Rethink Real Estate. For Good.

Community

Equity is the thread.

John Folan is an architect and teacher like no other I know. He frames his work around issues of the environment, social justice and equity. Not only is his own body of work significant, but he is dedicated to teaching students to be the next generation of thoughtful architects, makers and citizens.

John is probably best known for his work in Pittsburgh, as founder of the Urban Design Build Studio. He has used design processes to work with under-represented communities on the development and implementation of a variety of interesting projects for most of his professional career. In 2011, he co-founded PROJECT RE_ also in Pittsburgh, geared towards creating entrepreneurial opportunities for local communities with a three-part mission: “Reuse materials. Rebuild communities and Restore lives by teaching trade skills to help people secure a living wage.”

In 2019 John was appointed architecture department head in the Fay Jones School of Architecture and Design at the University of Arkansas. Previously he was the T. David Fitz-Gibbon Professor of Architecture at Carnegie Mellon University’s School of Design. His work has been recognized by the American Institute of Architects (AIA), the Association of Collegiate Schools of Architecture (ASCA), and Design Corps SEED Awards. Before joining Carnegie Mellon University, John was a tenured faculty member at the University of Arizona, and the co-founder of Drachman Design Build Coalition (DDBC), a university-affiliated, non-profit corporation dedicated to the design and construction of environmentally specific, energy-efficient, affordable housing prototypes. He has been registered as an architect since 1995 and a LEED Accredited Professional since 2008.

Insights and Inspirations

  • Successful design projects can emerge organically out of conversations with communities and stakeholders long before any building or idea is imagined.
  • Design training has increasingly become important to fields outside of architecture, because of the ability to think critically and across disciplines.
  • Design education should help students to understand opportunities, while learning an agility that allows them to adapt and grow and change.
  • Cities have actually been improving, making strides towards being much more inclusive in terms of both social and economic platforms, although we have to move the meter much further.

Information and Links

  • John founded and leads the The Urban Design Build Studio (UDBS), a collaborative of students, professors, and allied professionals who work with community residents on implementation of appropriate, affordable, replicable design solutions.
  • John also founded PROJECT RE_, with a mission to reuse materials and facilitate landfill diversion; rebuild communities by strengthening capacity of local residents; and restore lives by teaching people trade skills to secure a living wage. The 10,000 SF Project RE_ space includes a community room, design studio, gallery and workshops for wood, metal, masonry, and digital fabrication.
  • And here’s an example. Re_Fab is a mobile fabrication lab that brings digital tools and educational activities to your front door.
Read the podcast transcript here

Eve Picker: [00:00:17] Hi there. Thanks so much for joining me today for the latest episode of Impact Real Estate Investing.

Eve: [00:00:23] My guest today is John Folan, head of the Department of Architecture and Design at the University of Arkansas. John is probably best known for his recent work in Pittsburgh. As founder of the Urban Design Build Studio, he has used design processes to work with underrepresented communities on the development and implementation of a variety of interesting projects. And in 2011, he co-founded PROJECT RE_, also in Pittsburgh, which was geared towards creating entrepreneurial opportunities for local communities with a three part mission: re-use materials, rebuild communities and restore lives by teaching trade skills to help people secure a living wage.

Eve: [00:01:16] Be sure to go to EvePicker.com to find out more about John on the show notes page for this episode, and be sure to sign up for my newsletter so you can access information about impact real estate investing and get the latest news about the exciting projects on my crowdfunding platform, Small Change.

Eve: [00:01:40] Hello, John. It’s just lovely to be able to chat with you today.

John Folan: [00:01:45] It’s great to speak with you, too.

Eve: [00:01:46] Yeah, it’s been way too long.

John: [00:01:48] Yeah.

Eve: [00:01:49] So, you are now the head of the School of Architecture at the University of Arkansas. But I’ve known you, I knew you through your tenure at Carnegie Mellon University and saw you launch the Urban Design Build Studio there. It’s pretty rare to meet an architect and teacher who is so squarely focused on public interest and equity. And I wanted you to tell me a little bit about the Urban Design Build Studio and the goals you have there.

John: [00:02:19] Well, the Urban Design Build Studio is still alive and well, actually, I’ve carried it with me to the University of Arkansas and it’s now at the Fay Jones School of Architecture. We’re on the initial phases of the first project down here, with promises of many more to come, even in the context of the changes that we’re experiencing with the pandemic. The focus of the Urban Design Build Studio is really to focus on public interest design issues. The clear objective is to use collective intelligence so that the work benefits from the perspectives of multiple entities, multiple individuals, people of multiple expertise. And what we’re trying to do is develop work … tangible outcomes, tangible impact that is replicable and appropriate for the circumstances being addressed. So, it’s quite often that Urban Design Build Studio projects start without having an idea of what the project is, but they emerge more organically out of conversations with community stakeholders and community leaders.

Eve: [00:03:41] So, tell us a little bit about the first project that you’re doing there. Or, maybe a past project that you did in Pittsburgh, but one that you think is really a good example of what you’re trying to do.

John: [00:03:51] I think probably the best example of the one in Pittsburgh, and then I can talk about what we’re starting to do here. The projects in Pittsburgh have ranged in scope from a fabrication facility to a cafe to housing proposals and all sorts of projects in between. Mobile advocacy projects, as well. Probably the one that demonstrates the underpinnings of the Urban Design Build Studio best would be Cafe 524, which is now the Everyday Cafe in Homewood. That project was initiated with …

Eve: [00:04:34] Everyday Cafe?

John: [00:04:36] Yeah, Everyday Cafe, which is right there on North Homewood Avenue, in Homewood, and that project emerged out of a chance introduction to Dr. John Wallace at the University of Pittsburgh and is a native of the Homewood neighborhood, and working with students. By virtue of the suggestion of the Urban Redevelopment Authority, we started working in Homewood and and started with some community engagement, met Dr. Wallace and really focused on this notion of a “third place.” And he had put together a group of people who were interested in establishing a third place and a business opportunity for local residents, and put together a team with Operation Better Block and obtained a license agreement for the property, and then ultimately stuck with that project. And Dr. Wallace has now run that facility for about three years. So, that’s the type of project that probably best exemplifies an organic path to coming up with something that’s meaningful and sustainable for a community.

Eve: [00:05:53] A little bit of background for our listeners. So, Homewood is one of the neighborhoods that kind of suffered most, I think, when Pittsburgh lost half its population, and really hasn’t come back. I don’t know about, I don’t know the demographic numbers there, maybe you do, but it’s very poor …

John: [00:06:12] Yeah, it’s one of the most economically challenged neighborhoods in the city, if not the most, depending on the sector of the neighborhood that you look at. It is, it demonstrates the most challenged characteristics in terms of median income levels. So, there are a number of factors that the significance of that project and the significance of having stakeholders who are really invested in the community, and want to sustain something. So, you know, the work of the Urban Design Build Studio, we’re bringing design services to a group of individuals who may not have had access to those services otherwise. And to achieve something that they might not achieve otherwise. By virtue of affiliations with a research university, there’s an opportunity to spend longer periods of time and working on the projects with those stakeholders than might be possible in a traditional market rate scenario.

Eve: [00:07:13] So, your projects are then in pretty underserved neighborhoods where people are in serious need economically, or affordable homes, or any variety of those options, right?

John: [00:07:27] Yes.

Eve: [00:07:29] Okay. And so you also launched PROJECT RE _ in Pittsburgh. And I don’t know if you took that with you as well. But what was that about?

John: [00:07:37] PROJECT RE_ was a way to expand the efforts of the Urban Design Build Studio. I’m still the executive director of PROJECT RE_. PROJECT RE_ was focused to address regional issues in Allegheny County and Pittsburgh, focusing on restoring community, rebuilding lives and re-use of materials. So, it was a transactional entity and a physical space that has been put together to bring design expertise … You submit materials that are extracted from building deconstruction associated with blight that exists, in Pittsburgh, and then involve efforts of job skill training in the creation of the projects. So, it’s a, the space is about 20,000 square feet in size. There’s a large community meeting center. There’s a gallery in there. There’s a small studio. There’s an industrial fabrication shop that has CNC technology as well as a wood shop. And then there’s an assembly area, and welding training centers.

Eve: [00:08:49] Wow.

John: [00:08:50] Since 2012 that’s been the main working space for the Urban Design Build Studio in Pittsburgh. And we plan to use that space, now that I’m in Arkansas as the head of the Fay Jones School, the intention is to use that space in the summers for design build projects with a number of universities around the country and potentially around the globe, to work on projects that are more targeted in nature, and bring people to Pittsburgh. And then during the year, we’re planning on moving forward to have a series of fabricators and artists and residents who work on projects and initiatives that they’re interested in.

Eve: [00:09:41] That’s pretty extensive. So, how do you hope these initiatives will impact architecture, and architects as citizens, in general? This is not what most architecture schools do, right?

John: [00:09:54] No, it’s not, but I think that there’s been a growing awareness of it. I would say it’s become much more common now. There’s a much greater awareness of the benefit that people can have. I think that, you know, when we talk statistically, if you reference the Cooper-Hewitt Museum exhibition from a number of years ago, you know, they always talk about the other 98 percent, that two percent of the population can afford to use the services of an architect. That statistic is not really correct. The language, more precisely, should be to two percent of population elect to use the services of an architect. And so if we take a look at that, that 98 percent sector is enormous. There is a large portion of that sector that simply don’t value design. And so there needs to be greater awareness.

Eve: [00:10:53] I used to always say that people would spend more time picking the sneakers they buy then choosing an architect, right?

John: [00:11:00] True. Yeah, they will. And so there’s a culture that has to be cultivated around that and and an appreciation for that. So, the intent here is not that every student emerges wanting to be a contractor, or wanting to build their own work, or that they pursue public interest design as a full-time endeavor. But it’s more that we’re elevating their awareness, more that we are helping them to become better citizens, helping them to understand opportunities and how to navigate the context of projects to help them be innovative in ways that are appropriate and have impact to broader communities.

Eve: [00:11:41] You know, I’ve always thought that architectural training is really unique because it teaches these kids to take nothing and turn it into something in a very creative way. And it’s a training and problem solving that I don’t think, I don’t think you can really match in another profession, but maybe in engineering, but perhaps not so creatively there.

