The Social Housing Enterprise, Inc.

The Social Housing Enterprise, Inc. A Circular Economic Framework for Sustainable Affordable Housing Growth Utilizing Blockchain Technology, Crypto assets, and Securitized REITs

Operational Overview Ver. 1.7 Published March 18, 2018

0 © 2018 Social Housing Enterprise, Inc. Contact: [email protected]

Affordable Housing The largest underserved real estate market in the world….

Mortgage Interest Costs The highest fees charged for basic human needs….

Social Innovation Elimination of fees & owner profits to explode affordable housing growth….

Blockchain Technology Housing acquisitions via incentivized sponsor contributions….

Real Estate Equity Share Ownership Securitized REIT share rewards for SoHo crypto asset miners….


Contents

Executive Summary…………………………………………………………….…………………………… 3

The Problem…………………………………………………………………………………………..………… 4

SOHO SHREIT Solution………………………………………….…………………………..……………… 5

The Social Housing Enterprise, Inc.……………………………………………………….…………… 5

SoHo Social Network………………………………………………………………………………………… 6

Crypto Asset Social Mining.…………………………………………….………………………………… 6

Network Member Mining Benefits.……….……………………………………………………..……… 8

SoHo Private Equity SREITs...………………...…………………………….…………….……………… 9

Portfolio Property Offerings……………………………………………………………………..…….… 10

Portfolio Property Acquisitions…………………………………………………………………..……… 11

Portfolio Growth Projections……………………………………………………………………..……… 11

Rental Revenues……………………………………………………………………………………………..… 12

Real Estate Assets………………………………………………………………………………..…….…… 13

REIT Property Management……………………………………………………………………..………. 13

Initial Coin Offering (ICO)..................................................................................................... 13

ROP Three Phase Strategy…………………………………………………………………….…….…… 13

Phase I: Funding………………………………………………………………………………………… 14

Phase II: Network Activities………………………………………………………………………… 14

Phase III: SREIT Operations…..…………..……………………………………………………….. 15

Sustainable For-Profit Social Network Sponsorship Model……………………….………. 17

Crypto-Asset Value…………………………...………………………………………………………….……17

Why SOHO Matters………..……………………………………………………………………………..…… 21

Next Steps…………………………………………………………………………………………………...……22

Glossary of Terms…………………………………………………………………………………………… 23

References……………………………………………………………………………………………………... 27


Executive Summary The Social Housing Enterprise (SOHO) is a for-profit, social welfare corporation specializing in

creation and acquisition of affordable housing supplies for cost-burdened families. SOHO will

utilize a commercial blockchain network, on which a permissioned, side-chain social network

(SoHo) will operate to incentivize SOHO sponsor contributions. Financial backing by

incentivized sponsors will allow SOHO to fund acquisition of residential properties, where

rental rates for each individual property will follow the U.S. Department of Housing & Urban

Development (HUD) established 30% of annual family income affordability threshold.

Housing supply for SOHO acquisitions will come from vacant residential properties within the

U.S.; consisting of 17,550,000 vacant single family homes identified in a second quarter 2017

housing survey by the St. Louis branch of the Federal Reserve Bank (FRED, 2017). Newly

constructed homes will also be added to the SOHO property portfolio through direct purchase

agreements with independent home builders in target markets. SOHO will own, operate, and

manage a private, social housing real estate investment trust (SHREIT) in which SHREIT

portfolio properties will be offered for rent to qualified cost-burdened families.

SOHO sponsors will be handsomely rewarded for contributing to SOHO’s social housing fund.

Those rewards will come in the form of crypto assets mined in a 1:1 ratio with each USD

contributed to the SOHO SHREIT Fund. Participating sponsors will mine crypto assets for their

personal accounts by engaging in daily activities on the SoHo Social Network. The crypto

mining process is integrated into normal social network activities such as posting stories,

music, videos, commenting, sharing, liking, and making new SoHo social network friends.

Mined crypto assets held in network member accounts will accurately reflect each miner’s

individual participation in SoHo social network activities. SoHo will offer crypto holders an

opportunity to exchange their mined crypto assets for equal numbers of equity shares in

securitized SREITs under Regulation A+, Type II of the 2012 American JOBS ACT (SEC, 2015).

Regulation A+, Type II offerings allow anyone in the world, rich or poor, to invest in private

securities up to a maximum annual amount of $50 million for each offering. SREIT

shareholders will receive monthly income from residential rental properties, as well as equity

share ownership in all properties added to each SREIT portfolio. SoHo will add new SREITs in

different geographical locations to keep pace with SoHo social network growth.


The SoHo Social Network Overview The Problem

The U.S. Department of Housing and Urban Development (HUD, 2017) estimates more than 12

million U.S. households, now pay more than 50 percent of their annual income for housing.

HUD further estimates 20.5 million cost burdened families pay more than 30% of their family

income for housing. HUD established 30% of family income as the cost burdened threshold

for housing affordability. That simply means more than 20,500,000 million American families

today can not find affordable housing in communities where they live and work.

Worldwide, the McKinsey Global Institute estimates that “330 million urban households live in

substandard housing or are financially stretched by housing cost” (McKinsey, 2014, p.4). The

United States, European Union, Japan, and Australia combined, account for 60 million

households that are financially stretched by housing costs (McKinsey, 2014, p.4). A study by

the Urban Institute found that in the whole of the U.S. not one single state county can meet

affordable housing demand by low-income families (Leopold et al., 2013).

