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Big change for Small Change.

SmallChange.co Expands, Welcomes Five Partners With Expertise in Regulation Crowdfunding

PITTSBURGH – March 6, 2024 – SmallChange.co, an investment crowdfunding platform focused on real estate development with social impact, has expanded significantly with the addition of five partners. All have extensive experience in regulation crowdfunding: Their track record includes the establishment of Common Owner, a Buffalo-based crowdfunding platform with a specialization in real estate.

The five include Julian Anjorin, a serial entrepreneur with a strong background in cybersecurity; Derek King, who specializes in historic preservation; Richard Rogers, an urban planner and attorney; Mitchell Skomra, a software engineer; and Jacob Walsh, who has substantial experience in operations management. All are based in Buffalo except for Anjorin, who lives in North Carolina.

Anjorin will oversee web development and support for the Small Change platform and business applications used for operations. King will focus on early-stage business development, with a primary emphasis on real estate developers and pipeline partners.  Rogers will assist issuers with structuring their offerings, review and negotiate contracts, and handle a variety of compliance functions. Skomra will work with Anjorin on web development, and Walsh will guide issuers through the onboarding process and manage the company’s books.

“Reg CF platforms for real estate are thin on the ground, but Small Change has been growing rapidly,” says Eve Picker, founder and CEO. “Julian, Derek, Richard, Mitchell, and Jacob are joining us at a pivotal time. They are bringing additional resources, deal flow, and a lot more brain power, all of which will help us to accelerate speed to launch and greatly expand our offerings and support for developers and investors alike.”

She adds: “They are committed – as I am – to bringing equity to the world of equity. And they have the skills and experience to turn this commitment into serious progress in the real estate industry.”

“We love the potential of crowdfunding as much as Eve does,” says Anjorin. “It provides opportunity for those who may not have access to traditional banking channels for finance and allows developers to access capital through Reg CF. The world is not fair, and it probably won’t ever be, but we’ll be damned if we don’t try to balance the financial scales a bit. We’re going to make sure that Small Change evens them out.”

About Small Change

SmallChange.co has helped 47 developers raise more than $13 million for projects in 26 cities, big and small, across the United States. SmallChange.co uses its proprietary Small Change Index™ to  measure a broad array of factors to determine the project’s social impact with the goal of creating more affordable, more equitable and more innovative communities. To date, 62% of the deals funded via the Small Change platform have either a minority and/or female sponsor, and all of them score above 60% on the Small Change Index.  Additionally, 68% of the mixed-use or residential projects listed on the platform have included affordable housing, and almost 90% have been located in underserved communities.

For more information on SmallChange.co, please visit www.smallchange.co or email [email protected].

Media Contact:
Rachel Antman, Saygency
[email protected] or (212) 362-5837

NSSC Funding Portal, a SEC registered Funding Portal and member of FINRA, offers investments under Regulation Crowdfunding or Title III, per Section 4(a)(6) of the Securities Act. These investments are offered to everyone 18 or over.

This is not a solicitation of an offer to buy or sell any securities. The projects illustrated above may not be indicative of all projects on the platform. All investing is risky and includes the risk of loss. Securities are subject to liquidity risk and cannot be easily converted to cash. *Past returns do not guarantee future returns. If you are interested in learning more, please visit Small Change for educational material and detailed offering information. You can always say [email protected].

Image by Ivanka Nikitovic via Vecteezy.com (modified)

El Centro Home.

✅ Revitalization. Repurposing a vacant property into a school designed to enhance learning

✅ Minority project partner. Latino-owned firm providing development support

✅ Workforce training. A path to success for students disengaged from high school

✅ Community. 200 students yearly, the majority local residents

✅ Job creation. 50 construction jobs plus 20 permanent jobs

✅ Construction underway. Completion anticipated soon

These features are all packed into just one real estate project in Philadelphia – El Centro Home.  And the developers are looking for investors, small and big alike, on Smallchange.co.

This is not a solicitation of an offer to buy or sell any securities. All investing is risky and involves the risk of total loss as well as liquidity risk. Past returns do not guarantee future returns. If you are interested in investing, please visit Small Change to obtain the relevant offering documents.

Image courtesy of El Centro Home

For the love of the building.

Growing up in a middle-class household in suburban New Jersey, Mark Winkelman decided at an early age, with the encouragement from his interior designer mother, to pursue architecture. To that end he attended and graduated from the Syracuse School of Architecture in 1978. Upon graduation he interned in Phillip Johnson’s highly acclaimed design firm in New York City. While in Johnson’s office he worked on a number of notable high rise office buildings including the gothic PPG Headquarters in Pittsburgh and the iconic postmodern AT&T headquarters in New York City.

After earning his New York State architectural license Mark and his then girlfriend (and now wife) traveled to and worked in Tokyo, Japan for two years. There he came to appreciate the refined visual aesthetic that is uniquely Japanese. The design lessons learned in Japan would deeply inform and influence Mark’s own design work. Perhaps the most important lesson was grasping the importance of putting new work in an historical context.

Upon returning to the States in 1984, Mark partnered with a Syracuse classmate and formed Downtown Design — a boutique architecture and interiors firm based in New York City. For the next 25 years Downtown Design grew and developed a number of specialties including the design of technical media facilities such as recording studios and video edit suites. The firm’s projects also included the restoration and adaptive reuse of historical loft buildings in the creative neighborhoods of Soho and Tribeca in Manhattan. Indeed, one of the loft projects was his family’s own home in a 1894 spice warehouse.

In 2007, Mark and Suzanne bought the complex of historic and vacant factory buildings in Williamsport, PA. According to Mark, the building and their potential was enough to bring him to Williamsport. The Winkelman’s have honored local history with the name “Pajama Factory” and the continuing restoration and preservation of the 100 (plus) year old buildings. According to local history, Weldon’s Pajama Factory was once the largest pajama factory in the world. The site was scouted and used as a model for the 1950’s Broadway play, later the movie, “The Pajama Game,” starring Doris Day and John Raitt. They pondered how to fill the 300,000 sq ft of floor area in a town that has been losing businesses and population for decades.

The Winkelmans opted for a plan much like the one highlighted in Richard Florida’s book “Rise of the Creative Class” that included a mixed-use complex with a 24/7 urban lifestyle which includes live / work lofts, work only studios, supporting retail shops, and community facility spaces. A haven for creative thinkers and incubator businesses was created. Performance and event spaces are available for music, political events, large meetings, tenant / community events. A community outreach, 501-c3, organization which has a well-equipped wood shop, clay studio, bicycle recycle shop, and photography dark room — all of which were brought into the mix by the Winkelmans and are open to the wider community.

Mark strives to maintain a high level of energy and optimism in order to build a Creative Community that will someday serve as a model for the Arts World and for energizing small cities and towns. The adaptive reuse of a building into a mixed-use facility is an established practice in big cities but it is not often seen in towns and smaller cities. The fact that the Pajama Factory located, as it is, in a small city, is beginning to have an outsized and positive effect on how the City of Williamsport perceives itself. Mark and Suzanne understand the importance of being a part of a community-based economy by providing spaces where locally owned small businesses can be developed and benefit from the “Buy Local” movement. The rents are kept incredibly affordable at about 1⁄2 the local rate and 1/10 the rate in New York City, for instance. In his spare time, Mark managed the restoration of his 1970 Triumph GT6 British sports car. He loves sailing, especially blue water cruising. Ceramics, primarily wheel work, is a passion. He also loves traveling with his family — as long as his daughter and son take care of all the arrangements.