John: [00:12:04] No, I agree entirely. I think that it’s an enormous skill set. And most of the students who are successful in migrating the whole way through a curriculum possess a great deal of passion, and a great deal of persistence, as well. And I think those sensibilities and those attributes become so important. And I think that we undervalue ourselves …

Eve: [00:12:30] Yeah, I agree.

John: [00:12:31]  … quite clearly. And, you know, and it’s interesting, too, this trend towards project-based learning that has been adopted across academic circles. You know, it’s really interesting, that’s been embedded in architectural education since its inception. We never seemed to value it. But now other academic units find enormous value in it. And it’s something that’s always been inherent, what we do.

Eve: [00:12:57] So, you know, I’m an architect by training and I’ve morphed over the years into now … I’m a fintech expert! And who knew? But I would say that, you know, early on when I was young, I had a very hard time thinking about leaving architecture because it felt like a waste of training. But I’ve realized over the years that’s absolutely not true, and that training has helped me in innumerable ways. So, I wonder whether architecture schools are getting better at showing young architecture students the possibilities of what they can do with this training. They don’t need to just go work for a, you know, a starchitect somewhere, but there’s sort of endless possibilities for what they can do.

John: [00:13:45] No, I think that students emerging today are so much more aware. I do think that schools are being far more successful in terms of providing opportunities  to students that suggest the full spectrum of things, that they might branch out and might explore professionally after they leave the academic setting. It’s really interesting. I’ve always been amazed at what you’ve accomplished. And I think in a way you’re sort of the poster child for …

Eve: [00:14:19] The wayward architect, right?

John: [00:14:20] Well, yeah. I mean, but not really. You’ve always come back and you’ve been an advocate for design. And I think that, I think where there’s now greater awareness of what architectural education can do is evidenced by programs that are not necessarily professional programs. Like four year programs that are really elevating the awareness of young individuals about the potency of design, what design has to offer. And what happens is those people who graduate, say, with a bachelor of science that will not position them for professional licensure, they’re merging and entering other disciplines, allied disciplines and allied fields. Allied fields are as important, as you know, to the implementation of innovative work as design. I mean, so, yes, I think that the schools are much better now at getting students away from navel-gazing. You know, where you just sit in isolation and try to develop things in isolation. I think that there’s much more emphasis placed on collaboration, team building. I think you see that across the board.

Eve: [00:15:37] Yeah, that’s pretty fabulous. So, as head of the architecture school there, what do you think is the most vital now for the next generation of architecture students, then?

John: [00:15:49] Well, I think it’s probably the same thing that it’s always been, is agility. And I think that’s probably a lot of what we’ve been discussing today, is the the ability of somebody to adapt to a situation, to understand a situation, to bring different levels of expertise and to orchestrate that expertise in a positive way. It’s also knowing when to be a soldier and when to be a leader. And I think that those are important things, important sensibilities. And of course, with climate change being such a significant factor, I mean, that has been part of the conversation. We’re starting to see much greater awareness in the area of social justice and equity. That will need to continue as well. So, I think, again, this training is a problem solver. It’s really just the critical thinking skills and being agile that you really want to have somebody emerge with. They don’t feel that they’re indoctrinated, in a way that they’re equipped with a series of tools that will allow them to adapt and grow and change …

Eve: [00:17:01] Yeah.

John: [00:17:01] … as they move through their career.

Eve: [00:17:03] I’m jealous that they’re learning that so young. Because it really wasn’t a possibility when I went through school.

John: [00:17:08] Yeah, no. Same for me. There was one way to do it. And you kind of had to find your way after you got out.

Eve: [00:17:16] We had to butt our heads against it, right?

John: [00:17:18] Yeah.

Eve: [00:17:19] So, what’s your background and what … You’ve spent a life kind of fascinated with equity in architecture and in the physical environment. And I’m just wondering how you got there.

John: [00:17:29] Well, I’m always proud to tell people that I’m from Chicago, if they’re willing to ask and if they can’t discern from my accent. So, I had, you know, I’m also old enough that when I was young, there were a number of significant buildings that were being constructed at the time. And I was fortunate enough to have the opportunity to see those buildings being built and was just fascinated by construction and the physical environment. And so I really can’t remember a time where I did not want to be involved in architecture, professionally. It was always a an interest of mine and something that I thought would be a great privilege to be involved with. I think as I got older I started to develop an interest in affordable housing and equity, just by virtue of circumstance that I had growing up. Then my career took me about as far away from that and as you can get and I went to work for a couple of starchitects and worked on large projects, significant projects. And then I was principal for a large, well-known firm. And when … I hit a point in my career where I was not addressing things necessarily related to equity and not related to issues in neighborhoods that I felt needed help and made it a sea change in my career and focused on nonprofit work … an extension of that. So that’s kind of the path I took.

Eve: [00:19:07] Yes. We know that you care about socially responsible real estate, but are there any current trends in real estate development that interest you the most? And perhaps the second question is, given what’s going on with the coronavirus right now, how might an architecture change to address things like pandemics and keeping people safe?

[00:19:33] Those are really interesting questions. And, you know, it’s interesting that you’re asking it because the answer, probably .. well, it might have been same a few weeks ago, but it’s … you know, given the perspective that we all have at this time. Of course, it’s changed all of our perspectives. Things that are interesting in terms of real estate; I think that there’s much greater awareness of how market rate development can be leveraged to advantage mixed-income development and provide an opportunity for communities where fixed income residents can be part of a successful neighborhood. I think that there’s an enormous amount of advocacy that is still needed with regard to that. Issues around gentrification. I think people are very keenly aware of some of those issues, but a lot of what’s perceived as gentrification, it is byproduct, in fact, of misinformation many times. That there’s a perception that somebody will be pushed out rather than understanding that there’s a mechanism for long-term residents to stay in an area. So, I think advocacy there becomes really important. The things that Small Change is doing by allowing people to invest through crowdsourced funding is incredibly important. I know the range of projects that you have that are demonstrated through the website really illustrate the potency of groups of people coming together to impact change in areas where it would probably be risk averse in terms of taking on opportunities. So, those are probably the areas in development. In terms of response to the pandemic, I really am at a loss on that.

Eve: [00:21:28] I am a little bit, too. But I’ve been thinking a lot about Small Change. And first and foremost, I have this tool that lets everyday people invest. And yet, you know how many people filed for unemployment in one week, this …

John: [00:21:43] Yeah.

Eve: [00:21:43] … last week? You know, and I can’t really kind of reconcile the two at the moment. I think we’re going to have to wait and see.

John: [00:21:53] Yeah. Yeah, no, I, You know when I think, with the pandemic, I think I probably, I haven’t been thinking about it in terms of the investment side. But the point that you raise is really important. My mind tends to shift more towards the practicalities of one’s physical health. And then, of course, I   of the work of MASS, things that they’ve done with Dr. Farmer, and just simple things.

Eve: [00:22:21] We’re going to see a sea of technological changes as to how you open doors for example.

John: [00:22:28] Oh yeah. No, that’s right. Yes, it will it will transform those things that we take for granted. So, fundamentally. Yes.

Eve: [00:22:35] Yeah, it’s a bit crazy. And of course it’s having an impact on your school because the teamwork that is clearly really part of what you’re doing is sort of being shut down at the moment, right? With the students and how they work together. Or has it? Or are you finding other ways to do that?

John: [00:22:53] Well, we’re still in the first weeks. I think unfortunately … what struck me … You know, it’s interesting if I just relay a story. When we made, when they first made the announcement they were going to distance learning, and anybody who knows architects knows how, understands the intensity of the educational process and studio culture. The younger students in the school happened to be outside my office and I heard this eruption of laughter. And, you know, they’re quite happy that they might gain relief from the demands of the curriculum. And then, when I went up to visit my studio, because I work with students who are further along in the program the kids were in tears. And it was at that time that I really realized the impact that it’s having on those who are emerging into the profession. They understood the gravity of the situation at that time by virtue of the fact that they understood that was probably gonna be the last time they were going to see their classmates as a large group. That was, you know, the celebrations of graduation were clearly going to be suspended, at least for a while. And then, immediate concerns over what it meant for viability of their professional future … the immediate viability. So, I think your perspective, depending on your age …

Eve: [00:24:30] Yes. Definitely.

John: [00:24:30] … changes and your understanding of the impact.

Eve: [00:24:39] Yeah, and then, I asked the current terms question in other interviews and a month ago, you know, people are talking about co-working. And this month, I have to wonder if co-working is dead. You know, it’s very, very difficult …

John: [00:24:57] Yeah.

Eve: [00:24:57] … It’s difficult to imagine. Anyway, now we’re down this depressing path, so.

John: [00:25:01] Yeah. Well, I think to think about it optimistically, you know, going back to what we said. This is a wicked problem. And it’s not a wicked problem. It is illuminating thousands of wicked problems. And I think that the opportunities will emerge out of what we understand. And I think right now it’s so early in the process, as we start to come out of this, as the virus is controlled and contained, and we start to plan for the future. I think that will open up all sorts of avenues. But what those are I don’t know, and I really haven’t had time to speculate.

Eve: [00:25:47] But, you know, I think architects might be at the center of some solutions, I’m sure. So.

John: [00:25:52] Yes. Yeah.

Eve: [00:25:53] So, it’s actually a very interesting thought. How do you think we need to think about our cities and neighborhoods to build better places for everyone?

John: [00:26:04] Well, I think we’ve been on a rather positive trajectory. When I was a, you know, again, going back to when I was a child, when I was a child cities were horrible places. You didn’t want to be in cities, you know, unless you were really serious about urbanism. We avoided cities. And I think that the perceptions of cities really didn’t start shifting until the early 90s. And it really hasn’t been until, I would say, the last decade that we’ve seen the benefits of positive urban thinking, and consideration of new models of development. Yeah, I think that the cities are making strides towards being much more inclusive in terms of both social and economic platforms. And so, we still have to move the meter a lot further in terms of that. You still have, you know, there’s still issues of segregation. There’s still issues of economic disparity and concentrated poverty. So, I think that where urban environments need to start moving is towards deep concentration of those negative attributes. I think that it has gotten significantly better in recent history and I think we are on a path forward. And again, I think crowdfunding in support of developments is a significant component to that continued success in the future. I do think it’s interesting, we always talk about density being … and then, of course, in cities like Pittsburgh, where there been a population loss, you know, the term that was developed was “right sizing.” I don’t know if the pandemic is is going to lead us to start thinking about what appropriate levels of density are or how that ties into the general health and well-being that’s to be determined in the future.

