Solid Rock CDC Offers Community Investment Opportunity | News

A A new concept is coming to southeast Colorado Springs, one that will inspire community members to stop “owning,” says Pastor Ben Anderson of the Solid Rock Community Development Corp.

The organization is partnering with Mercy Corps to create a community investment trust in the Southeast. Trusts are a way for low-income people to start investing their money to grow funds for the future.

“We’re focused on three things: affordable housing, business development and improving infrastructure,” Anderson said. “We are currently going to innovate for 80 [affordable housing] units in October. We invest in affordable housing, but at the same time we need to engage our community, and that’s why we have the community investment trust. It is not enough for us to provide affordable housing, because it is rental housing. We want our community to move from sanity to possession.

Community investment trusts are a financial product, an equity offering within the state, said John Haines, executive director of Mercy Corps.

“It’s a low value investment, $10, $15, $25,” he said. “It is in a geographical area prescribed by postcode. The property is retail commercial property that people buy. They redeem the money for the down payment in a property over time as they invest. We have around 250 families involved in our project [in Portland].”

Mercy Corps’ Portland Project purchased a 29,000 square foot strip mall in southeast Portland in 2017. It is currently home to nearly 30 businesses and nonprofits and pays dividends to the community.

“It was really, really successful and we are grateful for the quality of this work during COVID,” Haines said. “It pays, on average, a 9% dividend to investors each year. The share price changes on the basis of a valuation each year. The stock price has fallen from $10, in three years of valuations, to $17.05. It worked very well. We have about 30 businesses and nonprofits in the building, and these really reflect what the community has told us they want and need. It’s a very diverse range of non-profit and for-profit tenants. It’s really become a kind of hub for the neighborhood and a place where we’ve had arts events, a number of health-related events, green landscaping, performances, all kinds of things. It has made the space much more active and investors are very proud of the events and things happening in the building. »

Not only do community investment trusts help residents generate investment income, but they also allow community members to own commercial real estate, which can prevent gentrification and urban blight, two concerns growing in the southeast.

“That’s the goal: to find properties that we can improve, renovate them and multiply the process,” Anderson said.

A recent report from Realtor.com found that 80916 is the No. 1 area in this country for new home sales, a good omen for a real estate-based investment product like a community investment trust.

“The goal is to create real community wealth and community ownership of assets that should belong to the community,” said Anthony Carlson of 6035 Strategies, a consultancy involved in the process. “Allowing the community to own certain properties and to be able to see themselves as someone who eventually owns a property versus someone who still owes someone else rent is really at the heart of this program. .”

In addition to being a low cost investment, the community investment trust would also be low risk.

“It’s protected against downside risk, so investors can withdraw their money at any time with no guaranteed loss,” Haines said. “The only requirement is that you’re 18, live in the neighborhood, and take this course we designed called ‘Moving from Responsibility to Ownership’, and then you’re there. You agree to pay a dollar amount each month. Nobody touches the cash, it goes through an investment portal and a share issue agent that we manage. Our goal is to place people who otherwise don’t invest, don’t understand investing and don’t have the ability to invest in real estate to bring them into this asset class at an affordable level. and protected against loss.

Investors in the southeast project will be a mix of community members and ‘impact investors,’” said James Johnson of Solid Rock CDC. “Portland modeling right now, they need 600 community investors, invested, to buy out the property. We work with other impact investors, which are those people who are like, “Hey, we want to make $200,000 because we understand the impact that can have.

Johnson said Solid Rock’s goal is to have the community investment trust in place by the end of the year.

“We’re looking at, if everything works out, by the end of this year,” he said. “Hopefully by the end of this month we will know for certain about the property, and it will still take us some time to do our due diligence on this, to make sure it makes sense for our investors. impact and community. We are looking to do this within the next 120 days, if not sooner.

Jill E. Washington