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PRESENTS “Let’s take the

Capital Market HOME

to The People ”

Dr DARIN GUNESEKERAOf

Capital Markets for the Marginalized (CMM)

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Presentation IntroductionMay 2008

This Presentation presents a Developer led Capital Markets based Concept for providing modern quality housing and neighborhood development for persons at low levels of income in growth urban areas.

It is NOT based on State spending but provides PROFIT to the State while relieving it of welfare burdens.

It has is based on regulated markets; NO ROLE for Foreign Donors nor NGOs.

It is based on using Urban Planning tools for economic development.

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A Global Problem From USA to Kenya, London to Colombo: slums &

shanties for low income, local authority deficits, lack of city building sites, affordable housing

Yet Colombo has free trade in materials and USD30 per month wages. Why does London have the same affordable housing problem?

Affordable social housing problems seem independent of housing costs, wage incomes.

Over-all, every year construction efficiency improves but homes are dearer. Why?

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Global Crisis

DonorHousing Loans

Founder On Risk

Decent Housing

Shortage of Over 50% of current stock

SlumsShanties

GrowFaster than Economy

GrowthCity =

Rich get RicherPoor get Poorer

DonorsWorld Bank

Keep People in SlumsThrough

Onsite Upgrade

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The Insight

This is a Stock Exchange Problem We have removed Capital Equity Markets

from the longest gestation private projects (supply of homes)

There is a Malfunction in Planning We have accepted plans where housing is

a luxury output and not where homes for all is a requirement

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The Solution which Follows The need is to “Bring the Capital Market Home

to the People”, ie design the correct Stock Exchange Instrument

The need is to make Planning Market driven; where Social is also Market linked

The best way is to bring these persons into the Property Ladder, Financial asset ownership and so the start of the Middle Class economic way.

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Key -Land Cycle Process.

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

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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 (USD6M) Outside Community Sales (Financial

Return) = SLRs1700M (USD17M) SOCIAL

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

Class Regenerated Neighborhood All Children go to School

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Project Results BEFORE AFTER

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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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THANK YOUPlease Join Our Movements

“Every Community and individuals in it Have the Right to create Equity Capital”

“Every Urban Household has the Right to a Planned Home”

Develop a Project with our help Please contact Darin or CMM staff at

wiroshermes@yahoo.com