Eve: [00:28:16] Well, I really enjoyed this conversation, and I’m excited to see how you and your students put some thought to the post-pandemic problems and the future that we’re all looking at. It’s going to be really interesting to see.

John: [00:28:31] Well, thank you. I really enjoyed the conversation. This has been a great conversation.

Eve: [00:28:37] Ok, bye John. Bye.

John: [00:28:37] All right. Bye Eve. Thanks.

Eve: [00:28:44] That was John Folan, head of the Department of Architecture and Design at the University of Arkansas. John is an architect and teacher like no other I know. He frames his work around issues of the environment, social justice and equity. Not only is his own body of work significant, but he is dedicated to teaching students to be the next generation of thoughtful architects, makers and citizens.

Eve: [00:29:21] You can find out more about impact real estate investing and access, the show notes for today’s episode at my website, EvePicker.com. While you’re there, sign up for my newsletter to find out more about how to make money in real estate while building better cities.

Eve: [00:29:38] Thank you so much for spending your time with me today. And thank you, John, for sharing your thoughts. We’ll talk again soon. But for now, this is Eve Picker, signing off to go make some change.

Image courtesy of John Folan.

Maintaining a place for the community.

When wealthier individuals and organizations move into an urban neighborhood, both the rental and property values as well as the culture and character of the community can change. This process is known as gentrification. While this shift can do good and often results in the revitalization of struggling areas, it can also leave many people in the existing community priced out of their own neighborhood and even worse, displaced. Today, as gentrification takes place in more and more urban areas across the country, many socially conscious developers, investors and urban planners have thankfully become sensitive to the issue. And many of them are looking for ways to maintain a place for existing, lower-income members of communities that are faced with the changes that will inevitably come. One such example of a large project in a rapidly gentrifying community is the Bushwick Generator in the East Williamsburg area of Brooklyn.

Background

Williamsburg, a north Brooklyn neighborhood situated on the waterfront, was historically a manufacturing district. It originally developed due to a boom in industry in the area in the early 1900s. Over the last two decades it has increasingly transformed into a trendy neighborhood, for living, eating, shopping and visiting. And as always, the pressure of development has resulted in spill-over development activities in the adjacent neighborhoods of East Williamsburg and Bushwick which have now also become much sought after areas to live in. This is in part due to the fact that these neighborhoods are well-served by public transit. They are right on the L train, a primary mode of transportation between Brooklyn and Manhattan.

The Bushwick neighborhood itself is a diverse community with a strong Latino and African-American presence along with other immigrants and young creatives. But Bushwick is now beginning to experience the leading edge of gentrification with the arrival of affluent media and tech businesses, along with their employees, into the area. These new businesses threaten to change the neighborhood’s long-standing character and are putting at risk the affordability of the neighborhood for some of its existing residents.

About the Bushwick Generator

The Bushwick Generator is housed is a massive warehouse which was purchased by a developer in 2015. The developer’s goal was to create a “community influenced innovation lab and creative hub.” The Generator has 100,000 square feet of space and is in the process of being developed for commercial, nonprofit and creative tenants, and, most importantly, as a resource for all members of the community.

In 5,000 square feet of now-completed space, Emerick Patterson, one of the leaders of the project, does community outreach and neighborhood work. His primary goal is to offset the effects of ongoing gentrification. As media and tech tenants continue to move into the area around it, the Bushwick Generator offers not only a resource for members of the existing community but also an opportunity for them to impact what goes on in the large spaces around them.

The project is still in its early stages and is exploring how the total space can be used. Yet, at the forefront of this planning process is what members of the neighborhood want, whether that be a place for job training, job readiness, or simply a space to gather and meet. The Bushwick Generator has an open-door policy and works to get as many members of the community through the doors as possible. They regularly host events, working hard to ensure that all events are attended by members of the community. First and foremost, they want to ensure that locals are getting access to knowledge about what is now going on in the neighborhood.

Patterson says that, ideally, these efforts will result in some changes to the ongoing tech influx in the area and that the Generator will enable all members of the community to feel connected, comfortably engaging in area events and confident enough to ask for help when needed.

To learn more about the Bushwick Generator and other projects in the area, listen to the full interview with Emerick Patterson.

Image from Pxhere licensed CC0 Public Domain

First in. Towards growth.

Lance Chimka, who became Director of Allegheny County Economic Development (ACED) in 2018, oversees an agency responsible for business expansion, planning, community and real estate development, and affordable housing projects for the second most populous county in Pennsylvania.  

Born and bred in Pittsburgh, Lance has long been familiar with the changes the region has gone through in its shift from a deeply embedded, industrial economy to one grounded in medical research, higher education and technologies such as robotics and cybersecurity. Soon after taking over at ACED, he noted that the local economy is hitting an important juncture, one in which Pittsburgh and local municipalities need to think beyond “eds and meds,” adding that a decade after the 2008 financial crisis “we’re in an economic expansion, but we’re not seeing some of the growth that other benchmark cities are seeing.”

Lance previously worked within the Pennsylvania Department of Community and Economic Development where he was Regional Director of the Governor’s Action Team, focusing on removing barriers to development, investment and job growth in the 11-county southwestern Pennsylvania region. And prior to working for the state, Lance led community development programs, commercial lending, business attraction and expansion activities for the ACED for a number of years.

Lance is certified as an Economic Development Finance Professional and he served in the U.S. Peace Corps, in Turkmenistan.

Information and Links

  • Lance is really proud of ACED’s partnership with RIDC to help the startup, Fifth Season, build a vertical farm in Braddock, PA. The project was profiled by Fast Company and won a NAIOP light industrial project of the year award.
  • Lance loves Pittsburgh International Airport’s microgrid project – he thinks it is both important and under-rated. Forbes loves it too.
  • And he’s inspired by the tech entrepreneurs that have led Pittsburgh into the forefront of the innovation economy, like Duolingo, MeeterFeeder or Thread.
Read the podcast transcript here

Eve Picker: [00:00:18] Hi there. Thanks so much for joining me today for the latest episode of Impact Real Estate Investing.

[00:00:24] My guest today is Lance Chimka. Lance is the relatively new and extremely energetic director of Allegheny County’s Economic Development Department, in Pittsburgh, Pennsylvania. He has a very contemporary take on what government ought to be doing, and that includes investing in real estate to advance the economy. Lance is building a collaborative team environment, working with developers throughout the county, lending where banks dare not go, always with his eye on economic development growth, and always with the thought of how our region can do better. Learn how Lance and his team are supporting development in a not-quite-market rate environment.

[00:01:11] Be sure to go to EvePicker.com to find out more about Lance on the show notes page for this episode. And be sure to sign up for my newsletter so you can access information about impact real estate investing and get the latest news about the exciting projects on my crowdfunding platform, Small Change.

Eve: [00:01:37] Hi, Lance. I’m really excited for the opportunity to talk to you today.

Lance Chimka: [00:01:41] Pleasure’s all mine, Eve. Thank you. I’m honored that you would have me on.

Eve: [00:01:45] We’re gonna have a great time.

Lance: [00:01:46] Absolutely. We usually do.

Eve: [00:01:48] In a not a lot of time, you’ve gone from being an intern at Allegheny County Economic Development to the organization’s director. And then you did a few odd jobs in-between. And that’s a pretty meteoric rise, wouldn’t you say?

Lance: [00:02:06] Ah, yeah. I mean, I guess it has been pretty quick. It sometimes didn’t feel that way. But I think the cool thing about that is that whole progression is absolutely vital to some of the stuff I want to get done, now. I wouldn’t have changed that course, at all. Like, understanding kind of the daily struggles of interns in my office absolutely directly informs how I work on efficiency measures here, for example. It’s been incredible and I’ve been really lucky to have incredible mentors along the way that have taught me a lot. That was one of my favorite things about public sector work, is it touches so much, that you’re able to, you’re able to learn.

Eve: [00:02:45] What led you to pursue a life in government service? Was it that first internship that you just liked so much?

Lance: [00:02:52] When I was pursuing an undergrad degree in finance, it was kind of in the boom times, the 2000s, and I didn’t want to take that route. Kinda always been a volunteer at heart, and so I joined the Peace Corps, and that was kind of the start of my real public service. And I just kind of knew, I came back to go to CMU and get a policy degree and just kind of always knew, in my heart of hearts, I would always be in some kind of public servant role. Not necessarily in government work, but that’s the path that I’ve chosen to this day, and it’s been incredibly rewarding.

Eve: [00:03:27] So, that what drives you, yeah. So, for listeners who haven’t connected the dots yet, Lance and I share a hometown, Pittsburgh, and a few decades ago, Pittsburgh was pretty well all but written off. You can listen to my podcast interview with Tom Murphy that I think just went live and you’ll get to hear the turnaround mayor talk about where we were then and what it took to shake that image. And that brings me to a statement that I read, that you made, Lance, which was, “we’re in economic expansion, but we’re not seeing some of the other growth that other benchmark cities are seeing.” And I’m just wondering what you meant by that?

Lance: [00:04:09] Not to, not to recap what you probably talked with Mayor Murphy about, but to get from the doldrums of 1983, which is really the trough of our local economy.

Eve: [00:04:19] It was the bottom, right? Yeah.

Lance: [00:04:21] Yeah. To where we’re at now, has been an amazing transformation, right? It’s been all about diversification and it’s, of a regional economy. And then we, now we have these five primary industry sectors: in financial services, IT, energy, advanced manufacturing and healthcare. And that’s really, really important because in recessionary periods, that diversified economy is very robust, and makes us the darling, and outperform benchmark cities in recessionary periods. However, the problem is that in expansionary economies we lack the kind of exponential growth that some of our other cities experience. It’s just kind of the nature of our economy currently, is slow and steady wins the race, which is fine. I think my goal is on the macro economic end, is to not throw the baby out with the bathwater, keep the diversification, keep the slow, steady growth, but then really experience some of the upside of expansionary times, which we’re in now. And I think the key to that is, and I’m really optimistic about the future of our economy, is across those five industry sectors. You have artificial intelligence, which we are an absolute worldwide hub of, cuts across all of those. And robotics, cuts across three of those, in advanced manufacturing, health care and energy. So, those eight intersection points that I think are the key to experiencing upside growth, and that’s some of the stuff I’m excited to work on.

