Headingley Development Trust (HDT) was founded in 2005 by residents of the Leeds suburb. It quickly gained membership, with around 800 by early 2009. As an Industrial and Provident Society for the Benefit of the Community, membership is open to all; members have one vote and are eligible to stand for committee.
HDT has established a number of new additions for Headingley, not least a new farmers’ market and a scheme to bring houses in Headingley (where 60% are owned by private landlords for student lettings) into community ownership.

HDT stands out, however, as a development trust that has raised finance through community share issues. HDT led a community buy-out of Natural Food Store (see separate case study) and raised capital for the transfer of a closed school into community ownership.

The trust began negotiations with Leeds City Council in 2006 to bring the former Headingley Primary School into community ownership and develop it into an enterprise, arts and community centre. It was agreed in March 2009 that the centre, called HEART, would be transferred into community ownership – it will provide meeting and performance space for residents and organisations, and a new centre for local people wishing to start a business without having to spend a great deal on overheads.

The first share issue took place in summer 2007, and within the space of six weeks raised £50,000 from Headingley residents. In early 2008 HDT undertook a second share issue, raising a further £55,000.
For each share issue, members were asked to invest a minimum of £100, with some investing as much as £8,000. In total 291 members have invested in HDT so far, to raise this £105,000.

HDT put out a prospectus for the share issue, although its aim of raising money was aided by having a membership of nearly 800 members – a ready-made group of potential investors. HDT also used its stall at the busy monthly farmers’ market to promote the share issue, making it easy for people to find out how the work was developing and sign up.

As Lesley Jeffries, a director of HDT points out, though, “community investment was part of a bigger strategy. We brought the school into community ownership because of ongoing negotiations with the council, because we had a membership base of nearly 800 in HD – many of whom are active and engaged in letter writing and emailing – and, of course, because these members were willing to invest.”
In fact HDT needed to raise £1.1 million in order to take ownership of the school, so the share capital raised from the community was only a small part of overall financial package needed, with the other money coming from a combination of loans, grants and council funds. But it was nevertheless critical – “the fact that residents were willing to put their money where their mouth is provided leverage,” says Lesley, “showing to the council that there was real support for the project.”
The share issue and transfer of the school into community ownership were not always straightforward. The share issue itself was relatively easy, with the two lots of round £50,000 being raised in just six weeks each, but they were not as successful as the share issue for the Natural Food Store, which raised £100,000 in around six weeks. This HDT attribute to the fact that the shop was a going concern, a profitable, well-known business, whereas HEART was an unknown venture, and therefore a more risky proposition.

And as Lesley explains, one of the hardest parts of the whole project was negotiating with the city council. “Although councillors were very supportive of the scheme [ publicly committing to it and ear-marking £100,000 to HEART at a very early stage], asset transfer is a relatively unknown process and therefore systems were not in place within the council itself to help the process through smoothly.” As such, the transfer took around three years.

The persistence and enterprise of HDT paid off, however, and work will now begin on renovating the school. HEART will be run as a company limited guarantee as a wholly owned subsidiary of HDT, meaning that the community will maintain full democratic control of the centre for years to come.