By 2025, approximately 440 million urban households around the world are expected to

occupy crowded, inadequate, and unsafe housing; or will be financially stretched by high

housing costs (McKinsey, 2014). From a standpoint of societal instability, we are facing a near

term crisis as year after year, less and less affordable housing is made available to growing

numbers of needy families.

Governments around the world are struggling to provide affordable housing to low income

citizen populations. Tax credits granted to housing developers is the most common

government support method to help lower cost of new housing projects. Housing subsidies,

provided by governments to needy families is a second method, but subsidies are greatly

limited due to the growing financial burden taxpayers are forced to carry. Additionally, large

numbers of private and public organizations are actively involved in attracting charitable

contributions to lower affordable housing development costs.

All active methods to increase available supplies of affordable housing are undoubtedly noble

and worth continued pursuit. Unfortunately, current methods to reduce costs and subsidize

housing for needy families, are failing to keep pace with rising affordable housing demand.


Simply stated, no combination of current practices, can be cited to effectively meet the rising

housing needs of low income families worldwide.

SOHO SHREIT Solution

SoHo designed a revolutionary blockchain based social enterprise application, to dynamically

increase affordable housing supplies. In conjunction with established blockchain technology

partners, SoHo will develop an organizational support structure to fuel growth of the SOHO

Social Housing Real Estate Investment Trust (SHREIT). SHREIT properties will be offered for

rent to qualified cost burdened applicant families at the HUD 30% affordability threshold.

Applicant income will be programmably matched to property value following a formulated

protocol that puts each family in a quality home befitting family size, financial budgets, and

geographical locations.

The Social Housing Enterprise, Inc. (SOHO)

SOHO is structured as a for-profit corporate enterprise with an overriding social welfare

mission. SOHO’s board of directors, are committed under articles of incorporation and

corporate bylaws, to acquire quality residential properties to grow the SHREIT portfolio as its

sole social welfare cause. Appropriately, SOHO’s social enterprise mission statement reflects

that sentiment: “A socially responsible entrepreneurial effort, to dynamically increase,

operate, and manage affordable housing supplies worldwide” . Application of revolutionary

blockchain technology is the key operational component that makes SOHO’s corporate social

welfare mission possible.

SOHO was incorporated as a for-profit social enterprise; much the same as Google.Org was

created as a for-profit philanthropic charity in 2006. Google.Org was the first “ for-profit

charitable corporation” in the U.S. (Lim, 2007). A similar for-profit, philanthropic model was

chosen for the SOHO social enterprise, for many of the same reasons Google elected to forgo

the traditional non-profit model for their philanthropic efforts.

Traditional benefits of tax exempt non-profit status, were found to be of insufficient value for

SOHO’s social enterprise mission. As with Google.Org, the constraining burden of IRS federal

regulations for non-profit operating entities are actually counterproductive in the broad scope

of SOHO’s innovative affordable housing model. Allowing government bureaucrats to pick and

choose who qualifies to rent affordable SOHO portfolio homes, under non-profit regulations,

would exclude the greater majority of cost burdened families who SOHO supports.


https://www.google.org/

The nature of a for-profit social enterprise, with a dedicated socially responsible purpose, is

operationally no different than a non-profit operating charity with the same dedicated social

cause. Both entities exist to provide support for targeted markets where operating income is

applied to cover cost of operations, and excess income (profits) are 100% reinvested to

sustain growth and expansion of the social enterprise.

The most obvious difference between the SOHO for-profit enterprise, and nonprofit charities,

is taxable income. SOHO will pay tax on property and profits, where non-profit entities

operate tax free. But those same non-profit corporate entities are burdened with regulatory

strings attached that are not favorable to the majority of current cost burdened families.

Restrictions on how non-profit entities must conduct their business, and who gets excluded

from charitable efforts, pose a greater threat to success of the SOHO Social Enterprise than

federal and state taxes the enterprise is agreeable to pay. SOHO is designed to serve much

greater numbers of cost burdened families than IRS nonprofit regulations allow.

The SoHo Social Network (SoHo)

SOHO needs capital to fund growth of it’s SHREIT residential rental portfolio...more to the

point, SOHO needs “LOTS” of capital to accomplish its corporate mission. That’s where the

SoHo Social Network enters the picture. SoHo is the fundraising arm for SOHO’s affordable

housing operations. How we do that is the stuff that miracles are made of.

SoHo members will socially interact with SoHo friends and family, through web browsers just

as they do today on other internet social networks like Facebook™, Twitter™, and LinkedIn™.

However, that’s where similarities with other social networks end, and unleashed potential of

blockchain technology begins. Below we describe how millions of SoHo social network

members will join together to perfect the art of incentivizing socially responsible acts.

Crypto Asset Social Mining

What makes our proposal stand strong in the face of uninformed disbelievers, is the

application of blockchain technology, and crypto assets to reward what we believe will be

millions of global SOHO contributing sponsors. Socially responsible acts, such as contributing

to SOHO’s social housing fund, will not happen in sufficient numbers unless we can offer a

rock-solid payoff for SOHO contributors. Not only must our reward offering provide reason to

contribute, it must also override all other reasons that vie for a portion of your disposable

income.