Eve: [00:05:56] How do you work on that? How do you improve that?

Lance: [00:05:59] Great question. Especially like, how does government do that? The risk profiles associated with investments in startups are probably too, you know, too risky of an investment for governments to be making. And not to mention, we don’t have that skill set. But I think there are a lot of other ways we can invest in the city in a way to encourage that kind of growth. One of those ways is in real estate development, right? If you take something like biotech, right? A lot of times you’ve got companies that need wet lab space. You have extremely long periods to get through clinical trials. You have really expensive buildings that, you know, because of the nature of the beast, you have your non-credit tenants. So, I think when we’re making investments in real estate, we need to incentivize those kind of assets in buildings that aren’t going to happen in the open market. That’s just one example. We lack high-bay space for robotics. Some other specialty real estate that I think the public sector can play a role in: mitigating the risks for developers who have non-credit tenants, and making sure that building stock is available. Speculative development is another thing we’ve classically underperformed on. And in the kind of pace of the current economy, like, people are not waiting around 18 months to build a building, they want turnkey space ready to go. So, we’re working on a number of things to make sure that those types of building stock in speculative development is allowed for. And a lot of that is investment through tax abatements, and direct investment, and site assembly that I do here in this office. So, that’s just one example in real estate. I think you can find other examples in public infrastructure, amenities, recreational space, and being really intentional about how we connect our tech hubs through infrastructure work. Whether that’s public transit, or whether that’s, you know, really compelling a multi-modal streetscape design. Things like that.

Eve: [00:08:03] Quite a lot to think about, isn’t there?

Lance: [00:08:04] Yeah. Yeah. Keeps ’em busy.

Eve: [00:08:06] So, you also served as an advisor on Pittsburgh’s Amazon HQ2 proposal. And I’m wondering in retrospect how you feel about making it to the top 20 list, but not as an Amazon final city pick.

Lance: [00:08:20] Yeah, I mean, I feel great about it, because I think we extracted all the marketing benefit from it without any of the really, really, really painful stuff that might have been associated with it. I am proud of our approach to that. I think it was, hey, here’s a suite of stuff that we, as every Pittsburgher, there’s wide agreement that we need to invest in. And we don’t have a revenue stream to do that. So, let’s take that suite of things we need to invest in and treat this gargantuan investment coming our way as the revenue stream. You know, and I think it helped kind of distill that suite of, that wish list, if you will, for us. And now, ok, we might not have the revenue stream, but at least it helped distill what we want to be as a city, forcing us to go through that process. And I think it was overwhelming positive experience.

Eve: [00:09:13] What’s the top of the list that we should become?

Lance: [00:09:16] I think the two things that kind of rose to the top, given the time in our city and the way things are trending, are people want a really robust public transit network. I think that was clear. People want and are concerned about rapidly appreciating real estate values in some of our residential markets. And that would be exacerbated by a huge investment like that. And so I think it really rallied people around public transit, and around affordable housing. Which I think is a positive thing, you know?

Eve: [00:09:48] Yeah, no, I agree.

Lance: [00:09:50] It’s great that affordable housing is suddenly cool again. You know?

Eve: [00:09:53] Yeah.

Lance: [00:09:54] This is fantastic. People working in this field are like, wow, this great sea change, like, in a really short period of time.

Eve: [00:10:01] Yeah, that’s true. Affordable housing is a really hot button issue now, isn’t it? Everywhere.

Lance: [00:10:06] Yeah, no doubt. And it’s great. And I think ultimately, you know, we did not land that investment. I think predominately it was a numbers game, right? A population numbers game. You’re talking about …

Eve: [00:10:18] Yes.

Lance: [00:10:18] … a gigantic pool of workers, and being a small middle market city was tough for us to absorb that, A., and, you know, the facts that matters are we have zero population growth and a two million metro area, and it went to a place with a 20 million metro area and five percent growth. And a, what a, maybe a 12 million metro area, and like 10 percent growth down in D.C., right?

Eve: [00:10:42] Right.

Lance: [00:10:42] At the end of the day it was all about …

Eve: [00:10:45] The numbers.

Lance: [00:10:46] … you know, the numbers, demographics, bodies, population. And that put a fine point that we need to work on that as well, right? That’s a huge Achilles heel for us is a lack of population growth.

Eve: [00:10:56] It is and it isn’t. I mean, that part of Pittsburgh’s charm is its size. When you talk about what should Pittsburgh become, I think you should also think about what it shouldn’t become, right?

Lance: [00:11:07] Sure.

Eve: [00:11:07] It’s a pretty beautiful and rather unique city. And each city has its own strengths. I don’t know. For me, cities go beyond numbers, but perhaps not for Amazon.

Lance: [00:11:17] Yeah, well, exactly. I think, despite what they would tell you, I think they had to take a very analytic approach to that.

Eve: [00:11:23] Yes.

Lance: [00:11:24] And it’s something that like charm and culture and beauty were probably not heavily weighted …

Eve: [00:11:31] No.

Lance: [00:11:31] … on that algorithm scale, right? So. But I agree with you.

Eve: [00:11:35] Probably mobility and housing stock were right up there.

Lance: [00:11:38] Mm hmm. I imagine.

Eve: [00:11:39] You’ve barely started, but what would you like to accomplish at ACED?

Lance: [00:11:44] Oh, boy, I mean, a lot. So, our two-fold mission is this: one, is the work on the macro economic health of the city, which is really about building a diverse and growing regional economy that’s opportunity rich for everyone to tap into, right? And we addressed some of that already. The other part of our mission is much more neighborhood-based. And that’s, you know, we want to create healthy and vibrant communities. So, all of our investments, and we make those investments in the areas of housing, and industrial and commercial development, infrastructure development, parks and rec, things of that nature, all of our investments are done with that two-fold mission. So, there’s certainly a lot of things I think we can do and be more creative with the tools we have. You know, I’m a big proponent of good government, too, and I think there’s a lot we can do to make the public sector meet the needs of our citizens in a more efficient and customer-friendly way. So, that’s the other kind of side of this that I will work on is, not only mission delivery, but just, you know, government efficiency is a twisted hobby of mine that I like, I like working on.

Eve: [00:12:55] Ha! That’s a really great hobby.

Lance: [00:12:57] Yeah. I mean, everyone needs a hobby.

Eve: [00:12:59] Yeah.

Lance: [00:13:00] And to be more specific, again, I talked about the real estate assets that I think we need to incentivize. A big concern of mine is if you put communities, you can kind of classify them broadly in three buckets. And that’s, there are tons of communities that are thriving, and we need to support them. There are a number of communities that are revitalizing that need special attention. There are a lot of communities, they need stabilization. We need triage. And a lot of that is direct fallout from the 1983 exodus of people with any sort of social mobility leaving the city.

Eve: [00:13:37] Yeah. Yeah.

Lance: [00:13:37] And we have certain areas that, they have zero market. Land value is negative, right? And that presents a whole slew of economic and social problems that go along with that. And we really need to support those communities. At the same time, kind of leaving the development breadcrumbs from areas of high opportunity to establish markets, and you kind of need to string those investments along. It’s going to be a while until I can take the strength of the market that is the Strip District, for now, and pool it across the Allegheny Valley, right? And pool it down into the Mon Valley.

Eve: [00:14:14] Yeah.

Lance: [00:14:14] And in the process establish beachheads in Etna. And I need to establish that beachhead in Etna before I can really get to Tarentum and New Kensington, right? Same thing goes for the Mon Valley. I really need to establish a strong beachhead in Wilkinsburg and Braddock until I can really talk about strength of market in places like Clairton. In the meantime, we need to make sure that we are treating those communities with the respect that they deserve in addressing the blight and disinvestment they’re struggling with, and doing that in a really smart and strategic way.

Eve: [00:14:46] Well, it must be really tough making decisions because you can’t have endless resources, I’m sure. And then you have to decide where to direct those resources. And for people who don’t know who are listening, Pittsburgh was around 700,000 people strong and really lost more than half of its population in the 1980s. And it’s now still hovering just over 300,000. Although family units are smaller now.

Lance: [00:15:16] Yes.

Eve: [00:15:16] It’s still a lot of vacancy, right?

Lance: [00:15:18] Yeah, absolutely. And so, you know, there’s some opportunity there. You know, to some extent, affordable housing price per square foot is a supply demand calculation, right?

Eve: [00:15:27] Yes.

Lance: [00:15:28] The problem is the areas that are close to job centers, well-served by public transit, and have amenities like grocery stores. We’re seeing rapid appreciation there, and obviously, because they’re more desirable places to live. So, we need to make investments to ensure that those are mixed-income communities. And we also have the opportunity, though, that a lot of other cities don’t, to make proactive preservation investments in areas that have naturally occurring affordable housing. And we’re doing both of those things on the housing investment side.

Eve: [00:16:00] Real estate development is a major component of your work.

Lance: [00:16:04] Oh, yeah. I would say most of what we do has a real estate component to it. Now, one of the things we’re trying to get more engaged in, that we traditionally have not, is the workforce development arena. You know, I think one of the big transitions we talked about, like the change in public opinion around affordable housing … the innovation economy has forced site selection to go from a predominately site- and building-centric approach to predominately talent-based approach. And we, I think in the past, in the economic development community, have taken a very hands-off approach saying, hey, there are specialists in workforce development, we’re going to let them do their thing, and we’ll just, we’ll build the stuff, invest in those tangible building products. I don’t think that model works anymore. I think the workforce challenge and the future of work is such an acute need that we really need an all-hands-on-deck approach. And the more resources everyone can leverage, that and, the better. I’m just finalizing my budgets for next year and we’re probably making close to a million dollars in investments in workforce development, which doesn’t have a land and building component to it. And I’m proud of that. And I think that’s something we’ll continue to invest more heavily in. And that’s everything from workforce readiness of teens, to adults with barriers to employment, getting re-educated and prepared for the workforce. You know, we need to attack this from all angles.

