Overview

November 24-26, 2014 for the 3rd Connective Cities Dialogue Event to exchange on innovative financial instruments in urban development and housing policy.

Revolving Funds, Microcredits and other innovative financial instruments are relevant in urban development as well as in housing policy. They are of highest concern if no sufficient classical funding is available, where self-help approaches are to be strengthened and where unprofitable real estates are supposed to be brought back to the markets. Local actors from developing and emerging countries were asked to contribute to the Dialogue with their vast experience regarding instruments such as micro-credits, small scale support of housing and further innovative financing instruments.

The Dialogue’s event objective was to provide all participants with good insight to good practices in the field and to invite them on the other hand to contribute to the dialogue with their experience. Based on examples, the practitioners introduced during the workshop, the experts discussed challenges and needs for improving urban financing practice and governance.

Keynotes

Exchange on good practices

The workshop was centred around case studies presented by the participating practitioners on the application of innovative financing solutions. The dialogue event focussed on two particular fields: (i) Community-based practices and financing schemes, that either a) create new markets or b) are supported by the user-involvement both social and economic dimensions. (ii) Institutional approaches that either supplement or pro-long urban development policies.

Results

Innovative financing instruments have to overcome a number of governance and structural boundaries. Both grass-root community projects as well as public institutions in e.g. revolving funds are subjected to external conditions that require reducing transactions costs in terms of (i) educating on the financial innovation theme at stake and (ii) developing projects subjected to external success criteria and structural requirements.

The following themes have been identified as important follow-up themes:

Implementation of revolving funds: How to implement local revolving funds using different kinds of financial resources (local budgets, international donors and others)? What new legislative structures are needed?

Capacity building: Development of expertise in matters of investment management, development of integral approaches for urban practitioners

Information management and user orientation: Development of methods and tools that involve local users and provide insights required for decision analysis

The workshop concluded that innovative financing instruments are subjected to a variety of success factors that only can be addressed by stakeholders that are acting as cross-sector intermediaries: They have to interface between new format of participation through financial instruments as well as provide moderation in community-centred dialogues.

Field trip

Participants had the opportunity to visit the (apartment-house syndicate) project Kunterbunte 19, a co-housing project financed within the Miethäuser Syndikat system. On a larger scale the urban development in Leipzig West and the different Leipzig different participatory housing projects were presented and discussed during the field trips.

Video