As this section title states, SoHo will offer free crypto asset (CA) mining to all network

members. The CA mining process is built into SoHo network member activities. For example:

● If you post a comment on SoHo’s social network, or like a friend’s post, or share a post

etc... you will mine CAs for each specific social act.

● Every social act conducted on the SoHo social network will release CAs for

participating members.

● The quantity and rate of crypto assets mined is determined by the number of CAs

loaded into a member’s mining permit.

● For example: Contribute $100 to the SOHO SHREIT fund, and your mining permit will

be automatically loaded with 100 CAs.

● Visit for a while with your friends and family on SoHo’s social network, and your

mining permit will soon be empty, but your mined CA account will be 100 CAs richer.

Sounds easy...it is. We offer numerous activities where members can mine for crypto assets.

● Permit mining.

○ Posting text, photos, videos.

○ Commenting on posts of friends and family.

○ Liking posts.

○ Sharing posts.

○ Making network friends.

○ Participating in network interest groups.

○ And a host of other interactive social activities

● Property offerings.

○ Residential properties offered by network members to the SOHO property

acquisitions team.

Participating in network activities produces Return On Participation (ROP) crypto results. We

recognize that not every network member will want to mine crypto assets, and that’s OK;

social mining is not required. But for those who do we offer three differ member status levels

that provide opportunity to mine crypto assets at whatever pace members sets for

themselves. Every new SoHo social network member will sign up for the free T1 status level.

Once they get a feel for the network, they can begin mining at the T1 level, or move up to T2

or T3 status to receive various social mining benefits that await them at both levels.


Network Member Mining Benefits

● T1 Benefits: ○ Free access to SoHo Social Network.

■ Sign up for a free personal network account. ■ Crypto mining not required for social network participation.

○ No membership mining fee. ○ Grubstake crypto mining.

■ T3s & T2s pay to load T1 mining permits.

■ T3s receive ⅔ of staked T1 personal mining production.

■ T1s retain ⅓ of their personal mining production. ● T2 Benefits:

○ Free access to SoHo Social Network. ■ Sign up for free personal network account ■ Crypto mining not required for social network participation.

○ T2 annual membership fee. ■ Mining permit loaded with crypto assets equal to T2 member fee.

○ Personal crypto mining. ■ Mining permit loaded equal to SOHO fund contributions.

■ ⅓ of T2 mining production goes to random grubstake accounts. ● T3 Benefits:

○ Free access to SoHo Social Network. ■ Sign up for free personal network account. ■ Crypto mining not required for social network participation.

○ T3 annual membership fee. ■ Mining permit loaded with crypto assets equal to T3 member fee.

○ Personal crypto mining. ■ Mining permit loaded equal to SOHO fund contributions.

○ Grubstaking T1 crypto miners. ■ T3s may elect to grubstake T1 mining permits. ■ T1s split crypto production with grubstaking T3s.

■ T3s receive ⅔ of grubstaked T1 personal mining production.

■ T1s retain ⅓ of personal mining production ■ T1s receive grubstake via random auto-selection.

○ Personal Invitees Crypto Bonus. ■ T3s receive 50 bonus crypto assets added to T1 staking permits

for each personal invitee who upgrades to T3 status. ● Upgrading Status:

○ SoHo network members may upgrade status levels at any time. ○ Upgrade by paying annual new status level membership fee. ○ Mining permits loaded equal to annual upgrade membership fee.


SoHo Private Equity SREITs

SREITs (plural) will be funded by SoHo network members who wish to turn some, or all of

their mined crypto assets into income producing real estate assets. SREITs will be offered for

private investment under Title IV, Regulation A+, Type II of the 2012 American JOBS Act (SEC,

2015) . Regulation A+, Type II securities offerings allow anyone in the world, rich or poor, to

invest in private offerings of U.S. securities up to a maximum annual amount of $50 million for

each offering. SREIT shareholders will receive income from SREIT market rate rental

properties, as well as equity share ownership in all properties added to each SREIT portfolio.

SoHo will add new SREITs in different geographical locations to keep pace with projected

SoHo social network growth.

SOHO crypto assets will be the only transactional instrument accepted for SREIT share

ownership. SREIT equity shareholders will receive monthly rental income from all SREIT

properties. SREIT shares will be valued at a 1:1 crypto asset ratio. Crypto asset external

market value may vary based on market forces.

The resulting future value (FV) for each newly generated crypto asset, will be present day

SREIT market share value, expressed as market value of total crypto assets plus total real

estate value generation produced by SREIT operations. As market value of crypto assets

and/or real estate rise and fall, so too will market value of SREIT shares rise and fall. A

process no different than any other equity REIT venture, with one major exception:

SREIT share value will be a function of crypto asset market value + total

real estate value generation (net asset value + funds from operations);

rather than total real estate value generation alone, which underpins share

value of every other equity REIT venture both public and privately operated.

SREITs will begin purchase of residential real estate properties from the existing pool of

17,550,000 million vacant U.S. homes. Additionally, real estate developers and independent

home builder/manufactures who agree to accept SoHo crypto assets as the transactional

currency, will sell new homes to help grow SREIT portfolios.


SoHo Property Management and SoHo Acquisitions will provide professional management

services to both the SOHO SHREIT and SoHo SREITs. Cost saving advantages of blockchain

technology, which underpins all SOHO enterprise operations, allow reduced fee structures

that conventional REIT management services are unwilling to provide.

