Shareholders, dividends, great fortunes and companies, stock prices and homelessness. At first glance, it seems like an incongruent combination, but the truth is that the formula of social socimis (listed public limited real estate investment companies) is beginning to take root in Spain. At the moment, there are two real estate companies for the homeless. In April, tuTechô became the first social SOCIMI to be listed on the BME Growth index, with a valuation of 28.6 million euros, and an initial price of one euro per share. Before it reached the stock market (although on a stock exchange platform minority and alternative) Primero H, promoted by the Spanish association of socimis (Asocimi) and Hogar Sí, a non-profit entity that works so that no person lives on the streets. This SOCIMI began trading on the Portfolio Stock Exchange market in September 2023 with a price of one euro per share, which implies a valuation of 1.4 million euros. They are impact investments and their objective is twofold. On the one hand, combat homelessness, one of the most serious forms of poverty that perpetuates social exclusion. They do this by purchasing homes that they then rent at affordable prices to social entities that serve people in situations of residential vulnerability and homelessness. On the other hand, these SOCIMIs ensure a return to the shareholder through dividends to guarantee the viability and growth of the project. Dividends much lower than those that any real estate project can provide. “There is no need to be ashamed, the SOCIMI has to be profitable to be able to raise a lot of money, buy a lot of apartments and take in many homeless people,” says Blanca Hernández, president of tuTechô. Today, there is full consensus that housing—and not shelters or improvised or transitional accommodations—is key to unlocking deeper changes, such as access to employment. This social intervention methodology, called housing first, which the European Union is committed to, breaks with the traditional care model and provides disadvantaged people with an individual, stable and independent home. José Manuel Caballol, general director of Hogar Sí, considers that “housing is increasingly a more important factor of exclusion and even more so than employment. It is more difficult to get housing while having a job than the other way around.» Homelessness, which has become the maximum expression of vulnerability, is worsening in Spain, where «only 2.38% of people live in social rental housing, that is, about 432,000″, indicates the Rental Observatory, of the Safe Rental Foundation, which highlights the urgent need to increase the figure to combat this scourge. Social rental programs have serious shortcomings due to the overflow of the system. “The majority of people prefer to opt for financial aid rather than social rent, since they often perceive enormous barriers to benefiting.” Thus, “only 3.7% requested accommodation aid last year,” they reveal in the Rental Observatory. In the last decade, homeless people have grown by 25%, to 28,552 in 2022, according to the INE , which obtains the data by counting the users treated in healthcare centers. The figure is higher, as people in irregular circumstances or who have not received assistance do not appear in official records. In Spain there are about 37,000 homeless people, according to Hogar Sí estimates. “The public measures adopted over the years have not finished generating a structural solution. Understanding between the third sector and the real estate sector is much more than necessary,” says Javier Basagoiti, president of Asocimi. Homelessness increasingly affects more profiles. It is not just the person who lives outdoors, in shelters or shacks. It is also someone who lives under the threat of eviction, violence by a partner or family or in unsanitary conditions, severe overcrowding or in a degraded environment (lack of water, odors, dirt, no access). 18% of homeless people blame the lease, either for the inability to pay the rent (9.95%), an eviction (6.58%) or the end of the contract (1.86%), according to the Rental Observatory. Blanca Hernández, who is also president of the Ebro Foods Foundation, founder of the investment firm Magallanes and director of Ebro Foods and PharmaMar, believes that “impact investment is a business model that can end homelessness” . And he continues: “We see that people in a situation of severe exclusion have been able to get out of there when a social entity accompanies them and works with them from a home, which dignifies them, gives them stability.” tuTechô, which has as shareholders the Azora real estate agency, the Renta 4 bank, the private bank Tressis, Magallanes and individuals such as the Martínez-Cosentino family, Hernández (Ebro Foods) and María Herrero (wife of Juan March), among others, have purchased 250 apartments, the average price of which It is between 100,000 and 120,000 euros. They house about a thousand people and have already managed to make 160 autonomous. The time they stay in these apartments is very variable, there is no maximum and in some cases it takes years. “Now we are preparing a capital increase; The goal is to reach around 40 million and continue growing,” says Hernández. The average rent is 600 euros per month, 30% below the market price. Those who rent these apartments to tuTechô are 58 social entities and many of them have public subsidies. For this first year, Hernández calculates a dividend yield close to 2% (over the IPO price). “We are already benefiting.” In the medium term they hope to be able to reach between 2% and 3%.
Pioneering initiative
But the pioneer, the first social socimi for the homeless that was created in Spain, was Primero H. “It is an innovative and pioneering initiative in Spain with successful precedents in other countries such as Australia or the United Kingdom,” says Basagoiti. It has 12 homes in its portfolio, all of them located in Madrid. “We are looking in Mallorca, Barcelona…They are apartments dispersed in community environments, we are still a small initiative,” says José Manuel Caballol, general director of Hogar Sí. The rental price is the one included in the rental reference price index of the apartment. Ministry of Housing, “that is, the rent is between 30% and 40% lower than the market,” says Caballol. This rent is paid by the Hogar Sí foundation, which has between 300 and 400 homes rented at market prices and which hopes to replace them with the apartments purchased by the SOCIMI. In the last year, this non-profit entity has managed to enable 92 people to be self-employed in a residential alternative chosen and maintained by them. The objective of the REIT is to invest five million euros in the first three years. “It aims to obtain a sustainable return in two aspects: the social one, through the eradication of homelessness, and the economic one, through obtaining a return for its investors that is at least equal to the capital invested,” he comments. the president of Asocimi. Primero H has private and institutional investors, among which Inbest, Vitruvio Real Estate or Quonia stand out. Follow all the information on Economy and Business on Facebook and xor in our weekly newsletter