Eve: [00:17:33] I was going to ask, is there a rhyme or reason to the projects you become involved in. But I think I’m hearing that your organization, you really play the role as almost a pioneer investor early on when perhaps it’s a little bit uncomfortable for private money to be involved?

Lance: [00:17:51] Oh, no doubt.

Eve: [00:17:52] Yeah.

Lance: [00:17:52] Yeah, absolutely. Our investments, I think, are predominately … well, one, we take first mover investments in site assembly. Right? For example. So, one of my big hypotheses was that people say there is no market, no real estate market in Braddock, right?

Eve: [00:18:14] Mmm Hmm.

Lance: [00:18:14] And I challenge that. I think it’s the fact that the available real estate is not the right kind of real estate. So, for example, we assembled 60 tax-delinquent, single-family structures, demolished them, consolidated them into one five-acre parcel, and worked with a very creative developer on a take-down period that worked for the finances of that kind of constrained market. And they built a 60,000 square foot high-bay light industrial building. It’s probably the first new industrial development in Braddock in, I couldn’t even tell you how long. This is a place that suffered 90 percent of population loss.

Eve: [00:18:52] Yes.

Lance: [00:18:52] Those are the type of things, in that case, we were a first mover and then worked on aggressive land conveyance strategy with the developer. And now the great thing is we have new tax base in Braddock, we new job base in Braddock, and almost more importantly, I have a comp now, I have established that land has value in Braddock.

Eve: [00:19:12] Oh yes, that’s very important.

Lance: [00:19:14] And previously that didn’t exist. So, that’s something we did in 2019. They’re going to take occupancy first quarter of 2020, and, yeah, we’re really proud of that kind of work. So, sometimes our investments are in that realm. Other times were physical investments, either through tax leverage finance or direct investment, and yes, we assume a much higher risk profile than our private sector partners.

Eve: [00:19:35] And have you been able to convince some banks to come along on the ride with you?

Lance: [00:19:39] Yeah. And I think as long as you understand their underwriting criteria, and their approach, they’re great partners. You just have to understand what their sweet spot is and work around it. We underwrite our investments in a very similar way that banks do, on the risk end. The difference being, one, we’re willing to assume more risk. And two, on the return end we think much more broadly about returns. It’s not just about debt coverage ratio. It’s about tax base expansion. It isn’t necessarily going to pay us, but is a return to the project because it’s a mission-based return.

Eve: [00:20:16] It’s a return to the region, right? As well.

Lance: [00:20:17] Exactly. We love working with banks and traditional funders. And we have the ability to be more flexible to allow them to meet their underwriting goals and and still participate in the project.

Eve: [00:20:28] What sort of projects do you hope to see more of? I mean, if things go really well and your investments pay off in the way you want them to. What sort of projects are you hoping to see arise independently in the next five years, let’s say?

Lance: [00:20:42] Yeah, I think if we do a couple of projects like that, that light industrial building in Braddock then … that’s the goal, is that you would then establish a market and I can then start making similar investments in Duquesne and McKeesport. And like I said, you just pull that market down to maybe less centrally located areas. So, yeah, more spec buildings, more high-bay light industrial for robotics industry, more wet lab for biotech and life sciences. You know, hopefully, some of our development community starts to realize that you can stand in Lawrenceville in 40 dollar square foot space and look across the river at 15 dollar square foot space. And …

Eve: [00:21:19] Yes.

Lance: [00:21:21] … start to recognize that arbitrage opportunity. Because these communities, they’re fantastic, unique, beautiful places. They are open to development. They are, you know, they’re wonderful places to do work. And they’re right adjacent to the urban core. So, you know, rethink your idea of proximity and let’s do some great projects in some of these communities that are maybe overlooked in a lot of cases.

Eve: [00:21:47] And then most importantly, it’s pretty fun to be at the leading edge, right?

Lance: [00:21:51] I think so! Sometimes, you know, that’s when you don’t have a comp and the bank starts to get real nervous …

Eve: [00:21:58] I know, I know.

Lance: [00:21:58] … that’s when, you know, they don’t find it as much fun as I do. But yeah. I mean, that’s part of the fun, is there’s additional challenge there, but it can be really, really rewarding if you pull something off.

Eve: [00:22:08] I agree. Totally agree. Yeah. We’ve also talked about how to empower people in these communities to be part of the change, the rapid change that’s occurring in cities like Pittsburgh. And I am wondering why you think that’s important?

Lance: [00:22:23] One of the big challenges we face as a society is disproportionate allocation of not only income, if you look at wealth, right? It becomes even more staggeringly problematic. So, we’re not trying to establish markets for, just because, just for tax base, right? Hopefully, the idea is then, by establishing market you can assist in families building wealth, right? And we want people to be able to participate in the benefits of these hopefully catalytic investments we’re making. How best to do that is a challenge. You know, obviously, it’s easy when you have homeownership, high levels of homeownership, because that’s, you know, your biggest asset that appreciates with change in real estate market.

Eve: [00:23:17] Yeah.

Lance: [00:23:17] If people have that asset and they want to cash out and participate in that upside return, well, great. You know, that’s building equity, that’s building wealth. And hopefully that’s life changing for the family that chooses to do that. I think the problem, because when people are very culturally, emotionally and kind of societally invested, but don’t have that asset to participate in the appreciation, how to plug those people in to our changing communities and make sure that they participate. And that’s where, you know, lots of novel ideas that I think we’ve been talking about, about microlending, and, you know, equity returns back to neighborhoods, start to become really, really compelling for that kind of segment of society and something that I really want to learn more about, and try and institute some really progressive things on that front.

Eve: [00:24:10] I’ve been talking to some people over the last year who also believe that making a space for those people, like a physical space, is really important. And they do that in different ways. Like maybe a community space or … there’s a developer that I know who very purposefully will create retail space and then look for someone in the neighborhood to fill it and really help them build their business into that space. And that, I suppose that’s another very concrete way to involve community and make them feel like they belong, right?

Lance: [00:24:47] Yeah. No, absolutely. Absolutely. And, you know, maybe that’s a, you know, a silver lining on the challenges to retail real estate now is that mixed-use buildings are kind of hoping that’s a break even spot? Right?

Eve: [00:25:01] Yeah.

Lance: [00:25:02] And so what you have is then, is a really affordable commercial …

Eve: [00:25:05] Right.

Lance: [00:25:05] … property for people to move into. You know, locally-owned, sole proprietorship businesses that provide a higher return back to the, to the owner.

Eve: [00:25:17] Yeah, yeah.

Lance: [00:25:17] Hopefully we can continue that.

Eve: [00:25:19] Yeah. And so, like, I have to ask, what’s, you know, your background? You mentioned a little bit about it, but what did you study? What got you to this place?

Lance: [00:25:29] Yeah. I grew up in Pittsburgh, to a … I was the youngest of four.

Eve: [00:25:35] You were the baby.

Lance: [00:25:36] I was the baby and I probably act like it too much. But, you know, my first education was growing up in incredibly hilarious and brilliant family. So, you know, my parents were really hardworking, great people. I went to a mix of public and Catholic schools when I was a kid. I studied finance in Washington, D.C., The Catholic University of America. Went overseas and lived in Turkmenistan for three years, which was arguably the most educative of all of my educational experience. And I came back to CMU to get a policy degree with the intention of going back to do more international development work, because I found it just fascinating. But really fell back in love with my hometown, recognized that there were parts of my city that were in as much need or possibly greater need than what we consider to be some of the, you know, the most poverty stricken places on earth. And that didn’t sit great with me. Yeah, all of those different educational life experiences, it kind of like, let me down this path. And, you know, people, like I said I have had great work mentors that have given me chances to work on stuff. I’ve just been incredibly lucky.

Eve: [00:26:51] I have a feeling it’s not just luck, but we can go with that.

Lance: [00:26:53] I think it’s mostly luck. It’s mostly luck. But yeah, like I say, it goes back to my parents. I do work hard at it because I love it. It never quite feels like work, you know. Some days it does.

Eve: [00:27:04] Yes.

Lance: [00:27:05] Most of the time it doesn’t.

Eve: [00:27:06] That’s great. And do you think on the whole, socially responsible real estate is necessary in today’s development landscape. Outside of the work you do, like everyday developers? What do you think that should look like?

Lance: [00:27:20] There’s crappy real estate development and there’s good real estate development, right?

Eve: [00:27:23] Yes.

Lance: [00:27:24] I think good real estate development is about placemaking, and placemaking is about integration into the community. Not just, you know, from a contextual design standpoint, but from a ‘community needs’ standpoint. And I think enlightened developers get that. Enlightened developers know that incorporating that kind of philosophy in the development usually leads to higher returns, too. So, I think it can be done well and it can be done profitably, right?

Eve: [00:27:52] Right.

Lance: [00:27:52] It just requires a kind of a philosophy, a mindset, and the ability to listen to people a little bit more. But in the end, they have a much better project to show for it.

Eve: [00:28:03] Creating something that’s responsible isn’t really swallowing a bitter pill, right?

Lance: [00:28:09] No, definitely not. Especially when you have your friendly local government economic development person to help you along the way and hopefully chip in where necessary.

Eve: [00:28:20] And are there any current trends in real estate that you think are interesting or most important to the future of our cities?

Lance: [00:28:28] Well, I mean, I think it’s interesting, you know, being the hub of technology that we are. I think the design considerations around places like parking garages, for example, I think are really interesting. Because the rate of technological change is forcing people to consider the fact that this structure could achieve obsolescence in five, 10 years.

Eve: [00:28:52] Yeah.

Lance: [00:28:52] Which, what previously was considered a 50 year asset. So, I find that inherently fascinating.

Eve: [00:28:58] It is fascinating, isn’t it? I just start thinking about, well, what could you do with a parking garage?

Lance: [00:29:04] Yeah, right.

Eve: [00:29:04] How many housing units could you put into those little slots?

Lance: [00:29:08] Precisely. And are they going to be livable, you know?

Eve: [00:29:10] Yeah.

Lance: [00:29:10] And how do you remediate the oil afterward? You know?

Eve: [00:29:12] That’s right.