SREITs will charge no entry, exit, or transaction fees to SREIT shareholders. Shareholders

wishing to exit their positions may sell or trade those positions at any time of their choosing.

No broker fees or other bundled costs common to private REITs will exist for SREIT

shareholders. SoHo will retain the first right of refusal for all SREIT shareholder sales.

All activities pertaining to SHREIT, SoHo Social Network, and SREIT operations will be

conducted on the common SOHO blockchain enterprise application. Smart contract programs

will be used to automate virtually all operational functions of the greater SOHO Social

Enterprise. SoHo social network activities will sustain growth of the SOHO SHREIT fund. The

SoHo social network is designed as an innovative tool to incentivize social sponsorship to

create and sustain growth of affordable housing supplies for global markets.

Portfolio Property Offerings

The St. Louis branch of the Federal Reserve Bank (FRED) (2017) reported that as of 2nd

quarter 2017, vacant residential housing in the U.S. stands at 17,550,000 empty properties. The

FED’s findings indicate there is no shortage of eligible residential properties that can be

offered for purchase to the SoHo acquisitions team.

Properties added to the SHREIT portfolio will be purchased by the SoHo acquisitions team

using sponsor contributed funds. Prospective portfolio properties can be offered by SoHo

network members who personally own a property for sale, know of someone who does, or

arranges a purchase discussion between a seller and the SoHo acquisitions team. Property

seller’s will acknowledge the offering SoHo member in the purchase agreement. Property

sellers can also offer properties directly to the SoHo acquisitions team if the seller is an

active SoHo network member.

If properties offered to SoHo’s acquisition team result in a finalized purchase, the offering

SoHo member will have successfully mined crypto assets equal to 5% of the property

purchase price. Example: $200,000 * 5% = 10,000 crypto assets..


However, In all cases crypto assets mined from a property offering may not exceed total

crypto assets contained within the offering member’s mining permit. Whenever a situation

occurs where more crypto assets are mined from a property offering than exists in a

member’s mining permit, the excess number of crypto assets will be automatically distributed

to all T1 member mining permits in equal numbers.

Portfolio Property Acquisitions

Portfolio properties will be purchased by the SOHO acquisitions team using SHREIT reserve

funds. A fee simple deed for each newly purchased portfolio property will be singularly owned

by SOHO. Upon settlement of property purchases, and completion of any needed repairs or

renovations, portfolio properties will be placed into rental service managed by the SoHo

property management team.

Portfolio Growth Projections

The growth model for the SHREIT portfolio, projects an initial acquisitions milestone of

100,000 housing units annually. The majority of properties purchased, will be existing homes

and apartments in established communities. Newly constructed housing, that fall within

range of the sq.ft./cost protocol of qualified applicant incomes, will also be added to the

portfolio mix. Housing priced above or below the sq.ft./cost protocol range will be ineligible

for network offerings.

Theoretical limits of residential properties purchased by SOHO rest on four primary factors:

1. Availability of properties

2. Availability of funds

3. Availability of transaction representatives

4. Network throughput

Availability of Properties: Knowledge of 17,550,000 vacant residential properties identified in

the 2017 FED report, gives reason to believe there is adequate vacant housing available to

sustain SHREIT growth projections for decades to come. Secondly, SoHo network members

eager grow their crypto asset mining accounts, will be highly motivated to find and offer

housing to the SoHo Acquisitions team.


Availability of Funds: Adequate funding is directly connected to the number of active

contributing sponsors. In order to grow the social network in proportion to growth projections,

a marketing strategy is being developed to involve celebrity and influential endorsers who

have large fan followings. Those endorsers would publicly support SOHO’s affordable housing

social welfare cause, and challenge their followers to join SoHo’s crowdfunding movement.

Expectations are high that those followers will become active crypto asset miners on the

SoHo Social Network. Endorsers would receive residual compensation from the network, tied

to the success of their efforts to deliver motivated followers, and associated crypto asset

mining production.

Availability of Transaction Representatives: Trained personnel consisting largely of licensed

realtors in target markets will be needed to represent SOHO at property closings. Service

providers will be compensated by SOHO at rates befitting the scope and frequency in which

services are rendered. Such services will in time, be replaced by controlling smart contract

operations. Future change to a smart contract model will occur when real estate related

blockchain vendor services reach a state of market readiness.

Network Throughput: A commercial blockchain network provider will be selected for SOHO

Enterprise operations based on technological design, and transactional throughput that

conforms to a multiple of projected need of the SOHO network at maximally envisioned

operational loads. The bulk of network throughput for SOHO Enterprise daily operations, will

occur on the side-chained enterprise application, developed in conjunction with a blockchain

development team selected for the SOHO social enterprise project.

Rental Revenues

All property related transactions, will be added to the blockchain distributed ledger for

historical tracking of financial accounting, property management, property maintenance,

taxes, insurance, and rental income revenues. Rental clients will be added to respective

property records where monthly payments will be billed and received under agreed terms of a

controlling smart contract program.

Rental revenues from all portfolio properties, will accrue to the SOHO enterprise general

operations fund to pay for budgeted activities. Rental revenue in excess of budgeted amounts

will be transferred into the SHREIT reserve fund following account reconciliations. Zero net

profits will be realized from SHREIT operations.