Read the podcast transcript here

Eve Picker: [00:00:05] Hi there. Thanks for joining me on Rethink Real Estate. For Good. I’m Eve Picker and I’m on a mission to make real estate work for everyone. I love real estate. Real estate makes places good or bad, rich, or poor, beautiful, or not. In this show, I’m interviewing the disruptors, those creative thinkers and doers that are shrugging off the status quo in order to build better for everyone.

Eve: [00:00:41] After a successful career in architecture and design in New York City, Mark Winkelman purchased a 300,000 square foot historic pajama factory. Once the largest pajama factory in the world, the building sat vacant in a small town in central Pennsylvania with a population of just 114,000. The Winkelmans set about filling it one corner at a time with a vision for an affordable and thriving creative hub. 16 years later and 60% complete, the stunning buildings are coming back to life. But there is still more to do. What was Mark’s motivation and what was his thesis and how has it played out? Listen in to learn more.

Eve: [00:01:37] Hello, Mark. It’s great to have you on my show.

Mark: [00:01:39] Good to be here.

Eve: [00:01:40] So the pajama factory, once the largest pajama factory in the country, now belongs to the Winkelmans. You and your wife, Suzanne, which is really a very bold move. How did you stumble upon the pajama factory?

Mark: [00:01:56] I had a partner, I had a bar stool buddy of mine who was a fantastic, is a fantastic woodworker, and he got involved in some real estate in New York City, and I helped him out as an architect. So, we got to know each other and then he lost his interest in New York and moved out to a nearby town, Bloomsburg, with his woodshop and somehow discovered the building. And ultimately, he sold it to me. He knew I was interested in expanding my architectural practice, if you will, to really own and develop a building or a space or become a developer. So, anyway, he sold me the building, in a sense, and I mean, it’s crazy. It’s in the middle of Pennsylvania. I knew nothing about Pennsylvania. I got as far as the Delaware Water Gap, which is a nice place to canoe and hike on the Appalachian Trail but that’s about 200 yards into Pennsylvania. And Pennsylvania is a huge state. So anyway, we saw the building, found the building and the building, I mean, if it was in New York, it’s just…

[00:03:13] It would be worth a fortune. Yeah.

[00:03:15] Oh, yeah. And unattainable for me to work on. But here we bought it for nothing because nobody wanted it. I mean, literally a penny on the dollar compared to New York. It didn’t really know what to do with it, except that it had potential. It had all potential.

Eve: [00:03:31] The town it’s in is called Williamsport, right? Williamsport.

[00:03:34] That’s correct.

[00:03:34] And it’s pretty well Central PA. Central North?

Mark: [00:03:37] North Central PA. It’s an hour and a half from Harrisburg, the capital. The closest town is Elmira, New York. You know, it’s …

Eve: [00:03:49] So New York is about a three-hour drive. Pittsburgh’s a 3- or 4-hour drive. Toronto’s a three-hour drive. It’s kind of in the middle of, really in the middle.

Mark: [00:04:00] All the locals here say it’s in the middle, middle of the universe. And I actually call it the middle of nowhere because it’s quite removed and there’s no public transportation. There are challenges but the thing I ultimately like about Williamsport is the fact that it’s isolated. And because it’s isolated, everything is here. And my only experience in the past was suburbia in New Jersey, which is where I grew up, which was vacuous. And New York City, which is exciting. It has everything, but ultimately it becomes very inconvenient. Everything is so convenient in Williamsport. They have a steel industry down the street that produced the beams for the new Tappan Zee Bridge. Huge industry. Right up the street we have a precast, small precast company. And I literally had some pieces precast for the building and dragged them back here on a wagon. You can’t do that in New York, you know. That’s been a remarkable kind of revelation to me. I came here for the building. I came here for the challenge of restoring this historic building. I didn’t care about the town, but I’ve come to really appreciate the town and its surrounding. In fact, we moved out here. Suzy and I have moved out here. And our daughter’s moved out here.

Eve: [00:05:25] And I’ve been lucky enough to see it. It’s wonderful. How big is it?

Mark: [00:05:29] It’s 300,000ft², spread over eight buildings around a lovely little courtyard. It’s ridiculous, it’s so big.

Eve: [00:05:40] And it has a really rich history. I learned that not only was it the largest pajama factory, but Keds were invented there.

Mark: [00:05:48] That’s correct. Largest pajama factory in the world.

Eve: [00:05:52] In the world? Yes.

Mark: [00:05:53] Apparently, apparently. It was before China became a big manufacturer, obviously.

Eve: [00:05:58] And before people stopped wearing pajamas.

Mark: [00:06:00] Well that too, yes, that’s another discussion. But yes, it was originally Lycoming Rubber Company and its history as being part of us rubber is what ultimately warranted listing on the National Register of Historic Places. But as a rubber company, they started in 1883, I think, and they made, basically they dipped wool socks in rubber and gave them to the lumber industry, and that’s what they used to climb around on the logs as they took them down the rivers. That was their start. But then it moved into athletic wear at the turn of the century, the turn of the last century. And they did invent and produce Keds sneakers here. And I think Keds sneakers was introduced in 1916. And the big buildings, we have three big buildings, all connected, which comprises two thirds of the whole 200,000ft² out of the 300,000. I think they were built by Keds, by the Keds business, because the timing was right. And Keds claims accurately that they were the first mass produced sneaker. Converse came out at the same time with their sneakers and, approximately the same time, and Converse claims that they are the first sneaker mass produced, as opposed to the first mass produced sneaker. In other words, Converse got up and going and produced their sneaker before Keds did. But Keds was introduced before Converse.

Mark: [00:07:41] Yeah, I know they’re all fighting. Yeah, it’s neat stuff. So, they were here for 15 years, I guess, and it was early in the depression that they consolidated their operations, their shoe making operations in Connecticut. And they continued to own this building for another 20 years but sublet it out to small shoe making companies and the garment world.

Eve: [00:08:11] So, light industrial. Yeah.

Mark: [00:08:12] Yes, yes. And Weldons, well done Pajamas is the company that grew and ultimately bought the building in 1950. And I will say that we’ve got some examples of their pajamas around. They’re very nice. I mean, not for me, but whatever, they’re very nice. They were well done. But their architectural work on the complex was not well done at all. It’s really terrible.

Eve: [00:08:40] So, now you have the building, right? And I’ve seen it and I know you preserve and honor that history. How did your vision evolve? What did you decide to do, and how long did it take to figure that out?

Mark: [00:08:54] I had a friend of mine in New York who was involved with us from the beginning. Another friend, not the one who introduced me to the building, but a really smart guy. He was in marketing and very thoughtful. And he and I were talking about this, and the original idea was that we would bring Philadelphia and New York artists out here. The property is cheap and inexpensive and it’s neat but that didn’t happen. That was our goal is to bring folks and my buddy, being smart the way he is, he says, you can’t, you need a there there. You need something to exist before you can attract folks. And you have a vision, but they’re not going to come for the vision, they’re going to come for the fact. So, we had a kind of a rough time like, well how’s this happen? The other thing you did that was critical was he and I developed the idea of building a community, and it was the community idea that is the value added for the building. He accurately suggested that if we just try to advertise space based on price, it’s a downward spiral. You got to have something else. And it was community. So, we start to nurture that idea and it’s taken time. It takes a lot of time.

