Economic Model
Take an under-used office in a European city and turn it into mixed-use housing. The local cooperative owns the long-term affordable homes. The “European Housing Coop” funds — and fills, from its continental membership — the mid-term serviced flats and the commercial ground floor. A young, ambitious project can't match century-old coops' rents overnight. But from the beginning, our goal is to offer sustainable housing below the market rent for a new let. Over time, we widen that discount as market rents outpace our cost-linked ones. The surplus from EHC's “engine room” funds the next project in your city — or another lovely city in Europe that's facing a wild housing crisis. Move the levers and see how the economics work out.
One building, in Berlin
Convert one under-used office into a mixed-use building. The permanent affordable homes pay their own way at cost-rent; the engine room — the mid-term serviced flats + the commercial ground floor the EHC funds and fills from its member pool — runs a surplus that funds the Fund's patient capital and the Surplus Pool that funds new EHC buildings. Here's how it pans out; pick a city and a scenario above.
New here? How the model works & key terms
- The building: size, the mix of long-term vs mid-term homes, the commercial floor
- The deal: the Fund's return on patient capital, the EHC platform fee, where the engine-room spare goes
- The money: equity vs debt, public subsidy, the loan stack, resident & coop shares
- What it costs to buy + convert + fit out (the capital stack)
- How it's funded → the yearly debt repayments
- The cost-rent (full cost incl. a thin equity return) → the homes self-fund
- The engine room's surplus, split (Fund return · EHC fee · Surplus Pool)
- The verdict: is the loan bankable at this equity? + how the discount widens over time
- Market rents (new lets · serviced · commercial)
- Construction cost & land value
- Utilities & national median income
- The scenario (Realistic / Optimistic / Stress) shocks these — the “market weather”, held separate from your design
- Engine room — the mid-term serviced flats + commercial ground floor, priced near market; its surplus funds the Fund's capped return, the EHC platform fee and the Surplus Pool that funds new EHC buildings (Replicate).
- Cross-subsidy — the engine room's surplus, redirected: it funds the Fund's return, the EHC platform fee and the Surplus Pool — it doesn't push the rent below cost (the homes self-fund at cost-rent).
- Cost-rent — the long-term homes pay their true cost: running costs, the renewal reserve, loan repayments AND a thin, capped return on the equity that built them. It always covers the building, so it always works out — in a dear-build city it's simply a higher number. The win is the trajectory: cost-rent rises at a slow, fixed rate while market rents climb far faster, so residents get progressively cheaper than the market over time (even if they start at or above it).
- Bankability — DSCR & the equity lever — DSCR = the building's net income ÷ its annual loan repayments; a senior lender wants ≥ 1.25×. LTV/LTC (the loan share, capped ≈ 75–80%) is the flip side. So equity is the lever: more equity → a smaller loan → the DSCR clears its floor AND the cost-rent falls (patient/resident equity is cheaper than debt). Full mechanics: the methodology note inside the full model.
- Market rent — the rent for a new lease signed in this city today (from the curated data), not the average of sitting tenancies. It's the benchmark every discount is measured against.
- Patient capital — long-horizon, low-return impact investment the EHC fronts into the building, then recovers as the building earns and recycles into the next city's project. Not a grant.
- Mid-term / serviced — furnished, flexible, bills-included flats for members on the move (weeks to months).
- Feasible vs viable — feasible: the numbers balance. Viable: a senior lender would also fund the loan at this equity (bankable). What each party gets — both member tiers, the Fund, the EHC, the operator — is a read-out beside the verdict, not an extra gate.
- Mission lock — steward-ownership: the local co-op + the central EHC (a European Cooperative Society) each hold a golden share, so the home can never be sold back to the market or stripped of equity. It's what makes the widening discount permanent.
- Missing middle — households too well-off for social housing but priced out of buying. "Affordable" here means decommodified and secure over a lifetime, not cheapest today.
An affordable, sustainable home — one you can afford today, and still in twenty years. A home you can't be priced out of. And a beautiful place to live that adapts to your life story, even when it takes you to a new city or country.
The gap widens because market rents grow faster than our cost-linked fees (3%/yr vs 1.5%/yr) — an illustrative projection on a single growth rate, not a forecast (see the methodology note).