Real Estate Assets

Ownership and control of SHREIT operations and assets, will be singularly held by the Social

Housing Enterprise, Inc., and its shareholders. SHREIT asset value will accrue to the long

term benefit and interest of the SOHO affordable housing social welfare cause. SREIT

operations will be internally managed by SOHO officers and assignees.

REIT Property Management

The property management role within the SOHO social enterprise, is a critical function to

ensure smooth and effective client relations, and lasting protection of fixed asset value.

Administrative duties relating to setting and collecting rents, finding and screening tenants,

executing rental agreements, budgetary and records management, accounting, taxes,

insurance, and common legal issues will all be relegated to blockchain smart contract control.

Property inspections, maintenance and repairs, market readiness, and ancillary issues related

to given localities, will be assigned to trained SOHO property management agents; many of

whom will also be SoHo network users, and SOHO rental clients living in neighboring

communities. Transactionally monetizing crypto asset value for independent contractor

service fees will become a useful tool that helps to improve lives and foster financial growth

for cost burdened families.

Initial Coin Offering (ICO)

ICOs have become a popular, if somewhat legally controversial, method for startup blockchain

ventures to raise development funds. SOHO will forego that practice in favor of a more

organic, grassroots fundraising methodology. SoHo blockchain enterprise application

development will be funded from SoHo social network operational revenues consisting of

upgrade member fees, advertisement revenue, and SOHO sponsor contributions delivered to

SoHo in the form of an interest bearing program related investment loan.

ROP Three Phase Strategy

The SoHo network rests at the heart of SOHO’s affordable housing social welfare cause. The

permissioned social network will rely on state of the art blockchain technology to accomplish

SOHO organizational goals. As user participation in SoHo activities reaches critical mass,

availability of quality SHREIT affordable housing will dramatically increase in U.S. markets.


Key to the SOHO 30% Solution is active SOHO sponsor participation in SoHo network

activities. Without a network of active SOHO sponsors, there will be no SHREIT portfolio

growth. SOHO sponsors will become the life’s blood of SoHo network operations, and as

such, they must be protected and served in keeping with value they represent to SOHO’s

social enterprise goals. The three phased ROP strategy will ensure that value long term.

Phase I: Funding

Residential property acquisitions by SOHO will require large cash reserves to purchase

multiple properties daily. The SoHo acquisitions team will settle property purchase

transactions in cash using zero mortgage financing. Ongoing SOHO sponsorship will generate

necessary capital to fuel growth of the SOHO SHREIT, and expand operations of the SoHo

social network.

Phase II: Network Activities

The SoHo social network offers opportunity to SOHO sponsors to participate in network

activities for the principal benefit of the SOHO affordable housing social welfare cause.

Network member participation involves crypto asset mining where SOHO contributions

determine numbers of crypto assets permitted to be mine. Permit reloading involves

continued SOHO contributions, all at the personal discretion of each SoHo network miner.


crypto asset production is entirely dependent on each network member’s individual return on

participation goals. There will be no benefit to SoHo network members other than how

members choose to participate in network activities. However, for network users who do

participate, accumulation of mined crypto asset could prove significant over time.

Phase III: SREIT Operations

Public demand to participate and benefit from SoHo network activities, will fuel network

growth, and subsequently portfolio growth, through sponsor contributions to the SOHO

SHREIT fund. Network members holding crypto assets will seek to capitalize on accumulated

asset value relative to total crypto assets owned.

Within the SoHo network, all crypto assets will have zero monetary value by design. Outside

the confines and control of SoHo network use, crypto assets may have monetary value for

crypto asset owners based on open market supply and demand economic forces. Speculation

of market value is common to all instruments of transactional value (including fiat

currencies) . Mined crypto assets can offer tangible value for SoHo network members in the

form of fixed asset real estate acquired with crypto assets in external markets.


To realize open market asset potential for crypto asset owners, all that’s needed are willing

sellers who ascribe monetary value to crypto assets, and agree to an exchange of property in

which crypto assets are traded at fair market value for fee simple ownership of select real

estate properties.

Purchases of real estate property using Bitcoins as the transaction currency, is a new market

phenomenon gaining notable financial attention around the world. Successful Bitcoin real

estate transactions are widely reported in blockchain industry news media. Facilitating large

numbers of real estate purchases using SOHO crypto assets rather than Bitcoin, can be easily

accomplished by pooling crypto assets in SREITs specifically created to reward SoHo crypto

asset owners.


Crypto-Asset Value

Within the SoHo network crypto assets will hold a representative value equal to one (1) U.S.

dollar. For every USD contributed to the SOHO SHREIT fund, one crypto asset will be mined

by a participating SoHo network member. Outside the confines and control of the SoHo

network, market forces may determine crypto asset value to be something quite different.

Mined crypto assets pooled in SREIT share ownership is believed to be a sustainable method

to produce ongoing income and equity share value for SREIT shareholders.


When we look at any instrument of transactional value we commonly check for underlying

fixed assets that supports fair market value. In the case of major fiat currency (money) such

as USD, EUR, CAD, AUD, JPY, CHF.....etc, and crypto assets like Bitcoin, Ether, and others, we

find there are zero underlying assets.

In general terms, the true value of currencies lie in the good intentions of overspending

governments; hands in our pocket politicians; and private individuals who believe that perhaps

one day Bitcoin will rule the financial world. Perhaps one day it will, but for today, naysayers

find little true value in unbacked financial instruments.

