New rural investment fund is leveraging NMTCs to deploy $45 million for health care, affordable energy and quality jobs

CHICAGO, June 5, 2025 /PRNewswire/ -- A new investment fund is set to fuel health care services, affordable electricity, and good jobs in rural and tribal areas, offering financing that helps address the multiplying impacts of poverty on the well-being of families and communities.

The Morgan Stanley Rural NMTC Fund is leveraging federal New Markets Tax Credits (NMTCs) to invest $45 million in high-impact development projects. A collaboration between Morgan Stanley and Broadstreet Impact Services, the fund will deploy affordable capital to fill critical gaps in rural and tribal communities.

"The fund is designed to fuel economic opportunity and improve overall health in communities that may otherwise struggle to attract the capital they need to build and grow," said Joy Hoffmann, Managing Director with Morgan Stanley, which capitalized the fund. "It is an investment strategy that we hope will have a long-term impact on reducing poverty, helping support rural businesses and community facilities while at the same time helping expand family incomes and wealth."

The fund is focusing on projects being developed in nonmetro census tracts with high rates of unemployment and low median incomes. To qualify for investment, projects will address health care, electrification needs—including solar and other clean energy projects—community services, or workforce development programs and offer jobs that pay a living wage with benefits. Jobs must be accessible to a wide range of workers, including those who might otherwise face employment barriers, like people with disabilities, those without a college degree, and individuals rebounding from long-term unemployment.

All told, the fund is designed to amplify opportunities in rural communities, while addressing persistent challenges. It prioritizes health investments, for example, because hospitals are often the economic drivers of rural communities, with every $1.00 they spend delivering $2.30 in additional economic activity. Hundreds of rural hospitals have either shut their doors or are at risk of doing so, eliminating good-paying jobs and local business income in the process.

"With this fund, we are investing in the economic infrastructure of rural communities and the health of the people who live there," said Brent Kuennen, Senior Vice President of Fund Management with Broadstreet. "Communities need affordable capital to address their critical needs. We structured the fund to provide it."

The fund recently closed its first investment to support two new health facilities in Colusa, Calif., a community of more than 6,400 residents in California's central valley, an hour's drive from Sacramento. The fund provided $8 million of the project's $26.5 million total development cost to renovate an existing local building into a full-service health facility and, at the same time, build a new pediatric health clinic.

Led by the Colusa Indian Community Council (CICC), the new health centers will support more than 28,000 patient visits annually in a community where people often travel as much as 60 miles for care. And, because the investment is backed by NMTCs, the cost of capital is much lower than it would be for a conventional loan, saving CICC $500,000 annually in debt service costs. The sponsor will use the savings to increase the pay of low-wage employees, improve compensation for health providers so they are attracted to work in Colusa and reduce pressure on the operating costs.

"By blending low-cost capital from the fund with conventional debt sources, this project is able to move forward," Broadstreet's Kuennen added. "Without the NMTC financing, it would not be possible."

About Morgan Stanley

Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, wealth management, and investment management services. With offices in 42 countries, the Firm's employees serve clients worldwide including corporations, governments, institutions, and individuals. For further information about Morgan Stanley, please visit www.morganstanley.com.

About Broadstreet Impact Services
Broadstreet is an impact financial services company offering fund administration, advisory, and fund management services. We work with values-aligned investors and fund managers to fuel social, environmental, and economic impact across the country. Our platform supports 52 multi-asset funds, 57 single-asset entities, and $2 billion in capital under administration and management—advancing equity and opportunity alongside financial performance. Over 20 years, we have developed a client base that values our customizable services platform, fund development experience, impact focus, collaborative partnership approach, and deep sector engagement. For more, visit www.broadstreetimpact.com.

Media Contacts:
Susan Siering, Executive Director, Email: susan.siering@morganstanley.com

Broadstreet:
Ariel Hargrave, ahargrave@broadstreetimpact.com

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SOURCE Broadstreet Impact Services