Last year, social entrepreneur Eva Riedel, who spent more than 20 years in asset management, raised EUR 4.7m along with Core Property Management to purchase a Copenhagen building.
She was looking for a new home for her association Hellebro to expand the day center to a fully developed package including day center, shelter, office hotel to provide jobs for the young and half-way apartments.
The financial marketing professional located the building in Valby, just outside Copenhagen, through her network and presented Hellebro’s social impact investment project to Core Property Management.
They recognized the potential and decided to purchase the building – without investors.
"Eva Riedel presented the building to us, and we decided to purchase it despite not having investors at hand at the time. We knew that if Eva didn’t manage to get the license she needed to make a shelter for young homeless people, it was still a good investment opportunity," says Director John Bødker from Core Property Management, which manages the property pro bono.
Buy first – then raise money
Having signed the contract, Eva Riedel and Core Property started raising the money.
Riedel went to several coffee meetings with former colleagues from the financial sector and was surprised to find it easier to obtain investments and donations from small investors or investment companies than from major institutional investors.
"Initially, I had coffee meetings with several pension funds, but they all gave me the same message. They would only invest unless if I could guarantee a return of 7-8 percent a year. Some of them even said that they were unable to invest less than EUR 34 million,” says Eva Riedel, adding that she could only guarantee 3-4 percent return.
Then she turned her focus to high-net-worth individuals, smaller asset managers and companies that she knew through her network.
Although the minimum investment was EUR 100,000, Eva Riedel and Core Property Management managed to raise EUR 4.7m in three months, and in February 2018, ‘Ejendomsselskabet Hellebro’ was founded. The real estate investment company is managed pro bono by Core Property Management, and the building is leased to Hellebro on a 10-year contract.
"Our investors not only receive reasonable returns, but they will also act as midwives for a social innovative project, that will make a huge difference to many peoples’ lives," says Riedel.
One of the investors is real estate company NREP.
"At NREP we want to contribute to creating sustainable, livable and inclusive cities, and Hellebro is a great initiative in this regard," says NREP Partner and Co-Founder Rasmus Nørgaard.
Donations from small companies
Today, Eva Riedel still wonders why it was easier to get donations and engage volunteers from smaller companies.
She suspects that some companies and investors find it difficult to figure out exactly how to donate and how to make a difference.
"It isn’t hard to make a difference. Every little helps. Every Monday, we receive meals from Maj Invest’s canteen. Ikano Bank donates money and offers free debt advice to our young homeless. They also donated a large industrial dish washer. Other companies, like Aller Media, donate their leftover food from receptions,” says Eva Riedel, adding that several donations are a result of Eva Riedel’s additional occupation, as a women’s network leader at Mandag Morgen Businesskvinder.
After a EUR 2m renovation project, the building is ready to shelter 30 young homeless people and offer free food, shower, health clinic, clothes and counseling to more than 120 young homeless.
Two sponsors have furnished and decorated a workshop of their own. The international cosmetics company L’Oreal has donated a fully equipped beauty lab and tool manufacturer Wareco has made a state-of-the-art workshop with all kinds of machines and tools.
The Hellebro property also includes an office hotel used by several young homeless people employed to assist tenants.
Read about Eva Riedel's career path and how she went from asset management to Hellbro below.
Career U-turn: From wealthy investment bankers to young homeless people