Eve: [00:10:13] So how does your architectural background influence this project? I mean, you you’ve had a long career and probably learned some things in Tokyo where you spent some time.

Mark: [00:10:24] Oh my goodness, yes. Yeah. Well, what is it? I mean, first you need a love of the building and then have confidence that you’re not alone with that love and then respect that. And so, yeah…

Eve: [00:10:41] I want to chime in I saw that respect when I was there because you dismantled, you know, old bathrooms and have reused the beautiful slates as countertops. And I saw even, you know, the shower rods were old bits of metal pipe that had obviously come from somewhere in the building. So, to me, it looks like a building that’s being dismantled a little and sort of shoved back around like a jigsaw puzzle into something slightly different.

Mark: [00:11:10] Yeah, a little steampunk, a little recycle, little homegrown, all of that. We do it all in-house. I think that’s kind of key is that that we’ve developed an in-house team. You can’t specify recycle as an architect. You know, it’s, but if you got a pipe and you got a pipe threader, you can make something up as you go. And we’ve been doing a lot of that. And I like that. That’s part of what I enjoy doing. I’m a ceramist. I deal with little things, and I deal with big things, and I like craft and I want to put craft in building. I want the design to be crafted, but then I want the product to be crafted. The hand is important, so that’s been fun for me. I don’t know that it’s necessary to make the project successful, but…

Eve: [00:12:02] Right.

Mark: [00:12:02] Am I answering these questions? I don’t know.

Eve: [00:12:04] Oh yes, yes. I can hear Suzanne cooking in the background. And we’re not we’re not going to edit that out. Okay.

Mark: [00:12:14] No.

Eve: [00:12:15] So you’re nudging the building, all 300,000ft² of it, from almost vacant to a fully occupied creative hub. So how far along are you? Tell us about the activities and facilities already there.

Mark: [00:12:30] It’s amazing. I just had someone come in yesterday. And I’m so excited about this. He came in, he is a luthier, and I’ve talked to people about a luthier. No one knows what a luthier is.

Eve: [00:12:45] What is a luthier?

Mark: [00:12:47] Here we go. A luthier is someone who makes and repairs stringed instruments.

Eve: [00:12:54] That’s what I remembered, yes. So, we call them a violin maker. But there’s many more. Oh, yeah. No string instruments. String instruments. You got lutes and basses and all sorts of things. Yeah, OK.

[00:13:08] Yes. So anyway, he is in, he’s involved, he’s a co-president of an international luthier’s organization that meets once a year at Oberlin, in Ohio. And I guess there’s a big music program out there. And they’ve been very supportive of this organization, but they shut down for the pandemic because nobody could travel. And then Oberlin informed them that they can’t use the facilities that they’ve used for three decades now because it’s under construction. So, he’s scratching his head. Well, maybe we should do it in Williamsport. And he gave me a call and I showed him around. We have the wood shop so they can cut pieces of wood and work on their luthing? I don’t know, whatever they do. And we have the Clerestory event space, which he thinks is magnificent.

Eve: [00:14:00] It is gorgeous.

Mark: [00:14:01] They have 60 people that are going to come from around the world, and everybody from somebody who’s just entering the field for a couple of years in, to guys have been doing it for decades and get pushed around in a wheelchair, the whole spectrum from all over the world. 60 folks are going to come into town, I hope. And this fellow and the head of the wood shop got talking, and they immediately got down to what kind of hand plane they like and why, and what is the angle of the blade on that plane. And, you know, that’s the number three, not the number two from that manufacturer. And I’m like, oh my God, this is too good. I love that. And that’s you know, that’s what we’re, that’s what I’m trying to build here is this collaborative opportunity for folks. You know there’s no requirements. You can go be a hermit in your studio. So that’s neat. That’s what’s going on there. But we, I mean that’s one end of the spectrum, this really rarefied craft. And the other end of the spectrum is we have, tonight, we have a pro wrestling match in that room. I mean, you can’t make this up.

Eve: [00:15:15] You also have a volunteer bike recycling shop.

Mark: [00:15:21] Yes, we do.

Eve: [00:15:23] I don’t remember what else was there.

Mark: [00:15:25] Oh my. Okay. Well, we have a community wood shop, and we have a clay studio, which is open to the public. You take classes and become a member there. We have a dark room, old school dark room, mostly working on experimental systems, old ways to develop film and paper. And we have the coffee roaster and a, pasta maker, and…

Eve: [00:15:53] And the coffee roaster makes great pastries.

Mark: [00:15:56] Oh, yeah. Yeah. Very. Yes, yes. And then lots and lots of studio spaces with small businesses, marketing folks and artists and lots of photographers because the windows are massive and have a really interesting diffusing glass from the early days which creates great light in the spaces. So, we got lots of photographers.

Eve: [00:16:21] And residents. Right?

Mark: [00:16:22] Yes, we do. We have residents, maybe a dozen. We want to put in another 60 residents, low end, lower cost, basic, room with the toilet, if you will, for the cheap artist lofts.

Eve: [00:16:38] It’s a lot more than a room with a toilet. They’re really spectacular. Tall ceilings.

Mark: [00:16:43] Some of them can be. Yes, some of them can be. But I want to make some really inexpensive ones and attract the artists. And maybe they move up, maybe they don’t. Or maybe the folks that live in the nice spaces on the top floor buy the artwork from downstairs, I don’t know.

Eve: [00:16:58] So Mark, most developers look for anchor tenants for very large projects like this because then that brings additional tenants along. What’s your approach to that?

Mark: [00:17:09] I have not found that to be useful at all, which has created a problem with the banks. I have found we have a couple of bigger, we have one bigger tenant. And he uses rent for his cash flow management, which is a problem. We have 160 spaces rented, all small, otherwise all small tenants. And I find security in having a lot of tenants, instead of giving power to a few tenants. So, you fight the financial system by not having an anchor tenant that basically can cover a good percentage of the rent, but in my case, with 300,000ft², what’s an anchor tenant? 100,000ft². You know?

Eve: [00:18:04] And anchor tenants tend to be not local too, right? So…

Mark: [00:18:07] Right.

Eve: [00:18:08] How many how many of your tenants would you say are local? You know,

Mark: [00:18:11] All of them.

Eve: [00:18:12] All of them.

Mark: [00:18:13] All of them.

Eve: [00:18:13] The retail tenants? Yeah.

Mark: [00:18:15] Yeah, all of them.

Eve: [00:18:17] So they’re very committed to the community and the town.

Mark: [00:18:21] And the factory, which is nice. Yeah, they’re committed to the project.

Eve: [00:18:25] What’s an attractive condominium price then? There.

Mark: [00:18:30] There’s no history out here. So, it remains to be seen. I’m hoping to produce finished lofts in the top floor for $200 a square foot.

Eve: [00:18:42] I mean that’s less than half what they are now in Pittsburgh, Pennsylvania. Can’t even guess what they are in New York or Philly.

Mark: [00:18:49] Oh, yeah, no it’s crazy. It’s ten times. I mean, in Manhattan, it’s pushing $2,000 a foot. And Philly I looked recently and Philly, I seem to find a lot of them around $300 a foot. So, I think we can, the question is, can we make it work? But I think we can because the acquisition costs of the property was so low.

Eve: [00:19:13] So you’ve got about 60% of the space full?

Mark: [00:19:16] Yeah.

