This document presents a spatial-financial model and test scenarios for collective ownership of industrial land in Somerville, MA. Scenario 1 models a minimum income group with $25,000 annual income per person. It shows positive cash flow and affordable housing costs. Scenario 2 models a maximum expansion group with $50,000 annual income and shows the collective can pay off development costs within 30 years. A third scenario models adding children and balanced savings. The document concludes collective land ownership shows potential to provide affordable and sustainable housing.

1. David Birge
Massachusetts Institute of Technology
dpbirge@mit.edu
Daniel Fink
Massachusetts Institute of Technology
danfink@mit.edu
Kairav Shroff
Massachusetts Institute of Technology
kairavshroff@alum.mit.edu
Potential for Collective Ownership of American Industrial Land
A Necessary but Not Sufficient Condition for Autonomous Society

2. PART 1:
Problem Set-Up
& Main Research
Question
PART 2:
Spatial-Financial Model
& Baseline Scenario
PART 3:
2 Test Scenarios
PART 4:
Conclusions &
Next Steps

3. Pier Aureli describes Carl Schmitt’s conception of the nomos as:
“The relationship between the concreteness of the ‘ground’ and the construction of a
political order....[which] is made manifest in the primary event of land appropriation,
an action that precedes the formation of any geo-political institution such as the
community, the city or the state. The nomos is therefore the basis for all the catego-
ries that define the life of a community such as sovereignty, justice and distribution
of resources.”
-- Pier Aureli (Studio Brief, Diploma 14, 2015 - 2016)
3Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

4. Appropriating and controlling land allows an autonomous groups to do the following:
I. Establish, physically locate, and design the built-form for new institutions it deems
necessary to successfully pursue it’s autonomy.
II. Control over the physical design of housing and landscape, allowing the group to
balance costs with amenities in order to ensure economic and social resilience.
III. Collocation of housing and those institutions which provide collective-scale economic
or metabolic benefits, such as bulk-purchasing, shared services, etc.
IV. Establishment of a “home -base” for the community which simultaneously allows
flexibility of work within the wage-labor system, while recognizing the home and local
neighborhood as the sites of simple day-to-day physical and social reproduction, and
thus as the primary sites, and principal activities, where members can establish a
shared life-world
4Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

5. a
b
d
T
T
Union Square
Plot
41 Inner Belt Rd
295ft x 235ft = ~70,000 SF
Value: $3,500,000
Inner-Belt
Inman Square
North-End
Boston
5Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

6. I. Cheapest land available in most cities. ($76.53 vs. $191.36 in 2009)
II. Large plot sizes which doesn’t limit size of collective. (23,496 ft2
)
III. Good distribution in both inner and outer suburban areas.
WHY INDUSTRIAL LAND?
6Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

7. I. Good data on housing rents, utilities, land uses, and land prices.
II. Relatively young, well-educated population, likely to be interested in shared living.
III. Inner-Belt District
a. Large, continous warehousing and industrial district with roughly 10 million square
feet.
b. Centrally located with good access to transit and town centers.
c. Land is under pressure to be redeveloped, a new vision could force a reassessment.
IV. A good generalizable case-study. If it works here, it will probably work in many other
areas.
WHY SOMERVILLE?
7Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

8. PART 2:
Spatial-Financial Model
& Baseline Scenario
8Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

9. 9Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

10. INCOME+TAXES
CONSUMPTION+TRANSPORT
RENTALINCOME
LAND&DEMO
BUILDINGSPACE
UTILITIES,REPAIR,INSUR.
MORTGAGE&TAXES
SITEWORK
SOFTCOSTS
MONTHLY CASH-FLOW, MINUS HOUSING + CHILDCARE + COLLECTIVE FEES
MONTHLY COST OF HOUSING (ALL FACTORS)
INFLATION
UNEMPLOYMENT
NUMBER OF MEMBERS
LOCATION MULTIPLIER
INVESTMENT RETURNS
YEARS TO RUN MODEL
RHINOGEOMETRY
TRANSPORT & CONSUMPTION COEFF.
AVERAGE INCOME
AVERAGE GROWTH
RENT INCREASE
PLOT COSTS
FLOORS
SHARED SPACE
RENTAL SPACE
RENTAL RATES
LOAN TERMS
DEFEREMENT
+
-
thread 1
global parameters
thread 2
10Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

