A few weeks ago I had the opportunity to attend the Unlocking Assets project group hosted by London Funders, and chaired by Caroline Forster of The Social Investment Business. This is a regular gathering for funders that own and use property for the Voluntary and Community Sector (VCS) or invest in VCS property acquisition and development.
During this session, Antonio Rizzo from Lewisham Council and Darren Taylor from Eco Communities (ECO) spoke about how they managed the transfer of 3 library buildings from the council to ECO. The talk led to some insights about making asset transfers work commercially, while simultaneously delivering social returns:
1. It is possible to create a sustainable proposition in a deprived area. The business models used in areas of deprivation could include delivering employability contracts for organisations such as Job Centre Plus and Housing Associations. These proved to be as sustainable as the business models based on simple rental income available in more affluent areas (e.g. renting out space for yoga classes). It could be argued that through these services there was also an inherently greater ability to generate greater impact in areas of deprivation.
2. An entrepreneurial approach is key. Darren was able to use his company’s ties within the local community to leverage resources and knowledge. As a result, he both realised building improvements substantially more cheaply, but also reinforced the interest that local businesses and residents had in maintaining the asset long-term. He managed to repair the roofs of the three buildings at a fraction of the estimate presented to the Council and engaged residents directly in the performance of the buildings. He shares with his staff critical information like sales targets for products like coffee, rental space and employability contracts, making the objectives of his social enterprise clearly understood. The team, who run multiple businesses and social enterprises out of the spaces, have been quite creative with the types of businesses they started to ensure their survival (e.g. second hand furniture).
3. The value of collaboration and transparency cannot be over-emphasized. The reason this worked so well came down to the council’s will to make the partnership work, and their willingness to be transparent with the condition of the assets. The council transferred the buildings for a nominal yearly rent, with a commitment from ECO to maintain and repair the buildings as necessary. With this, the council provided full survey information before the transfer was agreed on.