Eve: [00:19:16] And you’re now on a path to build out the final 40%.

Mark: [00:19:22] In in phases, still.

Eve: [00:19:24] In phases. Okay. Cause that’s a lot of square footage, right?

Mark: [00:19:29] Yeah, it still is. That’s right.

Eve: [00:19:32] And so, like, about the creative facilities, what else is planned? You’ve got a luthier coming. I mean, in your vision what would be ideal?

Mark: [00:19:41] Well, we’ve got the clay studio, wood shop and bicycle recycle, and photography are all part of a non-profit umbrella organization called Factory Works. And I’d very much like to see Factory Works expand their offerings to include metalworking and printmaking and glasswork. I mean, we can keep going. Whatever, you know, have a maker space, get some digital fabrication going. So, to that end, I’m dedicating about 15,000ft² of space on the ground floor to consolidate and allow them to expand at the same time. So, I think that’s going to be key. What we really need to do is get the tenants to start to take control of their own futures here and allow me to step aside. That’s a challenge. I don’t know, I’m hoping the condo process will do that.

Eve: [00:20:41] Yeah, because you then can create a condominium association which has governance that isn’t just you making decisions, right?

Mark: [00:20:49] Exactly, exactly.

Eve: [00:20:51] And it’s yeah, it is challenging. So, what’s a typical day at the factory like for you since you live there?

Mark: [00:21:01] Yeah. Oh, you know, I’ll get a call when someone’s key breaks off in the lock and there’s a pipe that breaks somewhere because it froze in the winter because we can’t heat the whole place yet. What is my typical day? Yeah, I got a lot of balls in the air, but I try to keep focused. I’m trying, we went away, Suzy and I went away in a vacation for two weeks. I didn’t talk to anyone for two weeks. The place ran itself.

Eve: [00:21:29] That must be comforting.

Mark: [00:21:31] Well, it almost is. And I say almost because there isn’t really a number two person who would call me. if there’s an issue. There’s a bunch of number three and number four and number five people, but there’s no number two person. And so, I need, I kind of need that. And I need enough cash flow to be able to just pay someone to be number two. And then I’d be directing him instead of trying to direct everybody. So right now, we’ve got ten employees and I have to sort of stay on top of all ten of them. They’re all doing things that are different. Well, three of them are doing construction, so there’s a hierarchy there. We got one guy who’s in charge of construction and maintenance. But otherwise, everybody’s kind has an individual discipline, which is unnerving because you have one bookkeeper and then she’s out sick, you know. Yeah. What do you do?

[00:22:26] Yeah. There’s this is dilemma when you’re in the 10 to 20 people phase where you can’t really quite afford someone to supervise everyone for you. It’s tough.

Mark: [00:22:34] Yeah, yeah, that’s where we’re at. Again, the condo will have a board that takes care of this, which, but we’re a ways from that.

Eve: [00:22:45] Yes. What aspects of the project have been the most delightful and rewarding for you.

Mark: [00:22:51] Yeah, that’s a good question. It all, it’s, you know, what part of the spaghetti sauce is your favorite?

Eve: [00:22:57] Okay, I’ll move on. What’s been the most challenging then?

Mark: [00:23:03] Yeah. Fair. Money.

Eve: [00:23:07] Money.

Mark: [00:23:07] Money has been money has been the most challenging. And, I mean, coming from New York, money’s around. You have a viable project. You put something together, you can find money. At least that’s my understanding. But out here, we’re breaking all the rules, and it seems to stack up against any kind of conventional financing. I think the biggest problem with this small town that continues to lose population is that real estate values at best are stagnant.

Eve: [00:23:40] How does a bank assess the value, right? There’s just no like kind property at all.

Mark: [00:23:46] That’s another problem. But yes, there’s, so, you know, we have cash flow now. But why would a bank want to invest for 30 years in a dying town? Or 25 years, or 20 years. It’s a big burden. So, they’re very conservative about when they invest. So, they’re looking at 50 or 60% loan to value ratios instead of 80, 90%. And they put a very, the appraisers put a very conservative capitalization rate depending on whether you’re on the receiving or sending end there. But they use a cap rate of ten. So, you you’ve got these hurdles. You can’t get the cash flow at a cap rate ten to support significant debt.

Eve: [00:24:35] But you’ve done it, right?

[00:24:38] Well, yeah, I mean we had help when we bought it. We had help when we bought it. There was a very aggressive banker before the regulations changed before the financial crisis. We bought it just before the financial crisis in 07/08. And the regulations have hamstrung the bankers in many ways. But we bought it before that, so we got a loan before that. And they had a, the town had an economic development person on staff, and the banker worked with them and therefore the mayor at the time and we got a loan. It was a small amount ultimately, but it was enough for us to get involved. We got a $600,000 low interest loan from the state through the city. So that got us going, but we’ve had nothing since then.

Eve: [00:25:32] Oh, wow! You have gotten a grant from the from the state.

Mark: [00:25:37] The state? Yes. I know it’s interesting. The biggest challenge has been to convince the local administration folks, the local city government that we’re good guys, and it seems a natural to me, but it’s been very, very difficult. I think we’re coming around now because there’s enough of a chorus out there with all of our tenants and all the events that we have here. Enough of a chorus that’s very supportive that they, I think they’re beginning to come around.

Eve: [00:26:15] So do you think your project has influenced the perception of Williamsport? It’s a lot of square feet in a small town.

Mark: [00:26:25] It’s beginning to. There’s a number of tenants that have moved back to or stayed in Williamsport because of the pajama factory. And of course, they talk about that to others. So, yeah, I mean, that’s what’s most exciting, I think. That’s the part that I find most exciting and the part that’s most surprising when I bought the building. You know, it’s a bunch of bricks and windows. I’ll fix it up and we’ll get it occupied. But now we’re changing a town, and that’s very exciting.

Eve: [00:26:56] It’s economic development.

Mark: [00:26:57] Yeah. Yeah, absolutely.

Eve: [00:27:00] So you’ve also listed a raise, which was launched yesterday, on Smallchange.co to raise funds for this next building phase that you’re going through. Is this partly the reason why? It’s too hard to find, you know, I don’t even know what normal money is, I’m not sure I should say that, but it’s very difficult. I mean, I’ve worked with other developers who have similar problems. Anytime a project is out of the city and unusual, it is almost impossible to get institutional financing. So, you’re not alone. Although that doesn’t really make it better.

Mark: [00:27:39] What I’ve found is you can get institutional financing, maybe, for your facility, for your project as it sits. So, I got financing based on our new cash flow and new appraisal and they made sure that there was enough cash flow to pay for the financing. There was nothing for development. So that any development has to be, money, has to be obtained outside. And that’s where Small Change is going to help us. In the past, I’ve approached some friends and family and that’s gotten us going. But I love the way that Small Change works, and I think it’s going to do a lot to publicize what we’re doing here in town. And I’m looking forward to getting, I don’t know I’ll get so much money out of the town folks, but I think we’ll get a lot of positive PR and I’m going to push that. Yeah.

Eve: [00:28:46] Good. So, and what will this next round of funding build, you know, along with the, I know you have funds from the state as well, a grant. So, what are you planning?

