Ch 5 - CST Orientation
CST Education Series
Created on September 23, 2024
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Transcript
Back to CST Investor Portal
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Your Journey as a CST Member-Investor
5. Investing in the CST
A steward of the Trust, voting on key decisions of the CST
A shareholder in a Public Benefit Corporation, also known as the CST
An owner of the trust, including all of the properties added to the CST
An investor in a unique, non-extractive community investment vehicle
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An innovator in a community real estate development and community wealth building enterprise
By becoming a CST member-investor, you are becoming...
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CST Investment Features
Here's The Guild's [NAME] to introduce the key features of the CST Investment you should know.
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CST Investment Features
Reserves & Safeguards
CST Investor Education Courses
SEC-Compliant Portal to Facilitate Investment
Limitations, Appropriateness, Ethical Considerations
Two "Classes" of Investor
Accessible Investment, Low-Cost Buy-in
Financial Returns
Voting Power
Quiz
Minimum Holding Period
QUIZ
GG and JJ are neighbors who are becoming investors in the CST. GG makes $42k annually as a nurse tech. GG wants to invest at the level of $25 per month. JJ earns a $90k salary for a film editing company. JJ wants to invest $50 per month.
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QUIZ
GG and JJ are neighbors who are becoming investors in the CST. GG makes $42k annually as a nurse tech. GG wants to invest at the level of $25 per month. JJ earns a $90k salary for a film editing company. JJ wants to invest $50 per month.
Next
QUIZ
GG and JJ are neighbors who are becoming investors in the CST. GG makes $42k annually as a nurse tech. GG wants to invest at the level of $25 per month. JJ earns a $90k salary for a film editing company. JJ wants to invest $50 per month.
Next
QUIZ
GG and JJ are neighbors who are becoming investors in the CST. GG makes $42k annually as a nurse tech. GG wants to invest at the level of $25 per month. JJ earns a $90k salary for a film editing company. JJ wants to invest $50 per month.
Next
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Finance
Diagram
CST
^ Avery walks you through the CST finance diagram.
The MURPH
CST Finance Diagram
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Remember to take breaks to move your body and stay hydrated. 🫶🏾
How the CST Works
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How the CST Works
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Property
Here's a diagram of potential (hypothetical!) income streams and expenses for the Community Stewardship Trust in three years when two properties have been added and are generating rental income (in thousands of dollars). For illustrative purposes only.
CST Hypothetical Budget
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Chapter Five Check
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We will continue exploring what it means to invest in the CST in future chapters. For more on "Investing in the CST" see the CST FAQ
Go to Chapter 6
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Chapter Five Completed
© 2024 by David Ferris and The Guild CC BY-NC-SA 4.0
10. Next Moves to Get Involved
9. Challenges & Opportunities
8. CST and Governance
1. Objectives
6. Preview of the CST Investor Portal
7. CST and Land Development
2. Why Now? The Present Context
CST FAQ
3. Introducing Solidarity Economy
Course Guide
Back to CST Investor Portal
Orientation to the Community Stewardship Trust
Start Chapter 1
Technology Intro
Index - Course Chapters
4. What is the Community Stewardship Trust (CST)?
5. Investing in the CST
Appropriateness
- Especially for long-term locals who care about the neighborhood and community well-being and are willing to engage in governance.
- Suitable for socially conscious investors with a long-term perspective and a willingness to accept modest financial returns.
Ethical Considerations
This model assigns value to:
- Being able to keep rent low.
- Taking housing and land out of speculation.
- Allowing tenants to remain.
- Neighborhood stability.
- Community governance.
- Shared ownership.
Limitations
- Financial returns may be more modest.
- No target returns.
- The success of projects depends on effective governance and community engagement.
- 24,000-square-foot mixed-use development
- 18 permanently affordable apartments
- Neighborhood-focused grocery store
- 3 commercial kitchens
- Event and office space
918 Dill Ave
The CST shares will begin at $10 per share. Local residents can invest as low as $10 per month to become a community investor.
Accessible Investment, Low Dollar Buy-in
Financial Returns
- Investors gain short-term returns when CST votes to use surplus cash flow to issue dividends.
- As properties appreciate over time and pay down debt, CST shares appreciate in value.
- Investors can realize their returns by cashing out their CST shares.
890 Dill Ave.
In December 2023, The Guild acquired 890 Dill Ave. through an investment from our Groundcover capital fund. This was an important milestone in our “block strategy” approach: It gave the Community Stewardship Trust two commercial and mixed-use buildings, plus the open parcels at the critical intersection of Dill Avenue and Sylvan Road. We are currently in the process of incorporating feedback from co-design sessions and key community stakeholders into our plans for the space.
CST Investor Education
- Solidarity Economy
- Community-owned real estate
- Finance and community investment
- Community Governance & Stewardship
Class B Solidarity Investors
Class A Community Investors
Two Investor "Classes"
Earn at or below $81, 680 Minimum 5-year investment period, with priority for redeeming shares after 2 years Earn above $81,680 Minimum 5-year investment period
Minimum Holding Period
The CST is a medium to longer term investment. Community investors will be required to hold their funds for a minimum of 5 years. The CST raises and maintains a cash liquidity reserve that allows residents who earn lower incomes can redeem (cash out) their shares before the minimum holding period. This way the CST functions more like a savings account.
Shares Reserve
Cash Liquidity Reserve
Enables investors to cash out before minimum investment period expires, so CST can function more like a savings account (Class A Investors have priority) For every $1 of equity shares outstanding, we reserve $1 of equity inside the CST.
Reserves & Safeguards
The MURPH
The MURPH is 9,700-square-foot building in Atlanta’s historic West End community. Like many communities with Black cultural roots and institutions, the West End is rapidly gentrifying and losing communally held spaces. The MURPH will build on the community’s abundant legacy and offer affordable, accessible, and well-equipped meeting space. The space includes 10 individual offices, a conference room, a classroom, a large common area, a laundry room, a full kitchen and a 3,400-square-foot warehouse.
Let's VOTE➞
Voting Power
Community investors will have the ability to vote on key decisions such as future tenants, electing board members, or how to allocate surplus revenue for community initiatives or dividends. In these decisions, community investors will have equal voting power, or in other words, it will be 1 person 1 vote.