SoHo crypto assets have more to offer than unbacked financial instruments? Future value (FV)

home builders, real estate developers, and home sellers receive when they trade real estate

properties for crypto assets of equal present value, can be substantially more than if they

traded for USD.

Let’s examine purchase scenario of a $200,000 new home where crypto asset market value is

$1.00. The SoHo acquisition team trades the home seller 200,000 crypto assets for a new

$200,000 house. The SREIT now owns a $200,000 market valued rental property, and the

seller owns 200,000 crypto assets of equal current market value. Four options sellers can

choose are presented below with accompany details:

Option #1: The seller can exchange crypto assets for USD at market value through any

crypto-exchange where SOHO crypto assets are traded. There are many such crypto

exchanges doing business today, with more to come as around the world new crypto assets

come to market.

The SoHo acquisitions team could exchange crypto assets for USD, and pay the seller in

dollars. However, the FV of crypto assets may have significant impact on the seller’s

decision that options 2, 3, and 4 will clarify.

Option #2: Home sellers can invest some or all of their crypto assets in exchange for SREIT

shares, and become equity shareholders with SOHO sponsors who are investing crypto

assets in SREITs to grow a revenue generating portfolio.

As with other high value crypto assets, there is a valid expectation that over time SoHo

crypto assets will increase in market value. If for no other reason than SoHo crypto assets

are used to purchase the entirety of SREIT portfolio properties.


As each new property enters a SREIT portfolio, the value of underlying real estate assets will

grow in size supporting higher market valuation of SREIT shares, and crypto assets SREIT

management is holding for even more real estate purchases. Crypto assets held by private

owners outside the SREIT environment will also benefit from increased market valuation.

The SoHo acquisitions team will assist home builders to recognize that contracting with a

SREIT to purchase all the homes they can produce, offers a much greater financial

opportunity when looking at FV of real estate backed crypto assets.

Option #3: Sellers may choose to become SOHO sponsors and contribute some or all of

their crypto assets to the SHREIT portfolio fund.

The SoHo acquisitions team will advise sellers on the merits of crypto asset mining, so that

over time they can increase total crypto assets they hold at much faster rates if crypto

asset market value rises from the 1 USD initial baseline price.

Let’s talk about crypto asset current market value. What was Bitcoin current market value

the last time you looked? At the time of this writing Bitcoins are worth approximately

$9,000 each. There is no fundamental difference between a SoHo crypto asset and a Bitcoin,

other than the extremely high cost of mining Bitcoins, and underlying fixed asset real estate

value for SoHo crypto assets.

Bitcoins have zero underlying value; they are only worth what the market says they’re worth.

In open markets SoHo crypto assets will have underlying real estate asset value that grows

as greater numbers of real estate properties are added to SREIT portfolios.

Option #4: The best option for sellers may be to combine options 1, 2, and 3 and profit from

crypto asset FV as a miner, an investor, and home builders getting top dollar for as many

new homes they can construct.

We recognize that crypto assets are not cash, and developers need cash to pay for the high

cost of new home construction. We can address that by looking at what may happen to the

price of crypto assets over time, and how crypto asset FV changes the valuation dynamic of

the entire SOHO Social Enterprise.


Due to underlying fixed asset value of real estate, SoHo crypto assets will hold market value

equal or greater than the associated real estate assets. The greater the number and market

value of real estate properties SREITs purchase, the higher market value of crypto assets

will rise. Principally because free market value of crypto assets is not directly tied to the

market value of the underlying real estate. Real estate acts as a floor for crypto asset

market value….not the ceiling.

Market value of transactional instruments vary based on marketplace bid and ask prices.

Fundamentals aside, why do stocks rise and fall? Why do world currencies (Forex) spike

and fall 24 hours a day. The answer is that people speculate on FV of transactional

instruments. The brighter FV is for any instrument, the more likely current market value will

rise.

Let’s go back to the source of crypto asset generation as mentioned above. SoHo crypto

assets are mined in numbers equal to USD contributed to purchase real estate property. If

a property sells for $200,000 there will be 200,000 crypto assets mined in a 1:1 ratio. That

ratio between purchase price and crypto assets mined will remain fixed within the SoHo

network, regardless of what crypto asset market value is at any given moment external to

the SoHo social network.

The beneficiaries of that fact are people that mine crypto assets, SREIT shareholders, SOHO,

and SOHO contributing sponsors.

Example:

If a crypto asset is worth a dollar, it will buy $1 dollars worth of real estate. If crypto asset

value doubles to $2.00, one (1) crypto asset will buy $2 worth of real estate. Buying a

$200,000 house with $1 crypto assets cost 200,000 crypto assets. Buy that same $200,000

house with $2 crypto assets and it only cost you 100,000 crypto assets. You can purchase

two (2) houses for the price of one at $2 crypto assets valuation.

For every increase in crypto asset market value, more houses can be bought with fewer

crypto assets. That doesn’t happen with fiat currencies like USD. The market value of the

house is tied to USD, not crypto assets. If one transactional instrument can buy twice as

much as a different instrument can buy, people will pay more to hold the higher valued

instrument. That’s why Forex is traded around the clock, traders are betting on currency FV.