11. INCOME+TAXES
CONSUMPTION+TRANSPORT
RENTALINCOME
CHILDCARE
PRE-TAXRETIREMENT
PERSONALSAVINGS
COLLECTIVESAVINGS
NETINCOME
LAND&DEMO
BUILDINGSPACE
UTILITIES,REPAIR,INSUR.
MORTGAGE&TAXES
SITEWORK
SOFTCOSTS
INFLATION
UNEMPLOYMENT
NUMBER OF MEMBERS
LOCATION MULTIPLIER
INVESTMENT RETURNS
YEARS TO RUN MODEL
RHINOGEOMETRY
TRANSPORT & CONSUMPTION COEFF.
AVERAGE INCOME
AVERAGE GROWTH
RENT INCREASE
PLOT COSTS
FLOORS
SHARED SPACE
RENTAL SPACE
RENTAL RATES
LOAN TERMS
DEFEREMENT
COLLECTIVE FEES
$ 1,000,000
$ 25,000,000
$ 300,000
+
-
thread 1
global parameters
thread 2
thread 3
11Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

12. Most modules use readily available formulas: for mortgages, compounding interest, and tax
calculations for example. These require relatively simple math, and have been tested against
individual online calculators to verify accuracy. To verify housing costs, we run a simple baseline,
using 2015 data from Somerville.
MODEL VERIFICATION
For release: 10:00 a.m. (EDT), Thursday, September 3, 2015 USDL-15-1696
Technical Information: (202) 691-6900 • CEXInfo@bls.gov • www.bls.gov/cex
Media Contact (202) 691-5902 • PressOffice@bls.gov
CONSUMER EXPENDITURES – 2014
Average expenditures per consumer unit in 2014 were $53,495, a 4.7-percent increase from 2013 levels,
the U.S. Bureau of Labor Statistics reported today. During the same period, the Consumer Price Index
(CPI-U) rose 1.6 percent1
. In 2013, spending decreased 0.7 percent. Average pre-tax income per
consumer unit increased at about the same pace as expenditures, up 4.8 percent from 2013.
Consumer units include families, single persons living alone or sharing a household with others but who
are financially independent, or two or more persons living together who share expenses.
Most major components of household spending increased in 2014, as shown in table A. Many of the
categories with large percentage increases in expenditures rebounded from declines in spending in 2013.
The rise in healthcare expenditures was one of the largest increases among the major components. The
subcomponent for health insurance expenditures increased primarily due to an improvement in the
survey questionnaire. Because of the questionnaire change for health insurance, these estimates are not
strictly comparable to prior years.
Note on health insurance
More consumer units reported expenditures for health insurance in 2014 than in 2013, and because of an
improvement in interview collection methods, higher expenditures were reported. The percent of
households reporting quarterly expenditures on health insurance increased from 65.5 percent in 2013 to
68.0 percent in 2014. The insurance questions were revised from 3-month recall questions to questions
about the amount of the last payment and the payment period.
The new estimates are more accurate because the respondent does not have to calculate a quarterly
estimate—instead the estimate is calculated by BLS, using the amount of the last payment which
respondents are more likely to know. On the basis of cognitive testing, BLS concluded that these new
questions produce better estimates. For those consumer units whose time in sample encompassed
reporting health insurance expenditures using both the old questions and the new questions, the mean
expenditure using the new questions increased by 26.2 percent compared to the old questions. In the
2014 tables, some of the over-the-year change in the healthcare expenditure data, especially in the health
insurance subcomponent, is due to these improvements to the survey questionnaire.
The Greater Boston Housing
Report Card 2015
The Housing Cost Conundrum
Barry Bluestone
James Huessy
Eleanor White
Charles Eisenberg
Tim Davis
with assistance from
William Reyelt
Prepared by
The Kitty and Michael Dukakis Center
for Urban and Regional Policy
Northeastern University
for
The Boston Foundation
Edited by
Rebecca Koepnick
Mary Jo Meisner
Kathleen Clute
The Boston Foundation
U N D E R S T A N D I N G B O S T O N
November 2015
soft co
under
percen
The co
chuset
land-a
of land
more t
ing inf
sanitat
the inf
suppli
suburb
costs,
well . O
but on
There
more e
that ou
period
(TDC)
per sq
by $60
ones . T
9 .5 per
more like $3,215 in Boston—or 52 percent of the gross
income of the median-income household .7
Large multi-family developments, as we will suggest
later in this chapter, are somewhat less expensive to
build on a square-foot basis as a result of economies
of scale . The same is true of larger units with three or
more bedrooms because the most expensive elements
of a unit are the kitchen and bathroom . But even taking
into account somewhat lower development costs per
square foot, today’s cost of development renders home
prices and rents for new housing well outside the
feasible range for most working and middle-income
households in Greater Boston .
The Cost Components of
New Housing
The data we obtained for this analysis provides infor-
mation on the average costs for each major compo-
nent of housing development . For urban projects in
Massachusetts, this information is found in Figure 4.2 .
Of the total $273 .59 development cost per square foot,
land acquisition runs about $41 per square foot, or
about 15 percent of the total . Site preparation costs are
another $8 .32 a square foot, or about 3 percent of the
total . Construction costs, including labor and materials,
account for just over half (58 percent) of total devel-
$40.88
$8.32
$159.04
$29.20
$19.17
$16.97
Construction Costs
Soft Costs
Financing Costs
Developer Fee
Land Acquisition
Site Costs
Total
Development Cost
$273.59
FIGURE 4 .2
Total Housing Development Costs
Per Square Foot by Cost Component,
Massachusetts Urban Projects, 2011–2015
Source: Dukakis Center Housing Cost Analysis
$21
$
Ma
12Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