Mark: [00:28:56] Yeah. So, uh, I hope to have about three mil to work with in total. And the state funding is going towards long deferred, too long deferred maintenance issues like roofing, parking lots, HVAC systems, the stuff that doesn’t pay rent. Every time, I mean, because we can only get money based on rent roll, every penny that I got from a bank or development went into developing rent roll. How? With the roof right now, I need rent roll. But now we’ve got some free money coming. Not free, it’s grant money. A lot of brain cells get expended when you work with these grants. But anyway, I’m going to use the grant money to, you know, secure the building at this point. That’s very exciting. But then there’s some more money left over, I hope and that’s going to go towards, well, my favorite project, and it’s probably for personal reasons, is our beer garden on the roof. I want to use…

[00:30:00] Now, is it the beer or the garden, Mark?

Mark: [00:30:03] It’s the beer, of course. Well, you know, it’s going to be what I can do in the afternoon when I can’t drink coffee. Time to go upstairs. The roof is amazing. It’s so beautiful up there. You’re in a valley, in a green valley and you’re above all the trees and all the other buildings you can see all the way downtown. The sunsets off to the west, right off the roof. And we’re putting a kind of a guest bar up there, and we’re going to use the beer garden to, I hope, attract, a craft brewer. And then the craft brewer’s going to move in downstairs. I’ve got 6000ft² of space dedicated to a brewery. And then I’m hoping that the activity with our new parking lot out front and the craft brewery downstairs. I hope that activity generates some interest for the restaurant. So, then we really start to have an ecosystem here that’s pretty complete. And I just need to do that before I’m in my walker, because I have to get this happening.

Eve: [00:31:12] I don’t think that’s ever going to happen, or not soon. So, what advice do you have for anyone contemplating a similar project?

[00:31:19] Call me. You have to be prepared for a lot of time. I did this in New York. We bought into a loft in downtown Manhattan in 1984 and paid almost nothing for it. It was a dump. It was truly a dump right over a disco. But I knew that there was a lot of space, and I was an architect. I was like, okay, I’ll work with the space, and we’ll see how it goes. And it went fantastic for us over time, it’s now worth a bloody fortune. And it allowed me to buy this building. So, I’m like, okay, let’s do it again. But it takes time. I mean, it was 30 years in New York to build the value.

Eve: [00:32:03] Yes, like, real estate is a long hold.

Mark: [00:32:07] It should be, and I think the way the development world works and money works, it demands a short-term return. And that is counter to building a quality, community-based structure, or institution. So, you got to go into it with your eyes wide open that it’s going to take a long time. Even longer than you think. As I said, this is a five-year project for me, and I’m on 16.

Eve: [00:32:39] So there’s no sequel planned for you, right? There’s not a pajama factory number two?

Mark: [00:32:45] No, there really isn’t. No, people have asked. No, this is plenty. And it’s, the other thing about it is it’s an endless project, which is fine. You know, I want to get it so it can support itself, but that doesn’t mean I can’t continue to contribute.

Eve: [00:32:59] So final question I want to ask is how does this project feed your soul?

Mark: [00:33:05] Oh, so many ways. As I said, I love the crafts. I was an architect, I decided to go to the dark side and become a developer. And then after many years, I finally decided I’m not really a developer, I’m a design builder. And I love that. I love getting my hands dirty, being right there with people, doing work, trying to figure out problems. I mean, that’s what I love to do. I also love people. I love to meet them. I love to introduce them. I love to find out what makes them tick. And I think the combination of the two has been essential for the success we’ve had to date.

Eve: [00:33:44] Well, Mark, it’s a pretty rare developer that puts so much soul into their project. As you know, our cities are filled with soulless buildings.

Mark: [00:33:55] All the more now.

Eve: [00:33:57] Yes. So, I really appreciate what you’re doing and thoroughly enjoyed talking to you. I hope the raise goes gangbusters.

Mark: [00:34:04] Yeah, Good. Yes, I do too. And I’ll be pushing it and rewarding everyone who helps.

Eve: [00:34:20] I hope you enjoyed today’s guest and our deep dive. You can find out more about this episode or others you might have missed on the show notes page at RethinkRealEstateforGood.co. There’s lots to listen to there. Please support this podcast and all the great work my guests do by sharing it with others, posting about it on social media, or leaving a rating and a review. To catch all the latest from me, you can follow me on LinkedIn. Even better, if you’re ready to dabble in some impact investing, head on over to smallchange.co where I spend most of my time. A special thanks to David Allardice for his excellent editing of this podcast and original music. And a big thanks to you for spending your time with me today. We’ll talk again soon. But for now, this is Eve Picker signing off to go make some change.

Image courtesy of Mark Winkelman

The Aux Evanston

There’s a real estate project underway in Evanston, Illinois, and it’s called The Aux. Led by a diverse team, it represents much more than just the revamping of a 16,500 square foot vacant factory building. It represents the aspirational hope of a community.

Not only does the community plan to fully renovate the building into a wellness hub, they plan to populate the space with local, black-owned businesses including an award-winning chef, a laundry cafe, private offices and co-working space to name a few. Space is also planned for pop-up businesses coupled with entrepreneurial training programs in order to provide accessible marketplace options for growing new businesses.

The instigator, a non-profit, assembled a co-developer team of local leaders. They’ve decided to take on an even bigger challenge than this renovation.  They are planning real community ownership. Every investor will become an owner with voting rights.  

If you’re interested in supporting real estate projects that make a difference, look no further than Small Change, where The Aux is raising funds through a crowdfunded community round. Anyone who is 18 years old or older can invest here.

This is not a solicitation of an offer to buy or sell any securities. All investing is risky and involves the risk of total loss as well as liquidity risk. Past returns do not guarantee future returns. If you are interested in investing, please visit Small Change to obtain the relevant offering documents.

Image courtesy of The Aux Evanston

Architectural entrepreneur.

Atif Z. Qadir, AIA is the Co-founder & Chief Impact Officer of Commonplace, a market network at the intersection of real estate and capital markets. He is a Registered Architect and LEED Accredited Professional turned entrepreneur with a particular interest in housing and impact. His strengths are observing, asking, analyzing, and using the power of narrative to uncover, share, teach, support, advocate and champion. He is a builder at heart, who is comfortable in different scales and settings – from small workforce housing units to multi-billion dollar redevelopments, from podcasts and panels to public service, from nonprofits and academia to private equity & venture capital backed companies, and from design to finance to public policy.

Atif is also a Founder & Partner at Amanat Properties and serves on the Planning Commission in the City of Hoboken, the Advisory Council of Provident Bank and on the Board of Trustees of The Hudson School. He previously worked at Extell Development and Turner Construction. He began his career at Rafael Viñoly Architects and Boston Housing Authority. He studied at MIT, where he received dual bachelor’s degrees in Architecture and in Urban Planning, and at Columbia Business School, where he received a MBA focusing in Finance.

His work has been covered by MIT Technology Review, Commercial Observer, Propmodo, and The Real Deal. He’s also a frequent speaker on the future of buildings and cities on popular industry podcasts and at conferences, including this past year at the Commercial Observer National Diversity & Inclusion Forum, Yale Alumni in Real Estate Association Conference, the Columbia Real Estate Symposium, NYC Open Data Week NYC and Austin Design Week.

Read the podcast transcript here

Eve Picker: [00:00:04] Hi there. Thanks for joining me on Rethink Real Estate. For Good. I’m Eve Picker and I’m on a mission to make real estate work for everyone. I love real estate. Real estate makes places good or bad, rich or poor, beautiful or not. In this show, I’m interviewing the disruptors, those creative thinkers and doers that are shrugging off the status quo in order to build better for everyone.