The step down around year 36 is the building paying off its mortgage. Once the loan clears, those repayments are freed — and 50% of it is handed back to residents as a permanent rent cut (the rest seeds the next cooperative). That's why the fee falls from here, instead of merely rising more slowly.
The core bet
Move the dials that matter most. The homes always pay their full cost-rent, so there's nothing to “solve for” — these levers shape how affordable that cost-rent lands and whether the loan is bankable. The deeper levers are in the full model below. (New to DSCR or cost-rent? Open “New here?” at the top of this tab.)
Who's involved — and how the money moves
Four parties — the Resident Co-Op (owns), the EHC (controls + guards the mission), local operators (build & run) and the EHC Fund (funds) — and two financing engines. Decoupling who owns from who controls from who runs from who funds is what lets a fee-based operator run the building inside a non-speculative lock.
The cooperative owns the “what and why” (control + the mission lock); a mission-aligned, fee-based builder-operator — a local co-op, a non-profit housing association, or an impact-driven developer — provides the “how” (build + run, no speculative upside); and the asset fund + lenders provide the “with what”. EHC ties the network together and earns the recurring fees (running the digital platform in-house). (The exact capital stack — who funds what, on what terms — is in “How it's financed” below; the money-flow map on the EHC at scale tab shows these same four parties as wires.)
The money — cost, financing & the partnership€17,550,450 total · 30% cheaper than new-build · €34k patient capital
What it costs
Where the development capital goes — buying, converting and fitting out the building. (How it's paid for is the capital stack below.)
Total €17,550,450 ≈ €2,340/m² across 7,500 m² gross — construction €1,715/m², ≈12% soft costs and a 10% build contingency, a €628k development margin to the local cooperative, and €636k of capitalised finance during construction.
Land is secured by leasehold — an annual ground rent (an operating cost), so no purchase price sits on the stack. Finance during construction is the capitalised interest on the construction loan the local cooperative arranges; it folds into the term debt at completion — which is why debt service only starts once the building operates. The EHC also takes a one-off €319k origination fee on the stack. VAT is out of scope (recoverable treatment varies by tenure & country).
How it's financed
The capital that buys, converts and fits out this building — stacked by seniority. Senior secured debt at the foot (cheapest, repaid first), at-risk equity above it, any non-repayable grant on top. Hover a layer to see where it comes from and on what terms.
Total project cost €17,550,450 · conversion €1715.0/m² vs new-build €2450.0/m² (30% cheaper) · incl. €275k furnishing for 18 serviced flats · ~2,250 t CO₂e avoided vs new-build.
Two-phase debt: a development bridge carries the build, then permanent debt takes it out once the building stabilises.
Explore the detail
The same building, five ways — its physical form, what makes up each tenant's rent, how it evolves over its life, where the money flows, and what people actually pay.
Inside the building
The same office, re-stacked: temporary landing-pad flats, permanent homes above, a community commons woven between and a shared rooftop on top. Hover or tap a floor to see who lives and works there.
Net €/m² per year, after each floor’s own running cost and debt — what it returns to the funders. The long-term homes return only their capped cost of capital: cost-rent leaves them no profit margin, and that restraint is the affordability. The mid-term and commercial floors return that and a surplus on top — and only that surplus funds the Fund return, the EHC, the reserve and the next building. If a floor ever stopped out-earning a home, there’d be no reason to build it instead of more homes. On top of the figure shown, the mid-term floor sends ~€9/m²·yr in member booking fees to the EHC centre — real income this building-level net doesn’t count.
Mid-term occupancy is derived from the city's EHC member pool (215 members → 36 stays/yr vs 37 capacity).
Who lives here: 7,500 m² gross → 6,250 m² usable (625 m² shared common · 5,625 m² lettable). 121 people live long-term (82 adults + 38 children across 55 homes), and 40 mid-term at any time — with 81 different members passing through the landing-pad units each year. Both tiers are EHC members: the long-term adults hold a home, while the mid-term residents are members from across the network on a mobility stay — already counted in their home project, here on the move — so they don't add to a project's member count, they use it.
About 22% less private floor per person than the city average — compact private homes plus generous shared commons house more people per building, part of what keeps the homes affordable.