13. Assuming 1 person per bedroom:
Avgerage Space Per Person = 572.5
Average Rent & Utilities = $1,283
Average Rent & Utilities Per SF = $2.36
13Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

14. SPACE PER PERSON
COST PER SF
COST PER PERSON
14Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

15. 15Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
PART 3:
2 Test Scenarios

16. 16Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
235 feet
Floor height: 15’
Floors: 7
Total Area: 238,938 ft2
Members: 850
Scenario 2 - Maximum Expansion
295 feet
Floor height: 12’
Floors: 7
Total Area: 146,776 ft
Members: 275
Scenario 1 - Minimum Income
2
Floor height: 12’
Floors: 7
Total Area: 262,381 ft 2
Members: 460
Scenario 3 - Economic Co-housing

17. 17Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
SCENARIO 1: MINIMUM INCOME GROUP
INCOME
COLLECTIVE SAVINGS
MEMBERS
RENTAL SPACE
CONSTRUCTION COST PER SF
MORTGAGE TERMS
$25,000 [$20,800 is minimum wage]
25% Consumable, 35% Transportation
275 --> 400 SF per person
12,000 SF
$280 SF [Override based on historic data]
60 years @ 2.75% [HUD, below market rate]

18. 18Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

19. 19Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

20. 20Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

21. 21Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
CHILDCARE
PRE-TAXRETIREMENT
PERSONALSAVINGS
COLLECTIVESAVINGS
NETINCOME/MONTH
MEMBER CASH-FLOW
RENTAL + REMAINING PAY
PRE-TAX RETIREMENT
TOTAL HOUSING COSTS
COLLECTIVE CASH-FLOW
$1,190,000
$273
$107
$1,043
$90
$680
$7,590
$19,000,000
$300,000
+
-
-COLLECTIVE FEES
40
YRS
SCENARIO 1: OUTPUT PARAMETERS

22. 22Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
SCENARIO 1.2: ADDING 1 CHILD / PER COUPLE
CHILDCARE
PRE-TAXRETIREMENT
PERSONALSAVINGS
COLLECTIVESAVINGS
NETINCOME/MONTH
MEMBER CASH-FLOW
RENTAL + REMAINING PAY
PRE-TAX RETIREMENT
TOTAL HOUSING COSTS
COLLECTIVE CASH-FLOW
$440,000
$273
-$173 $330
$107
$1,043
$90
$680
$7,590
$19,000,000
$300,000
+
-
-COLLECTIVE FEES
$570-$650/YR
40
YRS

23. 23Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
SCENARIO 2: MAXIMUM EXPANSION
INCOME
SHARED SPACE
MEMBERS
MORTGAGE TERMS
$50,000
7,500 SF
850 --> 230 SF per person
30 years @ 8.6% (HUD, below market)

