Triodos Bank’s Executive Board provides a perspective on the wider world it operates in, its impact and activity in 2017 and its prospects for the future.
Community projects and social housing
In 2017 Triodos Bank and Triodos Investment Management financed 490 community projects (2016: 437), and 170 social housing projects, which directly and indirectly provide accommodation for approximately 94,000 people (2016: 67,000). That is one place to live for every seven customers.
Our vision and activities
Percentage of our loans and funds investments to community projects and social housing
Loans and investments by subsector
Our vision on community projects and social housing
There are many social organisations and charities developing commercially viable approaches to tackling social problems. At the same time, we see a growing number of social entrepreneurs: individuals creating new business models driven by a social motive to serve a specific group in their community or in society, underpinned by the notion of disciplined business management.
Financing the social economy
We see the potential for this emerging ‘Social Economy’ sector to play a positive and significant role alongside the public sector and the conventional business sector to shape our future economies.
Within this sector we focus on relationships with leading social entrepreneurs who can demonstrate that their approach has a clear positive social impact for the communities they serve.
In many cases, social enterprises adapt to major changes in governmental and public sector funding. As such they need to be innovative in how they organise their business so they can deliver the biggest possible social benefit whilst also being economically sustainable.
We are particularly keen to support business models that have the potential to become scalable and increase their impact through growing their business and inspiring others to do the same.
Our activities within social projects include loans to organisations delivering a positive social benefit from community enterprises, fair trade businesses, and social enterprises offering employment to vulnerable or disadvantaged groups, to not-for-profit social purpose companies, and providers of social housing.
What were the reasons for / challenge of the project?
Our apartment building is home to 30 tenants in the Berlin district of Friedrichshain. Gentrification created a divide right through our building – older tenants in untouched flats were living side by side with new tenants in freshly modernised ones. We had little contact with one another; our lives were too different.
But then we found out that our building was to be sold and turned into an investment property. The fear that we could all lose our homes released a sense of solidarity among us. Apartments in our area are seen less and less as homes for people, and more as investments, where tenants, who cannot keep up with escalating prices for living space, are just a hindrance. This results in leases being terminated for entire apartment complexes. Buildings are refurbished as luxury appartments and let to new tenants. People living on low-incomes are driven away. And impoverished pensioners are forced to compete with freelance artists, welfare recipients and single parents for the last remaining space that they can still afford.
We didn't want to be played off against each other, and so decided to take the step to self-administration. We managed to convince our landlord not to sell the building to an investor. Instead– with the help of the Edith Maryon Foundation and Triodos Bank - we bought it ourselves.
Now we live autonomously in our apartment building, within the Mietshäuser Syndikat alliance (apartment building syndicate). We are our own landlord. We use the land on the basis of heritable building rights and are gradually paying our loan back to Triodos Bank using the rental income we pay.
How are you addressing this challenge in your project?
We have found a model that allows all existing tenants to continue living in their homes, whilst also enabling them to have a say in the procedures and changes that will affect the building in the future. These include, for example, precedence given to low-income applicants when flats become available; a disadvantaged group in Berlin's current rental market.
We consider the project to be a successful response to speculation on residential space. We turned our worries about our homes and an anonymous neighbourhood into a community where people have started to talk to each other.
People without extensive financial means can now have a say in how and where they live. We remain an apartment building, but one in which the tenants are in charge. We are both tenants and landlord. We have an interest in a stable financing concept. And we reject the idea that living space should be used to maximize profits. We believe the space should be as useful as possible and offer a high quality of life to all its tenants.
What role does Triodos Bank play for you?
If you embark on a project like ours, you quickly find yourself visiting a lot of banks for loan offers. We were often met with baffled looks from staff who did not want to lend us money.
It is usually relatively easy for investors to get loans due to their equity and the different types of collateral they can offer. The picture is very different for a mixed group of tenants with little income.
So we are very pleased that Triodos Bank Germany looked at our financing plan objectively, developed it with us and ultimately made us a loan. It enabled us to acquire the building via our association in collaboration with Mietshäuser Syndikat and the Edith Maryon Foundation, and transfer it to self-management by the tenants.
It was surreal for us to suddenly be handling the millions of euros needed to buy the property. None of us had ever experienced - or expected to experience - anything like that in our lives. So the support from Triodos Bank and its critical view of the finances were a great help.
What role does the project play in your sector?
We now advise many other apartment building communities in Berlin about how to buy their building and make sure their homes remain affordable in alliance with Mietshäuser Syndikat (or other structures, such as associations).
In this way, we can pass on our knowledge and experience during the purchase process and organising ourselves as tenants. We hope that our initiative can be a kind of role model for others and that more tenants move into self-administration and fight for their housing rights.
What social role does your project play?
Housing should not be a commodity; that's something all the tenants in our building agree on. It sounds a little trite, but simply means that access to affordable housing is a fundamental social right, just like human health or education.
If political power through projects such as our self-managed apartment building can be strengthened, perhaps restrictions could be placed on the exploitation of the property market. Public pressure “from below” from tenants, applying a different logic and different social understanding of how we want to dwell and exist together in urban areas could have a profoundly positive impact.
To what extent do you think that Triodos Bank shares your vision?
We felt supported and knowledgeable thanks to Triodos Bank and its honest commitment to our daring venture. It would be amazing if Triodos Bank decided to support more of this type of solidarity-based project to de-privatise real estate and remove apartment buildings from the speculative market, while guaranteeing housing. Mietshäuser Syndikat and the Edith Maryon Foundation would be ideal partners, if they do.
Our calculations include the number of households with a direct relationship to our finance or investment, or the number of households indirectly financed via housing associations. In this case we equate the number of households with Triodos Bank’s finance as a proportion of the overall finance.
The number of people accommodated is based on an average of 2.5 persons per household.
With the exception of the above we include 100% of the impact when we co-finance a project. If it is not possible to record 100% of the data required, we use conservative estimates.