Questions and Answers
- What is the difference between the Syndikat and other models?
- Why is the Syndikat based on the legal form of an LLC (rather than that of a cooperative or a foundation)?
- Does the Syndikat act as a broker for rooms or apartments?
- Does the Syndikat act as a broker for houses?
- What does a group need to do in order to become a project in the Syndikat?
- How much work is involved later on?
- Do tenants have to have money to be able to join a project?
- How much does the counseling cost?
- How much does it cost when the Syndikat acquires an interest in a project?
- How can I collaborate in the Syndikat?
What is the difference between the Syndikat and other models?
A special feature of the Mietshäuser Syndikat lies in its neutralization of property, its decentralized organizational structure of autonomous projects, and in the commitment of older projects, which have already paid off their debts, to provide financial support for new projects.
Why is the Syndikat based on the legal form of an LLC (rather than that of a cooperative or a foundation)?
The Syndikat relies on a model of divided powers. Within the house LLC, there are two subordinate bodies with different interests that mutually monitor each other. Thus, a reprivatization is rendered nearly impossible, since both of these bodies would have to agree to the sale of the house.
Of course, even a cooperative can stipulate in its statutes that living space is to be withdrawn from the capital market. However, with a qualified majority, the members of the cooperative can change the statutes. Since there is no way to prevent this from happening, the cooperative model seemed too ‘insecure’.
In addition, it is important to have autonomous projects which are able to make their own decisions about matters of concern to the respective project (except for the sale of the house) and that will not endanger the other projects in the event of insolvency. This is possible only if each house has an independent legal status. An LLC is ideally suited for this purpose, since it has low ‘maintenance costs’ and is relatively easy to manage: unlike a cooperative, an LLC does not have to be a member of an auditing association that can charge up to 5,000 Euros for an annual audit; moreover, an LLC does not have to have investments approved by an auditing association. An auditing association has to assess whether the investment is profitable. New projects, however, initially generate losses.
A foundation would indeed be a ‘secure’ legal form for the neutralization of property, but would unfortunately only be able to invest its interest income in its specified purpose. Therefore, its assets would have to be invested at high interest rates in order to earn as much money as possible for new projects. The Syndikat, however, wants to place money at the disposal of the projects directly, charging little or no interest. [top]
Does the Syndikat act as a broker for rooms or apartments?
No. The Syndikat does not act as a broker for rooms or apartments. Please contact the individual project(s) for information. Each project is autonomous in this regard. [top]
Does the Syndikat act as a broker for houses?
No. The Syndikat does not act as a real estate broker. Therefore, we are also not interested in any real estate offers by realtors or private persons. [top]
What does a group need to do in order to become a project in the Syndikat?
Contact us by phone, mail, or e-mail to arrange a meeting. A new group will be mentored by an existing Syndikat project in the vicinity, by the Syndikat itself, or both. Subsequently, a concept with a financing plan will be developed. The group will have to present itself at a general meeting (MV), which then decides whether or not the Syndikat should acquire an interest in the project. General meetings take place an average of three times a year at alternating locations.
The following criteria have to be met before a group can present itself at a general meeting:
- membership in the Syndikat association
- a prospective property
- a financing plan and detailed counseling by the Syndikat
- a brief chronology of what has taken place so far and a tentative time schedule of what is to happen in the future [top]
How much work is involved later on?
Self-administration is work. The tenants must do everything that was formerly the responsibility of the landlord: financing plans and loan applications in the start-up phase, construction and renovation work, and later also bookkeeping and house management. [top]
Do tenants have to have money to be able to join a project?
Tenants are not required to give a direct loan to the project. The group of tenants is thus not identical with that of the creditors who have provided direct loans. [top]
How much does the counseling cost?
Nothing. We work on a voluntary basis. Individual groups seeking counseling should contact our office in Freiburg or a project that offers counseling. We gladly provide speakers for information sessions if travel expenses and accommodations are covered. [top]
How much does it cost when the Syndikat acquires an interest in a project?
For the establishment of the house LLC, the new house association has to raise 12,600 Euros for its 51% share of capital stock. The Syndikat provides the remaining 12,400 Euros, making a total of 25,000 Euros that are then available to the house LLC for the purchase of the house.
- The new house association becomes a member of the Syndikat upon depositing a capital contribution of at least 250 Euros.
- The tenants of the new house LLC pay a solidarity contribution that should not be less than 10 cents/square meter of floor space per month, and that increases annually by an amount equal to 0.5% of the rent, excluding utilities.
- The 12,400 Euros provided by the Syndikat are to be ‘paid back’ in the long term by increasing the capital contribution. [top]
How can I collaborate in the Syndikat?
There is a wide range of mostly voluntary work, depending to a great degree on the individual areas of interest. Possible activities are, for example, project counseling and public relations, for which sufficient basic knowledge is needed. This may be acquired by way of an internship in one of the Syndikat projects. [top]