24. 24Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

25. 25Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

26. 26Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff

27. 27Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
CHILDCARE
PRE-TAXRETIREMENT
PERSONALSAVINGS
COLLECTIVESAVINGS
COSTOFDEVELOPMENT
NETINCOME/MONTH
YR1
YR2
YR3
YR4
MEMBER CASH-FLOW
RENTAL + REMAINING PAY
PRE-TAX RETIREMENT
HARD + SOFT COSTS
TOTAL HOUSING COSTS
COLLECTIVE CASH-FLOW
$50,000
$50
$0
$2,156
ALLBUT$50
$611
$1,222,000
$80,892,000
$56,106,000
$34,580,000
$15,986,000
$80,729,000
$0
+
-
-COLLECTIVE FEES
30
YRS
SCENARIO 2: OUTPUT PARAMETERS

28. 28Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
POPULATION GROWTH
years
0
50,000
25,000
100,000
150,000
200,000
population
16
81
27
12
9
8
3
4
243 collectives
20
6,561
32
5.5 million

29. 29Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
SCENARIO 2.2: BALANCED SAVINGS
INCOME
PRE-TAX RETIREMENT
SHARED SPACE
MEMBERS
MORTGAGE TERMS
COLLECTIVE FEE
SAME
5%
SAME
SAME
SAME
All but $50 >>> All but $700

30. 30Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
CHILDCARE
PRE-TAXRETIREMENT
PERSONALSAVINGS
COLLECTIVESAVINGS
COSTOFDEVELOPMENT
NETINCOME/MONTH
YR4
YR5
YR6
YR7
MEMBER CASH-FLOW
RENTAL + REMAINING PAY
PRE-TAX RETIREMENT
HARD + SOFT COSTS
TOTAL HOUSING COSTS
COLLECTIVE CASH-FLOW
$689,000
$700
$216
$2,156
ALLBUT$700
$611
$568,000
$94,400,000
$73,562,000
$55,647,000
$40,349,000
$80,729,000
$313,812
+
-
-COLLECTIVE FEES
30
YRS
SCENARIO 2.2: OUTPUT PARAMETERS

31. 31Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
PART 4:
Conclusions &
Next Steps

32. 32Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
We have shown how our model can be used to simulate a wide range of scenarios, under
differing economic conditions, and over long time-periods. Furthermore, assuming our model
produces results within acceptable margins of error, these scenarios show that collective
housing and purchasing can provide a robust economic model that autonomous societies
can use to appropriate and occupy land. Because the potential financial gains for both
individual members, and the collective institution as a whole, appears so great, it raises the
question as to why more do not exist. The most logical reason for this is that multiple hurdles
present themselves which prevent the initial founding of a collective. These include the effort
required to organize and convince tens or even hundreds of individuals and households to
agree to shared legal and financial terms, the potential need to lobby for rezoning of more
affordable properties, and the more complex mortgage and loan conditions which may
CONCLUSION

33. 33Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
prohibit banks from being willing to lend.
Assuming these early hurdles of organization, zoning, and financing can be overcome,
the answer to our primary research questions is that there is great structural and latent
potential for a collective group of middle and lower-income groups to collectively purchase
land and construct housing for themselves. Moreover, if land is available in appropriate areas
at the necessary timing, we have also shown that a single collective could finance its own
replication fast enough to match an exponentially growing demand. This is a critical point to
make, as it implies the financing of a long genealogy of collectivized housing projects could
theoretically be a singular event, a big-bang so to speak, which expands under its own initial
inertia. This in turn suggests we should be thinking in terms of collective urbanization, and
what that might look like, and not simply isolated, autonomous groups.

34. 34Potential for Collective Ownership of American Industrial Land: Birge, Fink, Shroff
NEXT STEPS
I. Investigate existing type and possibly invent new organizational models that do not
carry the equity burden nor its potential for profit seeking. A rental model may be more
appropriate for large groups.
II. Consider new loan instruments which do not require equity, but rather use human-
capital as the foundation for a new type of risk assessment. This could potentially
be akin to an insurance model whereby with a large enough group, you can assess
statistically meaningful results, even though you don’t know the individual who will be
sick, or who will lose his or her job.
III. Develop arguments that would incentivize municipalities to allow rezoning. The addition
of affordable housing without the city needing to do anything, is a strong case if enough
local residents can join.