The MOBA Accelerator is a unique financing instrument for and by MOBA’s novel community-led housing cooperatives in Central, South-Eastern and Eastern Europe (CSEE). It is set up to make their access to the finance required for housing projects more easy, cost-effective and responsive to their specific needs. This is a major feat considering the lack of financing partners in the SCEE region.
These community-led housing developers seek to provide viable and affordable housing in adequacy with household income and savings, labour mobility, the need for integrating work and home, and the increasing diversity of household structures and changing demographics.
What does the Accelerator enable?
The Accelerator provides short-term bridge loans to bring pilot projects through their challenging starting period: the acquisition and construction or reconstruction phase, as well as the period required to get their cash-flow up & running. In providing this, the Accelerator fills the lack of available or affordable long-term project financing that currently blocks the successful initiation of pioneering cooperative projects in the Central, South-Eastern and Eastern European region.
Apart from providing a substantial part of the initial capital needed to get these projects going, it also helps to boost the confidence of other investors so they can come on board with co-financing – for instance, through crowd-investment or other forms of financial participation.
As the Accelerator provides short-term bridge loans (projects will get refinanced when they are sustainable), the capital will fairly quickly flow back to MOBA. This high turnover guarantees that further projects will benefit from this finance pool. Having a portfolio of credible and successful projects strengthens the capacity of MOBA to raise more capital towards their financing in the long run.
Towards what can Accelerator loans be used?
The MOBA Accelerator loans are used by housing initiatives to acquire buildings or construction land and construct or renovate these premises. The Accelerator does not cover costs of staff, studies, plans or consultancy alone – it focuses on the ‘hardware’ of housing projects.
Who can access an Accelerator loan?
The MOBA Accelerator is only accessible to MOBA full members. It takes the form of a business-to-business loan from MOBA Housing SCE (the European Cooperative Society that incorporated MOBA, registered in Croatia) to these members. This guarantees that the capital will benefit those projects that share the MOBA values (non-profit, affordable, community-led and community-owned housing projects). At the same time, their embedding in the MOBA ecosystem makes it much easier to validate project proposals and loan requests. Before a loan is disbursed, the viability of the loan request is thoroughly assessed (business plan, cash-flow plan).
A successful trial in 2021
With the help of cooperative peers (ABZ, Zürich) and the grant scheme of FundAction, during 2021, MOBA has undertaken a trial of the Accelerator. The experience resulting from this has helped us gain a substantial understanding of how to match the financing needs of the housing communities, as well as the protocols and expertise required to start unlocking the full potential of the Accelerator.
Now: building up and building out!
Following the empowering experiences from this initial trial, MOBA is now looking for partners to provide the pool of loan capacity necessary: philanthropic actors, peer cooperative housing allies, as well as actors in the area of social impact or social enterprise investments willing to provide the “patient finance” needed to scale up the Accelerator. This can be in donations or by subscribing to shares in MOBA Housing SCE.
We aim to reach the 1 million euro goal by the end of 2023. If you want to be part of this groundbreaking endeavour, get in touch.