Lance: [00:29:12] It’s a … it’s a really interesting thing. So, you see people spec-ing in higher ceiling heights than they would have previously. Flat floor plates. All these different design considerations that I find fascinating. And even more fascinating because we’re on the bleeding edge of all of the autonomous vehicle technology that is going to lead to obsolescence of those buildings. So, yeah, I mean, that’s one that I find fascinating. What else?

Eve: [00:29:39] I’m watching zoning changes across the country, and across the world. I’m pretty fascinated to see how quickly that’s going to move along. When you have cities, you know, basically outlawing single family homes. That’s quite a statement.

Lance: [00:29:53] Yes. I think Pittsburgh in particular is being very progressive in some ways with, you know, allowing for accessory dwelling units, which I know you’re probably an advocate for, and …

Eve: [00:30:05] Yeah.

Lance: [00:30:06] … and, you know, what they’ve done with the RIV district, for example, and ensuring access to the waterfront, I think is some really good things. However, in some city neighborhoods, and this gets even more acutely problematic when you move out to maybe smaller municipal governments that haven’t updated their zoning and code in a while. The thing that I find problematic is if you ask the average 10 people on the street what the vision for new development their community would look like? And then you show them what current zoning allows for, they would be horrified, right?

Eve: [00:30:40] Yes, yeah, I think that’s true in most places.

Lance: [00:30:43] It’s a huge disconnect and it’s worrisome to me.

Eve: [00:30:47] Yeah, I mean, how do, you know, it’s really expensive updating a zoning code. I’ve been involved in that. It’s a really big deal.

Lance: [00:30:53] It is. And when you multiply that by 130 municipalities with wide, varying levels of, kind of, capacity. It’s … yeah, it’s really a daunting task.

Eve: [00:31:05] Yeah. And one sign-off question, then. Given all of the possibilities, what comes next for ACED, and for you?

Lance: [00:31:14] I am very project focused. And I believe that markets are built one great project at a time and I try not to let the enormity of the challenges, you know, get me down, right? It’s just one good project at a time. We’re focused on that every day, and we’re focused on being innovative and creative every day. And there are a ton of innovative and creative people in Pittsburgh that we need to partner with and work with to solve these problems. Like I said, it’s all hands on deck.

Eve: [00:31:48] Well, thank you very much. I really enjoyed that conversation. I can’t wait to see what you do next.

Lance: [00:31:52] Awesome. Thank you so much, Eve.

Eve: [00:31:54] That was Lance Chimka. Lance is embracing his role as the head of an economic development department with energy. Our conversation reflects the way that Lance thinks. Broad and diverse ideas to get at very particular economic problems. Lance is focused on growth, first and foremost. Making sure that Pittsburgh’s growth matches other cities. But at the same time, he wants to make sure that no one is left behind. So, he thinks a lot about how to empower communities in the path of rapid change, and how to change the disproportionate allocation of wealth. I’ll be interested to see the impact that Lance’s leadership will have.

Eve: [00:32:46] You can find out more about impact real estate investing and access the show notes for today’s episode at my website, EvePicker.com. While you’re there, sign up for my newsletter to find out more about how to make money in real estate while building better cities.

[00:33:12] Thank you so much for spending your time with me today. And thank you, Lance, for sharing your thoughts with me. We’ll talk again soon. But for now, this is Eve Picker signing off to go make some change.

Image courtesy of Lance Chimka

Public space. The heart of the city.

There are numerous factors that city planners, politicians, developers and designers consider when planning cities; from infrastructure to transit to the creation of residential, commercial and retail space, all to draw new businesses and residents. But often the last thing to be considered, and yet perhaps the most critical component in any city neighborhood, is public space. Parks, plazas, walking and bike paths and even wide, strollable sidewalks all play an integral role in connecting communities and giving people a sense of belonging.

In a recent podcast interview with Eve, former Pittsburgh Mayor, Tom Murphy, reflected on some of his administration’s big wins in revitalizing the city of Pittsburgh, as well as some missed opportunities. In his post-mayoral career, Mayor Murphy regrets not putting public space front and center.

Turnaround mayor

Tom Murphy served as Pittsburgh’s major from 1994 to 2006, a turbulent and transformative time for the city. He took over the reins of the city when it was decimated by a loss of the steel industry and out-migration of over 50% of its population. During his tenure Tom created a $60 million development fund to jump-start development in abandoned neighborhoods, built two new waterfront stadiums, and developed many miles of river trails. At the end of his tenure, he had presided over a remarkable urban comeback story, and the city has been transformed in a myriad of ways.

At the heart of Murphy’s plan to revive Pittsburgh was the purchase of 1,500 acres of land for new development. This gave the city a chance to create effective public-private partnerships with developers to restore struggling parts of the city, all the while luring new businesses to the region and encouraging others to stay and grow.    

Planning for public spaces

Murphy strongly believes that a sense of “place is everything,” and can have a huge impact on the quality of peoples’ lives. He notes that in addition to the large-scale developments his administration sponsored, they were also able to also rebuild all of the city’s 100 or so neighborhood parks, both small and large, all while involving the local communities. But he is quick to add, that although their instinct was right, they should have gone further, expanding the city’s park system instead of just rebuilding it. Some neighborhoods that have long lacked communal gathering places would have benefitted from the creation of wonderful new plazas.

Reflecting on his experiences in Pittsburgh, and as a frequent visitor to cities all over the world in his role as a Senior Fellow at the Urban Land Institute, Tom has come to believe that an even a stronger sense of community can be encouraged through the use of public space, whether it’s a playground or a park. He wonders how you can thoughtfully connect people in a neighborhood so that they feel a sense of belonging to the place. He believes that “if people feel rooted in their neighborhood, … they’re willing to put up with a lot of problems if they see themselves and others committed to wanting to making it better.”    

Getting communities invested

Public spaces are crucial for building successful cities. They help to bring communities together and invest people in their neighborhoods, regardless of background or income. Amidst lucrative development plans, it can be easy to overlook the importance of public space, but as Murphy notes, city government and local communities can and should work in partnership with developers to make sure public space is at the forefront of every new development and planning project.      

Listen to the full interview with Tom Murphy to hear more about his vision for public spaces and the role that public space plays in building better cities.      

Artlumiere light projections ’09 courtesy of Jonathan Greene

A bold experiment in coal country.

Brandon Dennison founded Coalfield Development in 2011 to offer a unique workforce approach focused on transforming communities – a bold experiment in tackling the generational poverty West Virginia has long wrestled with.

This experiment grew out of his early memories while growing up in a comfortable middle-class family in West Virginia. Others were not so fortunate. West Virginia’s jobless rate is high. But Brandon noticed that people wanted to find work, even if only through odd jobs, and this memory stayed with him. While still at school, Brandon developed a business plan for Coalfield Development, the first step towards launching the nonprofit which is focused on countering the generational poverty and lack of economic opportunities in West Virginia.

Coalfield’s workforce model is called 33-6-3: 33 hours a week are spent in on-the-job training, along with participation in training workshops; six hours a week are devoted to community college and business classes for an associate degree in applied sciences; and three hours a week are committed to personal development coaching and life skills. 

Coalfield has since expanded into a family of small, social enterprises. Revitalize Appalachia is developing a green-collar workforce deployed on projects that include rejuvenating empty buildings, and which was pivotal to starting Solar Holler, southern West Virginia’s first solar installation company. Refresh Appalachia produces fresh, healthy, local food. Reintegrate Appalachia is part of a region-wide coalition to support people in recovery from drug addiction on the path to finding employment. And Reclaiming Appalachia Coalition is a multi-state network exploring more innovative, sustainable approaches to mine-land reclamation.

On the development side, since 2013, Coalfield Development has incubated two wood shops, a coffee shop and an antique mall. In addition to a 2019 Heinz Award, Coalfield was recognized in 2018 with a $1 million grant from the Rockefeller Foundation/Chan Zuckerberg Initiative to replicate their model in Appalachia. 

Insights and Inspirations

  • Brandon believes that the American small town is poised for a comeback.
  • He is most proud of the deep human development his programs deliver, where participants move from hopelessness to optimism and confidence.
  • Real estate projects tackled by Coalfield Development do much more than deliver a building. They house new enterprises, create jobs, and train people in a multitude of skills.

Information and Links

  • Refresh Appalachia is turning coal mines into farms.
  • Solar Holler is pursuing innovative approaches to bring solar within reach of people and places who have always been left out.
  • Revitalize Appalachia builds community-based construction projects along with on-the-job training. Crews are local and projects are green.
Read the podcast transcript here

Eve Picker: [00:00:08] Hi there. Thanks so much for joining me today for the latest episode of Impact Real Estate Investing.

[00:00:15] My guest today is Brandon Dennison, a young creative powerhouse working to bring an economy to mid-Appalachia. As a young adult, Brandon noticed the poverty and lack of jobs in the town he grew up in. That early memory stayed with him through his college years. While still at school, he launched Coalfield Development, which is focused on workforce development to counter the generational poverty and lack of economic opportunities in Western Virginia. While workforce development is the center of Brandon’s focus, that has also spilled over into creative, sustainable and community-centric real estate development. Brandon’s work has been recognized with a Heinz Award, and a $1 million grant from the Rockefeller Foundation/Chan Zuckerberg Initiative. You are going to want to hear all about it.

[00:01:24] Be sure to go to EvePicker.com to find out more about Brandon on the show notes page for this episode. And be sure to sign up for my newsletter so you can access information about impact real estate investing and get the latest news about the exciting projects on my crowdfunding platform, Small Change.

Eve: [00:01:58] Thanks so much for joining me today, Brandon.

Brandon Dennison: [00:02:01] Happy to be here. Thanks for having me.

Eve: [00:02:03] So, we are rebuilding the Appalachian economy from the ground up. That statement is front and center on the home page of Coalfield Development, the organization you founded and lead. Well, I’d love you to tell me exactly what that means.

Brandon: [00:02:20] Well, it is a bold statement. There’s no doubt about that. And we are trying to model and pioneer what a whole new and better and fairer and more sustainable economy can look like for our region. This is a region that’s been overdependent on coal for far too long and that overdependence has left us economically vulnerable. It’s also left our environment in a difficult situation, not as clean as it should be and it’s hurt, it’s ultimately hurt the fabric of our societies and our communities, as you can see with the growing opioid and addiction crisis that we’re in. So, at Coalfield, we know that we can’t re-employ every single unemployed person that’s out there in Appalachia, but we can model what a newer and better way of doing things can look like.