Let’s look at how crypto asset FV affects SOHO. The same scenario occurs once again. If

SOHO sponsors or property sellers contribute $2.00 crypto assets to SOHO, the social

enterprise can buy twice as many houses with higher market value crypto assets. The SoHo

acquisitions team may need to convert those crypto assets to cash before individual home

sellers agree to the deal, but that may not always be the case.

The SoHo acquisitions team will also be educating private home sellers on the value of

mining crypto assets, instead of demanding all cash for their home. Some will trade for

crypto assets ...some will accept a cash/crypto mix,...and some will demand cash only.

Consider SOHO sponsors who contribute crypto assets to the SOHO social enterprise. A

sponsor’s mining permit will allow 2X as many utility tokens to be mined for a $2.00 crypto

asset than a $1.00 crypto asset. Higher crypto asset market value rises outside the network,

the more crypto assets network users can mine inside the network.

In this scenario, where crypto assets market value is on the rise, a better strategy might be

to buy SREIT shares with half the crypto assets mined to lock in equity ownership of real

estate assets, then, reinvest the remaining higher valued crypto assets back into mining new

crypto assets at whatever price multiple those same crypto assets have in external markets.

Why SOHO Ma�ers

SOHO’s social welfare mission should matter to people from every walk of life because global

societies are teetering on the edge of unsustainable housing costs for low income

populations. The ongoing failure of world governments to provide affordable access to decent

housing as a basic human need, is a recipe for deeply troubled times ahead.

Financial disparities between social classes today, threaten our ability to provide even the

most basic human needs to deserving populations. We don’t need handouts or government

subsidies, we need free market opportunity that matches our individual ability to provide for

our family’s well being. Spending the majority of what most earn to keep a simple roof over

their heads is not opportunity, it’s a virtual prison that limits our ability to make a better life

possible for ourselves and those who follow in our footsteps.

If we want positive outcomes in life, financial or otherwise, we must look within ourselves

and ask the question...what can I do to make a difference for my family, myself, and my

community. Find a social cause and make it your mission to effect positive outcomes.


The affordable housing crisis is SOHO’s social welfare cause, and with your help we can make

a better life for families in need of positive outcomes. SOHO offers a social welfare solution

that can make socially responsible efforts beneficial to others, and profitable to those of us

who actively participate in SoHo social network activities.

Next Steps

SOHO is exploring all avenues to field the best possible ensemble of industry talent to bring

the SoHo blockchain social network online. We are interested in creating mutually beneficial

relationships with blockchain network providers, enterprise application developers, public

relations specialists, and legal counsel experienced in blockchain startup regulatory

compliance.

We can change the future of the affordable housing industry if we work together to adopt the

most effective model for global expansion efforts. If you are interested in exploring options for

a professional relationship with the Social Housing Enterprise, please contact me at

[email protected]. I will promptly respond to all good faith inquires.

God bless…

Terry L. Peterson Social Entrepreneur Social Housing Enterprise, Inc.

Mr. Peterson’s career background spans 35 years in the fields of construction

management and real estate development. He is an honored alumni of Colorado State University Global Campus, and holds dual Master of Science degrees in Organizational Leadership and Management, with specializations in Strategic Product Innovation, and Managing Dynamic Environments. Terry is also designer, and intellectual property holder for an ultra high performance concrete (UHPC) precast modular building system for manufacture and construction of affordable housing for global markets.


Glossary

Affordable Housing

Residential housing that cost an occupant family no more than 30%

of total family annual income. Annual income * 30% / 12 months,

equals monthly housing costs for an individual or family unit.

Blockchain A distributed digital ledger on a decentralized computer network in

which transactions are recorded chronologically and publicly

observable.

Cryptocurrency A decentralized digital currency in which encryption techniques are

used to regulate the generation of units of currency, and verify the

transfer of funds that operate independently of a central bank.

Cryptocurrencies provide an outlet for personal wealth that is

beyond restriction and confiscation.

Social Innovation Social innovation is the process of developing and deploying effectiv

solutions to challenging and often systemic social issues in support

of societal progress.

Social Welfare The well-being of the entire society. Social welfare is not the same

as a standard of living, but is more concerned with the quality of lif

that includes factors such as affordable housing costs.

Individual Social Responsibility (ISR)

ISR includes the engagement of each person towards local or globa

communities, which can be expressed as an interest in actively

participating to solve critical social welfare problems.

Social Entrepreneurial

Social entrepreneur is a leader or pragmatic visionary who achieves

large scale, systemic and sustainable social change through a new

invention, technologies, or strategic planning of organization affairs.

For-Profit, Philanthropy

Non-profit philanthropy is quest to do good things for society that

stems from a personal desire to give back for the greater good.

For-profit philanthropy is simply a means to accomplish that same

goal, without the heavy hand of governmental authority controlling


who may, and who may not benefit from those philanthropic efforts

SOHO The Social Housing Enterprise, Inc.

SOHO Sponsorship

Compassionate individuals in the public at large who contribute

funds to SOHO for growth of affordable housing supplies for cost

burdened families. SoHo network activities for SOHO sponsors can

provide generous personal benefits to all SoHo users.

SHREIT Property Portfolio

Residential housing purchased by SOHO that is owned, operated, an

managed as a affordable rental properties. SOHO properties will be

made available to qualified families at rental rates consistent with

the HUD 30% threshold for housing affordability.