Eve: [00:00:39] Atif Qadir is a serial entrepreneur, but that’s not where he started. Trained as an architect and urban planner. Atif decided pretty early on that what he wanted was to work his way up the ladder from servicing developers as an architect or builder to being one. So, he started developing his own small properties. And as his frustrations with finding project financing grew, so did his entrepreneurial ideas. He launched Commonplace, a fintech platform with a mind to create a marketplace for emerging developers and investors. Dating for development projects. In amongst all of this and in partnership with the Office of Michael Graves, Atif hosts a podcast show called American Building. He’s a high energy guy. You’ll enjoy listening in.

Eve: [00:01:40] Hey, Atif, it’s really good to have you on my show today.

Atif Qadir: [00:01:44] Thank you so much for having me on, Eve.

Eve: [00:01:46] Oh, yes. It’s going to be fun! So, you have a very multifaceted resume, lots of fingers in many pies, but your background is fundamentally architecture and planning. And then you went on to get an MBA at Columbia. What prompted you to transition from a registered architect to entrepreneur?

Atif: [00:02:08] Sure. So, the job that I had before going to business school was at Turner Construction, doing construction management for huge projects in the New York area. And for me, I had thought that going from architecture to construction was higher up in the food chain about actually be making decisions. When I realized that as a construction manager for a developer, I still wasn’t making any decisions. I was executing on decisions, but I was telling the architect what to do. So I sort of had moved up in the food chain but not quite to the the decision making power center yet. So, I knew there was a few more steps I had to go.

Eve: [00:02:45] And what was the top step you were attaining to acquire.

Atif: [00:02:51] At that point? I think it was being a developer, but then not to bury the lead, I realized that even being a developer is not the top of the food chain because now you’re answering to the investors, so, and the bank most importantly.

Eve: [00:03:02] Always the banks, always the banks, right? But anyway, you can definitely, as a developer, you have more control over more aspects of the project, right? Not just, and that’s a lot more fun, right?

Atif: [00:03:14] I think it’s a lot more fun. I would say the way that I describe being a developer in the context of, say, jobs or roles that are easily understood is I think a developer is a lot about being a project manager, an accountant, a janitor, a babysitter, a therapist, a divorce lawyer. Like all of those things is all the skill set of being a developer.

Eve: [00:03:38] Well, I would add artist to that.

Atif: [00:03:40] Oh, yeah, yeah! Artist, of course, yeah. Sometimes it’s easy to forget that one.

Eve: [00:03:45] You’ve got to use that side of your brain to really envision things, right? If you’re going to do a good job of it, right?

Atif: [00:03:51] Of course. Yeah. I think that there’s this great quote that I saw on LinkedIn. There’s a gentleman named Tyler Sumaila who does coaching for architects about how to think and how to present themselves the value that they bring. And I think there’s a lot of similarity between what we’ll say for architects and developers. Basically, it says teaching an architect is like teaching a baker how to bake every bread that’s ever been made before and how to make every bread that could potentially be made in the future and not teaching them how to run the bakery. That’s essentially what an architect does.

Eve: [00:04:25] Actually a pretty good analogy. Yeah.

Atif: [00:04:27] And feel developers are maybe like a shade similar to that too.

Eve: [00:04:30] That’s true, that’s true. So, I’m going to explore three of your companies. They were the only three I could find so far.

Atif: [00:04:38] I’ve tucked to a few more into the side.

Eve: [00:04:40] If there’s a few more just let me know, okay? But the first is Amanat Properties, which is perhaps the most traditional of your companies. That’s your development company, right? And what type of projects do you focus on and where are they?

Atif: [00:04:54] Sure. So, it’s in the Garden State, the great state of New Jersey, and the types of work that I do is historic redevelopment on a small scale. So, these are the projects that completed are a rental building in Hoboken where I live, and a condo building as well. And then I also have a workforce housing portfolio of 13 different assets that are, I purchased them as Class C and then brought them to Class B with renovation. And those are in Hudson and Middlesex County in New Jersey, which is the I-95 corridor.

Eve: [00:05:30] Oh, okay. And what drew you to this niche?

Atif: [00:05:33] So I would say from a few different perspectives. One is from the geography perspective, once I moved to New Jersey after business school, I realized there’s this whole amazing place called New Jersey and Hoboken and Jersey City in particular is the half price clean version of Brooklyn. And I was like, there’s so much value, so much value there. So that was I think the geographic reset was really important. I think number two was having spent a couple of years at Extell, I realized that at a very prominent real estate development firm like that and perhaps others, there’s a glass ceiling that you come to. And of course, it’s based on gender. But there’s another layer, of course, on that, which is if you’re not the family member of the founder of the company, there is a limit to how far you can go. And in this particular situation, Gary Barnett, the owner of Extell, very intelligent, very prolific developer. All of his daughters were already married so there was really no option for me to join the family at that point. So, I started considering the other options.

Eve: [00:06:43] Was that your way in, marrying a daughter?

Atif: [00:06:45] I would be so good as a house husband. I would kill it as a house husband. But unfortunately, that route wasn’t available. So that was the second thing kind of draw out. And I would say in particular, when it comes to fixing, I’ve realized over the course of my career that my nature is actually very much more a fixer and a bringer together and a resolver than my nature is as an executor as opposed to a creator. So, for me, I actually enjoy the idea of historic redevelopment significantly more than vacant land. So, I think all those reasons were the influences that brought me to do development the way I described it to you.

Eve: [00:07:28] And so what are the unique challenges that you faced?

Atif: [00:07:32] Yeah. So, I think the most often thing, when ask this question to other developers, it’s how much time do you have?

Eve: [00:07:39] Go, go for it.

Atif: [00:07:42] Go for it, do it. I would say, the three that I would say come to mind right away, number one would be access to capital. So, I think that for me, for my deals, I had probably done a hundred tours of Hoboken and Jersey City to raise $8 million from a small handful of investors. And then I talked to 35 banks to get the debt that I needed for my two development projects. And I still ended up having to use a mortgage broker.

Eve: [00:08:13] And why do you think that is? Why is it so hard?

Atif: [00:08:16] I think that fundamentally it boils down to this issue of a supply and demand mismatch. And I think at the smaller level, there is an array of potential investors, but none of them are institutional level and being able to actually find them and find them at the time that they have the money to give to you is really like the whack-a-mole challenge.

Eve: [00:08:39] It’s a huge challenge. So, you’re talking about what I call the $10 million check problem, right?

Atif: [00:08:44] 100%. I was just talking to Caleb Ratinetz, who’s a principal at Asland Capital Partners. So, a mid-size equity provider for residential inclusive of affordable housing. And he’s like, asked me like, why wouldn’t you invest in projects where you’re cutting checks of three, 4 or 5 million? He’s like, why? They’re bigger headache than me for like a $10 million check and even a $10 million check is a headache.

Eve: [00:09:09] Which is a really big problem because that means that emerging developers, disinvested neighborhoods, all those things that you and I probably care about get left behind because I think that gap is widening and widening. It’s not, it’s probably no longer $10 million and it’s probably creeping up to $15 million.

Atif: [00:09:27] I think it’s inflation is now like 30% a year.

Eve: [00:09:31] So that’s a huge problem. And has that slowed you down in the projects that you’ve been able to? Well, of course it has.

