What do CEMEX, one of the largest cement manufactures in the world, Terra Nova, a private company in Brazil that negotiates land rights for illegal urban squatters; BRAC, the world's largest NGO; and the Inter-American Development Bank all have in common? They are all powerful organizations that share an uncommon commitment to advancing affordable housing solutions for urban poor populations.
In December 2010, Ashoka in partnership with the Hilti Foundation brought together these and several other organizations tackling affordable housing in various geographies and with varying approaches in Barcelona for a Summit of Global Housing Entrepreneurs. Ashoka advances Hybrid Value Chains (HVCs), operating frameworks and cross sector partnerships that create financial and social value for participants in key sectors such as affordable housing.
Billed as a convening of practitioners and entrepreneurs from various disciplines spanning finance, international development, architecture, real estate, building materials manufacturing and distribution among others, the gathering was decidedly unconventional: no key note addresses or presentations were allowed. Instead, the group met with a specific purpose, to identify a common agenda to advance affordable housing for BoP populations globally.
Barriers to Scaling Affordable Housing Solutions
The group identified four primary barriers that impact the scale of their work, be they initiatives led by private sector manufactures and real estate developers, finance providers, or social sector advocates for housing solutions:
- Access to finance for low-income populations for new homes and home improvements
- Lack of clear title to land in the case of scaling solutions for home improvements, and limited access to contiguous, affordable and title-able land in the case of new home developments
- The lack of collaborative effort among players involved in this sector, particularly the lack of cross-sector collaboration, and finally
- The lack of supportive policy environments to incentivize market based solutions and support scaling efforts.
With consensus that these were the common barriers faced, the group identified and committed to developing the solutions that would, over the next several years, allow them to overcome these barriers.
Envisioning Global Solutions
The group laid the groundwork for creating, among other initiatives, a global fund for affordable housing solutions, and a collaborative innovations lab for housing, envisioned as a real time and online gathering of similarly diverse players attempting to leverage their various core competencies in partnership across the affordable housing value chain.
Additionally, the group established "rules of play" and modus operandi for housing finance solutions and distributors of home improvement solutions that would allow the delivery of complete, packaged solutions (such as a kitchen or bathroom upgrade) for low-income clients, with competitive sourcing from area manufacturers.
The Way Forward
With a commitment from participants to dedicate time and resources to the creation of these solutions, Ashoka plans to develop and seed these initiatives and reconvene the original participants and other players in 2011. For more information on how these initiatives will be rolled out, and the detailed proceedings of the event, please contact Ashoka Full Economic Citizenship (FEC) for a post-event summary and outcomes report. Additionally, in February of 2011, Ashoka in partnership with Hystra, a hybrid strategies consulting firm, will publish a comprehensive study on affordable housing initiatives and their barriers to scale. With a working title of "Access to Housing for the Base of the Pyramid," the report will include detailed recommendations, vetted by participants of the Barcelona Summit, for various stakeholders from finance providers to CSOs and private sector companies on how best to engage in the sector to advance housing for all.