SHREIT Property Portfolio Fund

A cryptographically secured, digital monetary fund establish for

purchase of residential housing to grow the SHREIT portfolio of

affordable housing properties.

SOHO Economy A circular economy in which crypto assets are the value proposition

for all SOHO activities. Crypto assets mined on the SoHo network

can be exchanged for SREIT share ownership. SREITs will purchase

real estate properties with SoHo crypto assets at respective market

value. Crypto assets held outside the SoHo social network may be

contributed to SOHO as reinvestments to help grow the affordable

housing portfolio. Crypto assets contributed to SOHO will increase

mining permit quantities. That cycle repeats in a closed loop

constituting a circular economy.

SoHo The SoHo Social Network, Inc.

SoHo Social Network

A true social network that allows SoHo network members to

communicate with other members through posts, comments,

pictures, and private messaging as currently found on Facebook™

and other commercial social networks. Users participation in SoHo

network activities unfold as multiple processes for crypto asset

mining.


SoHo Members SOHO sponsors who join the SoHo social network to participate in

socially beneficial network activities. SoHo members individually

mine SoHo crypto assets for personal benefit.

SoHo Mining Permit

A digitally secured user account that contains record of a SOHO

sponsor’s social contribution to the SOHO SHREIT fund. SoHo minin

permits authorizes network members to mine crypto assets equal t

their SOHO contribution amount. Mining permits may be reloaded b

making new contribution to the SOHO SHREIT fund..

Crypto Assets Digital elements that network miners accumulate through crypto

asset social mining. Minet crypto assets become the personal

property of SoHo network miners. Crypto assets have no monetary

value within the SoHo social network. Mined crypto assets can be

downloaded into a digital wallet and removed from the SoHo

network.

Bonus Crypto Assets

Bonus crypto assets will be added to network member mining

permits for each personal T3 invitee who upgrades to T3 member

status.

Property Offerings

Properties offered to SOHO by network members for purchase by th

SoHo property acquisitions team. Property offerings are a lucrative

way to mine SoHo crypto assets.

Return on Participation (ROP)

The net results of network user participation in SoHo network

activities. Crypto assets are the net ROP benefit of SoHo network

participation.

Mortgage Interest Fees

The price paid to mortgage lenders for award of a home purchase

loan. Total mortgage interest fees are a product of purchase price,

generally a fixed interest rate, and term for repayment.

Rental Revenues The sum of money received monthly by SOHO from rental clients

who occupy SHREIT rental properties. SOHO operation costs are

paid from rental revenues. Rental revenues in excess of budgeted


operating cost will be transferred into the SOHO SHREIT portfolio

fund.

Real Estate Assets

SOHO portfolio properties are owned by SOHO under fee simple dee

conveyances. The SOHO SHREIT portfolio fund is the single source

of funds for all property purchases.

PRI Loan Program Related Investment loan. SOHO will issue a interest bearin

PRI development loan to SoHo for budgeted development costs of

the SoHo blockchain enterprise application. The PRI loan will be

repaid with interest to SOHO by SoHo..

SREITs Private real estate investment trusts (SREITs). SREIT(s) will offer

shares to crypto asset owners in exchange for SoHo crypto assets.

SREITs will purchase and manage residential properties for rental

revenue generation shared by SREIT shareholders.

Title IV Regulation A+ Type II of the 2012 JOBS Act

Title IV allows startups and later stage pre IPO companies to use

equity crowdfunding platforms to raise investment capital from bot

accredited and non-accredited investors. SoHo will offer shares in

SREITs to SoHo crypto asset holders.


References: FRED, (2017). Housing inventory estimate: Vacant housing units for the United States. Federal Reserve Bank of St. Louis . Retrieved from https://fred.stlouisfed.org/series/EVACANTUSQ176N HUD. (2017). Affordable Housing. US Department of Housing and Urban Development. Retrieved from HUD Affordable Housing Leopold, J., Getsinger, L., Blumenthal, P., Abazanjian, K., and Jordan, R. (2013). The housing affordability gap for extremely low-income renters is 2013. Urban Institute. Retrieved from https://www.urban.org/research/publication/housing-affordability-gap-extremely-low-income-renters-2013 . Lewandowski, M. (2016). Designing the business models for circular economy—Towards the conceptual framework. Sustainability 8, no. 1: 43. Retrieved from http://www.mdpi.com/2071-1050/8/1/43 Lim, C. (2007). Google. org, For-Profit Charitable Entity: Another Smart Decision by Google. Kan. JL & Pub. Pol'y , 17 , 28. MGI. (2014). A blueprint for addressing the global housing challenge. McKinsey Global Institute. Retrieved from McKinsey.com Tackling the World's Affordable Housing Challenge . SEC. (2015). SEC adopts rules to facilitate smaller companies’ access to capital. U.S. Securities and Exchange Commission. Retrieved from https://www.sec.gov/news/pressrelease/2015-49.html


https://fred.stlouisfed.org/series/EVACANTUSQ176N

https://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/affordablehousing/.

https://www.urban.org/research/publication/housing-affordability-gap-extremely-low-income-renters-2013

https://www.urban.org/research/publication/housing-affordability-gap-extremely-low-income-renters-2013

http://www.mckinsey.com/global-themes/urbanization/tackling-the-worlds-affordable-housing-challenge

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