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“I am a Stock Exchange Person,

THE SLUM DWELLER IS MY CUSTOMER”

The Social REIT & THE CAPITAL MARKET

Dr DARIN GUNESEKERA

Capital Markets for the Marginalized (CMM)

All Business has Needs

The lower the scale; the more powerful the Need

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THE SLUM DWELLER IS MY CUSTOMER

We have Obligations and Responsibilities by our Customers

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Global Crisis

Donor Housing Loans

Founder On Risk

Decent Housing

Shortage of Over 50% of current stock

Slums Shanties Grow

Faster than Economy

Growth City =

Rich get Richer Poor get Poorer

Donors World Bank

Keep People in Slums Through

Onsite Upgrade

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UNHABITAT’s Biggest Slum in the World

Kenya - Nairobi - KIBERA or KIBR. It is located on a Tribal Homeland whose demarcation was not finalized by the Colonial Government Commission.

Is this a Planning Issue?5

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Land Cycle Process.(The Observation referred to above)

First vacant or acquired land (Trust 1) 1

Occupied Estates:(Trust 2, 3 of Cycle 2)

2 3

Occupied Estates:(Trust 4..7 of Cycle 3)

4 5 6 7

Land Cycle 1

Land Cycle 2

Land Cycle 3

– projects exchanges new units for vacant possession of old units– New units must be more attractive to encourage the move

Slums occupy 600+sq ft ground cover/ unit; planned units only 110 sq ft

THE REIT

• trusteesdeveloper

Land in -Certs out

Cash in-Certs out

investors

Condo Sales

market

Primary market

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Social Real Estate Investment Trusts - I

TRUST Authority Social

HousingResident

Land

Shares

VacantPossession

Shares

• Start with a compact city area re-development project plan• Existing Social Housing residents approve the plan• This facilitates a Trust market deal between the landowner

(Authority) and social housing residents. • The deal is shown above

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The People’s Stock Exchange

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S-Reits II Trust is financed by investors and home buyers. Shares may convert to

homes

TRUSTInvestors

Cash via Investment

Banks

Shares*

* Includes right to ownership of a specific house / flat

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S-Reits III - A stock exchange

Trade via Investment

Banks *

Shares

Investors(Authority,Individual,

Institutional)

On – goingSTOCK EXCHANGE

Market:

EXCHANGE

EXCHANGE Regulates Information Flow

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RESULT = Pilot Project I■ 675 apartments in first time

ever high rise occupation by slum/ shanty dwellers in “Streets in Sky” design voted for by them.

■ Corresponding 8 sites (4000 persons) in same neighborhood vacated

■ Land/ built space market given to regeneration.

■ (See 5-2)

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Project Results■ FINANCE

■ Total Investment = SLRs600M ■ Outside Community Sales (Financial Return)

= SLRs1700M ■ SOCIAL

■ Self sustaining 675 homes paying rates ■ Lives transformed from Shanty to Middle

Class ■ Regenerated Neighborhood ■ All Children go to School

Financial Returns：Unlocking the Profit in the Land

Investment: SLRs600M (USD6M)

Outside Community Sales (Financial Return): SLRs1700M (USD17M)

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Project Results■ BEFORE AFTER

■ video

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The Past and Present seen by independent video production.(6 years later; long after project period; 5 years after full Condo hand over).

• The Stock Exchange STARTS by turning the searchlight on to REALITY

• Example Benares

• Example Cinnamon

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The LIVING Stock Exchange

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In Benares, India: Constructive Social Action

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Kibera Elders Council’s Social Action for Financing

■ The tribe whose “homeland” is Kibera, called by UNHABITAT the worst and largest Slum in the world. (Nubians of Kenya) meet to get financial advice

•The transformative POWER •Land Prices in Colombo poor areas •Even the two small cases - Money created

•WHO? •Development Bank/ Merchant Bank •Developer/ Construction Company •State Development Program •Citizen Sector Organization •Regulators - CMA/ SEC; Urban Authorities are promoters

•The Stock Exchange is a LIVING SOCIAL INSTITUTION •Must encourage and develop the Business who takes charge (WHO? above)

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The LIVING Stock Exchange Transforms Tomorrow

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• Look for • Queues • The Poorest in large numbers • The Desperate in large numbers

• THEY NEED the LIVING STOCK EXCHANGE

• Forget • Dead Letters, Laws, Regulations • Yesterday’s Ideas

• The Stock Exchange is a LIVING SOCIAL INSTITUTION

• Your Duty is to Find Your Customers from those WHO NEED THE STOCK EXCHANGE

• Go There and Make them Your Customers

• Join our Movement • CAPITAL MARKETS FOR THE MARGINALIZED

• https://darincapitalmarkets.wordpress.com

LIVE The LIVING Stock Exchange