include both operational and physical, capital improvements.

• Operational and low-cost improvements include measures such as improving resident communication and strengthening community ties, relocating an evacuation site, or ensuring that the property has proper emergency supplies, like water and a radio, on hand. These changes can be implemented quickly and easily.

• Physical adaptations require capital planning and include measures such as elevating electrical panels or other pieces of critical equipment, adding flood-proofing or sump pumps, or adding sources of backup power, among other measures. Fortunately, many adaptation measures that increase the passive survivability of a building align with improvement we already typically make for energy efficiency improvements, such as improving wall and roof insulation or installing energy-efficient windows. Risk and resiliency assessments are then incorporated into capital planning for each property and are evaluated alongside other resources such as energy audits and property condition reports to inform the 5-year capital expense budget. Importantly, resiliency can be improved as part of typical improvements – not simply as stand-alone projects.

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Metrics and Targets: Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities where such information is material

a) Disclose the metrics used by the organization to assess climate-related risks and opportunities in line with its strategy and risk management process.

Properties are assessed and scored on an asset-by-asseet basis against 14 hazard categories which are broken into “acute hazard” and “chronic stressor” category as follows:

Acute Hazards:

- Extratropical Storm

- Flash Flood

- Hail

- River Flood

- Storm Surge

- Tropical Cyclone

- Severe Winds

Chronic Stressors:

- Drought

- Wildfires

- Heat Stress

- Heavy Rain

- Rising Mean Temperatures

- Rising Sea Levels

- Erosion

In addition, Jonathan Rose designs with regulation in mind. Acquisition Managers and Asset Managers have periodic discussions regarding what new policy or laws are expected to come into effect that could impact the property in the future. Based on these discussions, assets are designed and have budgets for anticipated regulatory changes.

b) Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas (GHG) emissions, and the related risks.

c) Describe the targets used by the organization to manage climate-related risks and opportunities and performance against targets.

In order to reduce our impact on the environment, we have set forth a series of climate change mitigation goals for our portfolio. These mitigation goals aim to reduce the emissions, energy, water use and landfill waste from our properties over time. We establish a baseline for each property and actively work to achieve the goals by implementing improvements and continuously monitoring performance. We strive to achieve the targets at each individual property to contribute to our overall portfolio goals.

- Reduce carbon dioxide equivalent (CO2e) emissions intensity by 20% or more from baseline year.*

- Reduce energy intensity by 20% compared to baseline.

- Reduce water intensity by 15% compared to baseline.

- Increase the amount of waste diverted from landfills by 15% from baseline.

*Baseline for investment properties is defined as the 12-month period immediately preceding acquisition or the first 12-month period for which full utility consumption, demand, and cost data is available. The goal timeline is within 10 years of acquisition. Baseline for new development properties is a comparable energy code-compliant building.