Atif: [00:09:41] Come to think of it like this, is that if it took me, so 2018 is when I acquired title to the two properties and both of them were stabilized by the spring of 2020. So, it was two full years to do two projects that were under $5 million each. I just like, imagine the amount that I could have done. I could have done eight townhouses or like eight small multifamily buildings in that time if I wasn’t running around doing the dog and pony show for investors and for lenders. So, I think the volume of stuff is definitely what ends up being affected.

Eve: [00:10:18] Okay. And then, like, what does your team look like? Who are you working with? Yeah.

Atif: [00:10:24] Yeah. So, for Amanat Properties, it’s a one man show. So basically, I JV with a company called Hanini Companies, Hanini Group sorry, and that’s in, based in Newark, New Jersey. And the construction is sometimes from them and sometimes from a third party. Architecture is from a third party. The development soup to nuts is my responsibility, including the expediting, because I tried an expediter and that’s not a good idea. So, I did not decide to go down that path. And then asset management, all that stuff is me. So that’s essentially the way that I’ve broken down Amanat Properties. I’ve had probably at least a dozen interns over the course of the years that I’ve done development, but it’s more because it’s fun and I like teaching as opposed to like actually having any benefit from it for me.

Eve: [00:11:12] So Covid must have slowed you down a bit.

Atif: [00:11:16] Covid messed a lot of stuff up. And I think in particular it was the idea of the left hand not knowing what the right hand was doing when it came to government decisions as to what work was considered essential versus not. And it was as crazy as the state of New Jersey declaring certain trades as essential, and the city of Hoboken declaring others as non-essential. And then even when they were declared essential, oh, City Hall was closed for a few weeks. So, we were never getting the inspections that we needed anyway. So, I think that that was the biggest frustration. The banks, I thought my banks, they were patient. My investors were incredibly patient. It was the municipal approvals and all of that stuff. That was the problem.

Eve: [00:12:02] And coming out of Covid, like we’ve heard a lot about the disarray of the commercial real estate industry and how is that impacting you? Do you have a next project lined up? Is it harder than it was? Even harder than it was?

Atif: [00:12:17] Yeah, I would say the biggest issue that I am foreseeing is this reality. So, I’m talking to a chief credit officer of a local community type bank in New Jersey and said, oh, so how are you doing with new commercial real estate loans? And he’s like new commercial real estate loans? What are you talking about? And I was like, no, like, seriously, aren’t you deploying capital? He’s like, only for Perm and only to people that we’ve done business with before that have a significant amount of cash at our bank. That’s it. And that type of a of a response. I heard maybe a slightly more liberal like version of that from a super regional bank that I do a lot of business with. And then from the Wall Street and the larger banks of the community development banks that are operating in this space. For them, it’s generally business as usual, but the issue often is that the checks under $10 million, like there’s no use of, like they can’t do them anyway. Before they wouldn’t do them and now, they wouldn’t do them. So, I think it’s the evaporation of options, which is the issue right now. And I think coming forward for the next two years, it’s not going to get any better.

Eve: [00:13:30] Not going to get better.

Atif: [00:13:31] Yeah, there’s about $1 trillion of commercial real estate debt coming due dominantly in office and retail and dominantly held by regional and community banks. So that the lender that would lend to people like us, no, they’re not, they have bigger issues now.

Eve: [00:13:49] Right, it’s pretty difficult times. That’s really depressing Atif, but it’s really true and I think the bank collapse earlier this year is also going to make lending even harder because now experience will count even more. So, it makes it very difficult to start a career in real estate, you know.

Atif: [00:14:08] I feel like experience is often the catch-all term to incorporate many shades and variations of biases together, because the quintessential problem many of our colleagues, when we were together at the Small Scale Developer Forum that Jim Heid runs in Philadelphia, the last one, is that is the chicken and the egg problem. How is it possible to have a diverse group of developers in this country when your requirement is to have done 50 projects already? So, unless you were born to come out of the womb with 50 projects done, how would one even do that?

Eve: [00:14:42] Yes, it’s a very big problem. Very big problem. Let’s move on to the second company, which is now called Commonplace, which I think probably, I’m guessing, addresses some of these issues. So, what does Commonplace do? What is Commonplace?

Atif: [00:14:56] Sure. So, Commonplace is not a real estate development company or an investment company like Amanat Properties. It’s a technology company and it’s one that’s considered a startup. So, we have venture capital financing. And what our mission is, is to help impact developers be able to access capital more easily in order to do the good work that they’re doing. So, we’re a team of six, based in New York, and our focus is on making double opt-in qualified introductions between impact developers as well as capital providers. That’s our first product. And from there we’re building out a suite of other activities and initiatives and products that we hope to release in the next couple of months.

Eve: [00:15:45] Interesting. How far along are you with the product? How many introductions have you made?

Atif: [00:15:50] So we’re about 150 a week is where we’re at right now. So, we’re starting to now do the, like the assessments from the past quarter of how many went to first conversations, how many went to second conversations, and how many went to term sheets. And I think over the next quarter, we’ll be able to reassess that as well. But essentially what we’re, we’re approaching the problem from the perspective that the issue isn’t necessarily technology, and the technology is the accelerant of something like this. But the issue often is simply the relationship not existing. So, from that perspective, we’re taking actually, frankly, a low tech approach to the introductions and then implementing technology in different layers to make that accelerated. And we’re actually seeing this as the test case for us to be able to deploy something that is more robust and more technology native, which we’re calling Capital Applications. And that’s a product that we’re excited to launch with six capital providers in the next couple of months.

Eve: [00:16:53] Oh, interesting. So, when did you start Commonplace?

Atif: [00:16:57] So commonplace. We started in its original iteration in 2020 as REDIST, which was a software as a service company focused on data related economic development incentives and then Commonplace, we relaunched as Commonplace in May of this year.

Eve: [00:17:15] What prompted you to reimagine it?

Atif: [00:17:18] So I mean, I thought when I was banging my head against the wall and capitalizing my deals that, gosh, it must be economic development incentives that’s going to solve, they’re going to solve all my problems. And I was like, these are really hard to figure out and find and learn and get. So why don’t I put all the information together and I’ll make my life a lot easier and probably that of developers. So, we did that. We gathered all the data related to 6000 different incentives in 13 states. We curated all the content and wrote that up in a way for developers to understand, and we piloted that with 250 companies. We had paying customers. And often what we heard from our customers and from the folks that piloted our product was this is great, could you help us find debt for a new construction multifamily project in Detroit? Because we don’t know any community banks in Detroit that want to fund new construction right now. Or, like another classic one that we heard was, oh, I have all the capital from my 80 different sources for a repositioning of a historic hotel in a majority minority neighborhood in Chicago, but we just need another million and a half of equity and we don’t have any more friends and family to go to for $10,000 checks. Could you help us find some more equity? My favorite one was a developer in New Jersey who had said, oh yeah, we’d love to get debt help. We need help with debt besides the incentives. And he’s like, you’re a licensed architect, would you, could you also design our whole development for us too?

Eve: [00:18:54] So are you adding in design services?

Atif: [00:18:57] Oh, no, I’m not going back to that one. And also, it’s been so long since I’ve gotten CAD, but generally the three people that I’m describing all were of a similar style person, which was a midsize impact developer that was developing in a majority minority area. And we realized like the similarities again and again, and that’s what made us take a pause, spend a couple months, do a bunch of research interviews, go through our notes again and figure out how we want to address the same problem in a different way.