Eve: [00:03:13] So, you know, what does that modeling look like? Have you developed programs? What are you working on?

Brandon: [00:03:18] Yeah. So, we incubate, mostly from scratch, but also in partnership with other entrepreneurs, we incubate what we call social enterprises. These are business models that blend the compassion of the nonprofit world with the efficiencies of the for-profit world. And the enterprises are in new sectors of the economy where we can innovate and show what a more sustainable economy can look like. So, for example, we’ve helped start the first solar installation company in southern West Virginia. We have an organic agriculture company. We make t-shirts out of recycled plastics. We make wood furniture out of reclaimed lumber from dilapidated buildings, some very innovative businesses. And we use those businesses to put people back to work, and then to support their lifelong learning and development.

Eve: [00:04:06] And so how many businesses like that have you developed to date?

Brandon: [00:04:09] From scratch, we’ve helped start 11 new social enterprises that we own and operate. And then we’ve also invested in more than 50 other social enterprises throughout the region.

Eve: [00:04:21] That’s a lot. That’s over 60, already.

Brandon: [00:04:25] Yeah.

Eve: [00:04:26] And so that creates a lot of jobs. How many jobs have those enterprises created?

Brandon: [00:04:32] We’ve created more than 250 new jobs. And those are permanent positions. And we’ve trained over 1,000 people through our training programs.

Eve: [00:04:41] That’s that’s pretty amazing. So, tell me a little bit about the programs that you’ve developed, as well.

Brandon: [00:04:47] When we hire a person onto these social enterprises, we hire them according to what we call our 33, 6 and 3 model. This is how we organize the work week, 33 hours of paid work each week, six hours of classroom time. All of our crew members are working towards an associates degree at the local community college. And three hours a week of personal development, which is, essentially, it’s life stuff …

Eve: [00:05:15] Yeh.

Brandon: [00:05:15] … to help our people overcome the challenges that are getting in the way of their quality of life. So, it’s a very holistic model. And what we found is, whether it’s in agriculture or construction or manufacturing, the model’s replicable across different sectors of the economy.

Eve: [00:05:31] So, you’re also providing, I think, a lot of support services in a variety of programs, like you, you say you train people. How do you do that? What resources you provide them with?

Brandon: [00:05:43] So, this is a paid experience. The 33 hours, it’s paid work, it’s a real job. And then we do a scholarship for the “6” and the “3,” so none of our college students have student debt. And then we layer on some additional life support. We have a zero interest emergency loan program that folks can tap if they have an unexpected emergency. And we facilitate a personal development program, which is really its reflection, where part of those three hours we’re creating time for folks to really evaluate where they’re at in life, and sometimes for the first time, assess a future and how to attain that future.

Eve: [00:06:22] So, it sounds like you have a huge amount of support, I think you’re just probably telling me little pieces of it, for a lot of people. And what impact has that had? I mean, how are you measuring success? What does that look like to you?

Brandon: [00:06:40] Well, there are some easy ways to do that. And then there are some deeper ways to do that. What excites us is really the deep human development. When we see a person who’s been able to calm chaos in their life, and they’re now able to develop a life plan and goals and start to achieve those goals, and start to have a quality of life they never thought attainable. That’s why this organization really exists. So, we measure our success by jobs created, and businesses created, and people trained. But then we also, internally, every crew member has a monthly evaluation by which we track their professional development. And then every week we also have a personal reflection which actually monitors and tracks the improvements in the well-being of the person themselves. So, we can measure this through peer-reviewed surveys on things such as optimism and self-confidence and sense of self-agency and self-worth. And that’s harder to measure. but that’s really the magic of this organization, I think, are those deeper human, really, transformation is not too strong a word for what we see happen in people’s lives. We’ve seen people go from struggling with addiction to, all the way to becoming entrepreneurs. Folks who have been couch surfing and homeless to first time homeowners and opening savings accounts. So, I don’t think transformation would be too dramatic a word.

Eve: [00:08:10] No, absolutely not. That’s pretty remarkable. Tell me, how does real estate development fit into your model?

Brandon: [00:08:19] Yep. So, we have a niche with real estate where we take on older historic buildings. We use our locally hired construction crews to revitalize those buildings into mixed use, mixed income hubs for economic development. So, what I mean by mixed use, there’s usually an affordable housing component. We do the housing green and sustainable upstairs, and then downstairs there’s usually a small business component where we’re creating new space for new businesses to come into the communities. New social enterprises to open up shop. And then by mixed income, you know, we’re creating assets that are really accessible for people of all different incomes. And so, the real estate component really supports the personal development and the enterprise development strategies that we’ve already talked about. And it’s important for gaining community trust because it’s so tangible. I think sometimes there is a lot of cynicism down in southern West Virginia. There’ve been so many government programs and mission trips and charitable efforts that folks have become really skeptical about what it actually means for their lives. I think part of the reason our real estate component is so popular is it’s tangible. People see an empty building coming back to life. They see their neighbors moving in there, having a great place to live. They see new businesses opening and putting people to work. And it’s hard to deny that positive momentum.

Eve: [00:09:44] Yeah, that’s true. I think real estate is pretty fabulous that way. It’s sort of visible proof of change, right?

Brandon: [00:09:50] Yup, exactly.

Eve: [00:09:51] Yeah. How many projects have you completed?

Brandon: [00:09:55] I would have to add that up, exactly, but I’d say at least about a dozen. We have another three or four in our in our pipeline, right now.

Eve: [00:10:03] And your role in these projects, are you the developer, or do you help someone else who’s developing the project?

Brandon: [00:10:11] We are almost always the developer. So, we have the competency as an organization to put the finances together, to lead the community engagement, the community visioning. We’re usually the contractor. We’re a licensed general contractor. So, that creates local jobs through which we can use that 33, 6 and 3 model that I referenced earlier. Sometimes we’re the owner and manager, but not always.

Eve: [00:10:35] So, I have to ask if there’s something you don’t do?

Brandon: [00:10:40] (Laughter) That’s a fair question.

Eve: [00:10:41] Because you’re rattling off, like, an extraordinary number of accomplishments, and I’m sure there’s more tucked away that you’re not talking about.

Brandon: [00:10:48] So, I studied nonprofit management in graduate school, so I know the term “mission drift” and it’s always a concern. But kind of our theory of change for southern West Virginia is that things had gotten so stagnant and so, sometimes hopeless feeling, that what was needed were really were some bold experiments. And that it wasn’t enough to just pick one area and say, this is what we do and this is all we do. And so, we are into a lot of different things, but it’s actually kind of on purpose.

Eve: [00:11:19] Yeah, it sounds like you’re pretty happy about it, too, Brandon.

Brandon: [00:11:23] Yes. Because of those transformations, that I realize, it’s hard not to wake up excited about what we’re doing. This is where I’m born and raised. So, I love this place. I’m committed to this place. And to get to see people transform their lives and communities transform, you know, literally empty buildings transformed into new places of business. It’s inspiring to be a part of it.

Eve: [00:11:46] So, let me let me ask you, are you working in one town, city, or are you working all over the state?

Brandon: [00:11:55] We have partnerships all over the state now, and even a few outside of our state borders. But most of our work is focused in southern West Virginia, kind of near the Kentucky border.

Eve: [00:12:07] Okay. And tell me again what sort of problems? You, I know, there’s an opioid crisis, I mean, what sort of unemployment are you dealing with there? What’s happening economically in that part of the state?

Brandon: [00:12:21] Well, I’ve had to learn the hard way the difference between generational poverty and circumstantial poverty.

Eve: [00:12:28] Yeh.

Brandon: [00:12:28] Circumstantial poverty, you have folks who have had stable income, have had good jobs and lose those jobs, and it is very scary. But there’s kind of a base or a foundation for them to rebuild off of. Whereas, with generational poverty, you’ve got several generations gone by without wealth and assets accumulating. And it’s just a deeper, more complex sort of challenge. And that’s the kind of challenge we’re facing in Central Appalachia and have been for generations. And so, that’s why our work goes so deep and long. You know, we’re creating actual jobs. These are two and a half year contracts. We’re sticking with people all the way through the end of their associates degree, which is, usually takes two and a half years. So, it’s more expensive, it takes longer, but it’s what’s required, given the complex generational challenges we’re staring down.

Eve: [00:13:20] What is unemployment like there?

Brandon: [00:13:23] Unemployment is, it’s always above the national average. But what actually stresses me out even more is the labor participation rate. Unemployment measures people who are out of the workforce, but are actively trying to get back into it.

Eve: [00:13:36] Right.

Brandon: [00:13:36] Whereas labor participation, that measures the number of folks who are trying to be in the workforce versus those who have totally given up. And we have a lot of counties where less than 50 percent of the working age population is in, actively in the workforce. And that, frightening. You can’t build a modern, healthy economy with a number like that.

Eve: [00:13:56] No. So, then what is your and your organization’s long term goal? What do you hope things will look like in 10 years?

Brandon: [00:14:03] This is why we’re so committed to starting new businesses ourselves. It’s not enough to just train a workforce for the businesses that exist because there’s just not enough economic activity happening right now to really build an economy for the future. And so, this is why the startup component of our work is so important.

Eve: [00:14:24] Yes. So, out of everything you’ve done, what do you think’s been most successful and perhaps what’s been least successful?

Brandon: [00:14:32] Well, one of our social enterprises was a coffee shop in a small town in southern West Virginia that we were very proud of. It was in a formerly vacant building. It was a beautiful project. It filled a need and a gap that wasn’t being met in the community. The idea for the coffee shop came out of community charrettes, But ultimately the coffee shop, it just didn’t make it financially. And I think what that reinforced for me, you know, retail businesses are going to struggle until we’ve rebuilt that economy to have outside investment coming in, to have businesses, like manufacturers or construction companies that really generate a multiplier effect, it’s gonna be tough for a retailer-type businesses to take hold. So, it was so sad to close the coffee shop, but we learned so much from that. And on the success side, I mean, I think of the human beings whose lives have transformed, the 250 new jobs that we’ve created. And ultimately, what those people as part of social enterprises have achieved, is they’ve modeled what a whole new and better economy can look like, especially when you think about that solar company.

Eve: [00:15:41] Yes.

Brandon: [00:15:41] To think that we’ve grown a solar installation company. It’s totally for-profit now. No grant money needed. We did that right in the heart of coal country. That’s a pretty bold accomplishment.

Eve: [00:15:51] That’s pretty bold. Yeah. Just going back to real estate a little bit.

Brandon: [00:15:56] Sure.

Eve: [00:15:57] I’ve done this sort of real estate project myself, and I’m wondering how you fund your projects.

Brandon: [00:16:03] It’s always a mix. We never like to do a project that can’t sustain at least some debt. You know, we feel like if it has to be 100 percent grant-funded, that’s probably not a good sign that it’s viable. And yet in our distressed communities, to expect a property to handle 100 percent debt service is not fair either.

Eve: [00:16:23] I don’t think you can expect that in too many places anymore, so, especially if you’re trying to build affordable housing where, you know, affordability depends on keeping debt down. So, it’s very tough. Yeah.

Brandon: [00:16:36] So, we almost always have a bank loan that, anywhere between 10 to 20 percent of the projects, sometimes more. And then we fundraise. And for the housing piece, the Federal Home Loan Bank of Pittsburgh has been a fantastic funding partner for us. And on the commercial side, we’ve had some good luck with the United States Economic Development Administration.

Eve: [00:16:59] Ok, creeping up to 40 percent would be a good thing, right?

Brandon: [00:17:03] Yeah.

Eve: [00:17:04] Yeah. I think given in Pittsburgh, projects that are in underserved neighborhoods typically need, maybe 40 percent of subsidy, and the market’s gotten pretty strong here. So, it’s very difficult. What you’re doing is very, very difficult. And what role does the community around you play in the funding of these projects?

Brandon: [00:17:24] Part of the problem with the generational breakdowns that I was referencing earlier, that means there’s not been an accumulation of wealth over the generations. And so we do not have a philanthropic base like what many urban areas have.

Eve: [00:17:40] Right.

Brandon: [00:17:41] Our local community foundation can really only do grants of five to ten thousand a pop. One in Charleston that can do a little bit better. So, we are really forced to look to the public sector for funding help and we’re forced to look outside of our region for folks who understand the oppression and the divestment that’s happened here, and are willing to help us try and rebuild a stronger base.

Eve: [00:18:06] Yes. So, that brings me to the question. You know, I have an equity crowdfunding platform. Do you think that could play a role in building communities for everyone where you work?

Brandon: [00:18:16] I think so. I think it’s a brilliant model. And I think, you know, to answer your question more directly from before, about the role of the community, what makes our projects really go is this the sense of community ownership. So, we start every project with multiple community town halls, and charrettes, and the community members actually sit down with the architects and help design these projects. So, we often times, even though Coalfield is technically the owner and the developer, there is a wide sense of connection and ownership to these buildings from community members themselves. And so I think that sort of approach that we take might very well make us a good fit for your crowdfunding approach.

Eve: [00:19:00] What community engagement tools have you use that have worked best?

Brandon: [00:19:05] We used to start with a charrette right out of the gate. We realized the charrettes go better when there’s more knowledge built up of the history of the building, and what’s possible and what’s not, given the funding source. And so, we start with the town hall, sometimes two or three, just to build the awareness of the history of the building and the funding sources at play.

Brandon: [00:19:26] Then we have a charrette, and sometimes more than one charrette, to actually let the community members sit down with the architects and have their fingerprints on the actual blueprints for these projects. And then we continue to engage the community once the properties are up and running. We hire local community members to staff these facilities. And we continue to lead community engagement efforts well into the future operations of the buildings.

Eve: [00:19:52] So, community engagement from beginning to end, right?

Brandon: [00:19:56] Yeah, absolutely.

Eve: [00:19:58] Going back to you. I’m just wondering what your background has been that’s led you down this path, creating this pretty amazing organization.

Brandon: [00:20:06] I was born and raised in southern West Virginia. I had a happy middle-class upbringing, but I knew all around me there was a lot of pain and suffering. I went away to school about six hours east of here, and I got very involved with a progressive Presbyterian church. I loved the youth group and I would take the group on service trips, all over, mainly to learn and to do a little bit of service. And I had some amazing experiences, but everywhere I went, I felt like, where I belong was back home in my own backyard because I knew that’s where I could probably have the biggest impact. I understood that place the most. And then the very last service trip I led was to Mingo County right back in southern West Virginia. And we had this experience where we were doing service work on a house. And these two young guys approached us and they had tool belts slung over their shoulders, and they asked us if we have work available. And I explained we were volunteers, and they went on their way, and it was just a brief, brief interaction. But I felt like that brief moment really summed up the situation in southern West Virginia, which is, we have people who want to work and want to learn and want to be a part of something, but our economies stagnated so badly that there’s nowhere for that gumption to really be applied. So, that was the seed that really started me thinking about Coalfield Development.

Eve: [00:21:30] And then after that, how did you get it off the ground?

Brandon: [00:21:33] I went to graduate school to study nonprofit management with the Indiana University. I knew that I wanted to move back home but Indiana had a great program. And while I was there, the business school actually was helping start this new program in social entrepreneurship. And that was a phrase I’d never heard before, but it really caught my attention. The more I learned, the more I felt like, here was something different, and new and potentially more effective than some of the other public and nonprofit programs that have been tried back home. I had an internship in the summer of 2010 to kind of listen and learn. And then I took the whole second year of graduate school and just threw myself into the business plan for Coalfield Development. And then I, when I was done with school, I moved back in with Mom and Dad and they gave me financial cover and shelter to make a try at this thing.

Eve: [00:22:26] (Laughter) Very good. Have you moved out? I have to ask.

Brandon: [00:22:30] (Laughter) I did finally make it out. I’m married and we have two boys now.

Eve: [00:22:34] Thank goodness. Your parents are probably saying thank goodness too. Right?

Brandon: [00:22:38] Yeah, probably so. It’s kind of, like, the millennial thing to do, you know. (Laughter)

Eve: [00:22:42] It’s a very millennial thing to do. Really. It’s been a tough 10 years, right?

Brandon: [00:22:49] It has been.

Eve: [00:22:49] So, then, do you think socially responsible real estate is necessary in today’s development landscape?

Brandon: [00:22:56] I think it’s critical and I think it’s too often overlooked. You know, we organize our organization by what we call three core capabilities. It’s the personal professional development. It’s the incubating of the social enterprises. And then it’s the community based real estate. And the community based real estate in many instances is what’s making the first two possible. You know, it can be complex. There’s many different funding sources. It takes years for these projects to get pulled off. And so sometimes it’s not the easiest … kind of sexiest piece of our work to talk about. But it’s a critical component.

Eve: [00:23:31] Yes. Yep. And are there any current trends in real estate development that interest you the most that you think could be relevant, too?

Brandon: [00:23:39] Well, I think the American small town is poised for a comeback. Rural has challenges, but I think more and more, people are looking for a good quality of life. They’re looking for outdoor recreation opportunities and clean air and clean water and peace and quiet. And with some historic buildings. When you think about sustainability, I think, historic preservation gets overlooked. But one of the best things we can do to build new housing in a sustainable manner is to preserve our current building stock rather than knock it over and put it all in a landfill. So, I think there, the future of the market might be good for rural small towns. I hope so.

Eve: [00:24:18] Yeah, I think you’re probably right. I was in Australia recently and I travelled to Hobart, which is in Tasmania, to the south of it. And it was fascinating because Melbourne is the closest city to the north and it’s one of the most expensive cities in the world and growing really, really quickly. But it was this tiny little city. I hesitate to call it a city, it’s very small. And it had really had a huge influx of young people who were experimenting, and building businesses in exactly the way you’ve described. Just trying to, kind of, build up a new place for themselves where they could afford it. It was pretty dramatic.

Brandon: [00:24:59] Very cool.

Eve: [00:24:59] Yeah, very cool. Yeah.

Brandon: [00:25:00] I think that’s the future.

Eve: [00:25:01] Yeah. I think, you know, people have to find their way out of some of our cities which have become just too expensive for most people. How do we think about our cities, towns and neighborhoods so that we can build better places for everyone?

Brandon: [00:25:17] I think historic preservation, again, is a key part of that conversation. I think that mixed use, mixed income projects are important. The reason the mixed income, you know, if you look at affordable housing development in years past, it’s often, it’s taken low-income people and shoved them in a corner of the city and kind of consolidated all the challenges that come with poverty. It really cut people out of pathways and avenues and access to opportunity. The mixed income is important, and the mixed use is important as well, so that we’re not just creating affordable housing, but really, we’re building up communities that include small businesses and recreation opportunities and community engagement opportunities that contribute to a whole quality of life.

Eve: [00:26:07] So, I think basically you’re saying we should just keep mixing it up, right?

Brandon: [00:26:11] I think so.

Eve: [00:26:12] Just mix it up. Well, thank you very, very much for your time. I really enjoyed talking with you and all the best for this pretty fabulous organization that you’ve built.

Brandon: [00:26:22] This was a great conversation. I love the work that you’re doing as well. And I hope we can find a way to work together.

Eve: [00:26:28] Absolutely.

That was Brandon Dennison of Coalfield Development. Brandon measures success in the lives he helps to transform, from poverty stricken and jobless to optimistic and confident. Each participant in the 33-6-3 program that he developed works for 33 hours, studies towards an educational degree for six hours, and works on personal development for three hours, each and every week. While workforce development is the center of Brandon’s focus, that has spilled over into creative, sustainable and community-centric real estate development as well. Historic preservation, community engagement and job creation all come together in a very holistic real estate development program.

Eve: [00:27:30] You can find out more about impact real estate investing and access the show notes for today’s episode at my website, Eve.Picker.com. While you’re there, sign up for my newsletter to find out more about how to make money in real estate while building better cities. Thank you so much for spending your time with me today. And thank you, Brandon, for sharing your thoughts with me. We’ll talk again soon, but for now, this is Eve Picker signing off to go make some change.

Images courtesy Brandon Dennison, Coalfield Development.