Eve: [00:19:27] Really interesting. Well, that brings me to the final one of the three I know about, and that’s called, the podcast, American Building Podcast, which you host. Tell us about that and what motivated you to launch it.

Atif: [00:19:41] Sure. This was motivated by the magic of LinkedIn. So, the new CEO of Michael Graves Architecture and Design, His name is Joe Furey. He has the three letters after his name it’ not AIA, it’s CPA. And he is probably the most fascinating head of a design firm that I’ve seen because he’s no nonsense. It’s like, let’s get to the point. And I think particularly for firms that are going through transitions where their founders have passed, particularly when it’s a very iconic founder, it is, not in every case, but I think it’s a challenge I’ve seen in several different places to transfer the business development responsibilities to the new generation. So, long story short, Joe was following a bunch of my LinkedIn posts that I did when I left Extell because, I mean, given I wasn’t developing because I couldn’t find the equity and the debt fast enough.

Eve: [00:20:35] The capital, yeah.

Atif: [00:20:36] So I had to fill the rest of my time doing something. So, I was making LinkedIn posts and Joe saw this and he was like, hey, you seem like a really interesting guy. Would you want to come and just grab coffee? I said, funny enough, I’m actually at my parents’ place, which is like five miles away from your office. Let’s meet tomorrow morning for coffee. So I met him and then I invited him to a panel that I was hosting at the Harvard Real Estate Symposium on Entrepreneurship and Intrapreneurship within our industry and we just started, on the way up, we were just like talking a lot about how does he, as a firm, reach out to a new generation of potential customers, who are now in their 30s and 40s leading development firms all across the country? And we said, you know, both of us listen to podcasts. Let’s just do it, let’s figure it out. So, we basically came up with our plan, what we wanted to do. We dug into our virtual Rolodexes of friends in the city, and the thesis that we wanted to bring was, let’s talk to a new generation of developers and the ones that you don’t see on the cover of the Real Deal, the ones that you don’t see on every single industry panel, though, and you know exactly what I’m talking about, all of those people. So that’s what we started with. And I think we really kind of struck a chord with people. We got some really great guests on. So, Vishaan Chakrabarti from Practice for PAU, great, great architecture design studio. Marion Gilmartin, Melissa Birch. A whole set of people that are really amazing. So our 75th episode we recorded yesterday with Keith Rand from Mill Creek Residential. So yeah, that’s basically the path.

Eve: [00:22:23] And what have they told you? What have you discovered in these interviews?

Atif: [00:22:27] So in each of these interviews we wanted to get to the heart of it is, the why of what they actually were solving for it. What was it that drove them to develop this building or design this building? And what is it that a listener can take away from them to understand what is the future of our industry going to look like? Generally speaking, that was season one and two and then three focused much more tightly on housing in the greater New York City area. And we included, started including a journalistic style monologue in the beginning that talked about a certain issue in great depth. So one of the ones that I thought was really fascinating was where did the modern system of home mortgages come from? Like, how did that even start? So, we kind of go all the way back to FDR, the 1940s, and describe that process on the way back. So that’s what made this season a little bit more unique than the other ones.

Eve: [00:23:26] Interesting. But what have you learned about developers, this next generation?

Atif: [00:23:30] Do you know? What I would say is this, as that as easy as it is to stereotype our whole industry as being in it for the money, which is usually what people yell at me when, I’m a city planning commissioner in Hoboken as well, so that’s usually what people in the audience will yell. They just yell indiscriminately aloud from the audience. And a couple times I’ve also done like the so tell who are these developers you’re talking about? But I think what, so what I’ve learned is that there are many people that aren’t that and there’s many people that care about the place that they develop. And there’s many people that care about the people that are going to live in, work in or enjoy the buildings that they’re creating. And that’s something that is deeply inspiring because I think the other description or stereotype of our industry tends to dominate the public psyche.

Eve: [00:24:22] I think that’s true. And then what about architects, this next generation of architects? How is the industry changing? Is it changing? Because, you know, architects are very undervalued on the whole. And I’m, I’ve puzzled for years over why that isn’t more actively addressed because I think they bring enormous value. But I’m not the norm in that thinking, right?

Atif: [00:24:51] Yeah, I think that it probably comes to something that my therapist would say, which is about boundaries. And I think that architects are terrible at creating boundaries in terms of what they will do versus what they won’t do and how they value themselves versus what they will give away for free with the hope of being able to get something else. And I think perhaps an old school way of thinking about this is what H.H. Richardson said, which is that he’ll design anything from a cathedral to a chicken coop. And I think the new-age version of this is where an architect’s values overlay with what they will actually do. So, for example, Vishaan Chakrabarti, the architect that I mentioned, makes it explicit in the manifesto for his business, he will not work for authoritarian regimes. He will not design a prison. So, and he is not interested in doing stuff related to law enforcement. So, I think that all of those areas and declarations are the beginnings of this boundaries of saying that this is me, this is what I do, I am valuable. And if you choose to value me, this is the price associated with it. And if not, somebody else will. That’s the tough one.

Eve: [00:26:08] I really admire that. But I’m thinking of value in a much broader sense. Like, I walk around my neighborhood or where I have my little cottage and I’m just appalled when I see the buildings that are going up in a place that has such distinct character. And the buildings are thrown up by builders who have never been trained to recognize that character or replicate it or build anything that fits into it. And architects are not even a thought. They’re just not a part of the conversation. And so, we end up with really wonderful places being just ruined over time by either an unwillingness to think about what it means to put up a building and the space it creates. And I am, I’m appalled when I talk to people about this who don’t know what architects do saying, but they’re so expensive why would I why would I need one? The builder can do that for me. I’m just puzzled at why the architecture industry hasn’t been able to find a way to talk about its value broadly.

Atif: [00:27:20] Yeah, I think that there is this element of, um…

Eve: [00:27:25] Elitism.

Atif: [00:27:26] Elitism. I think this idea that you poor people don’t deserve nice things and architects don’t work for poor people. And I think the, what I think about is also the minimization of our trade by the increasing presence of legality and fear of lawsuits throughout every aspect of our industry. So, I think the AIA has done a wonderful thing by codifying contracts that our industry uses as our norm for both owners, architects and contractors.

Eve: [00:27:57] And builders.

Atif: [00:27:58] And builders. Yeah. And I’ve read those contracts as a principle. Like I’ve needed to read all of those contracts when I’m hiring a contractor, I’m like, gosh, architects, we’ve really backed ourselves into a corner. And when I think about, let’s go all the way back to one of the greatest, still one of the greatest buildings of all time is the Taj Mahal. So, the head architect, his name is, was, Sir Ustad Ahmad Lahori. So funny side story, he’s essentially a Pakistani that designed in India, which is a whole other side story. But the amazing thing is that, um, as an architect, it wasn’t like he just drew the drawings and was like, okay, you do it and if you have a problem, I’ll probably sue you. Or if you want to sue me, let’s go to court. His whole responsibility was everything, including the supply chain. And what I found so amazing is he was responsible for the team of people that were getting all the precious stones and all the precious materials like Jade from China, Tourmaline from the Middle East, all of these different things. And they all spoke all these different languages. And he was responsible for all of that. And I think that owning of the whole process is what allows architects to truly be maximized in their value in the way that you’re describing.

Eve: [00:29:11] Yes, but I still puzzle over how that’s ever going to be brought into, you know, everyday lives because streets, neighborhoods, blocks are ruined by poor design, and then we all get to enjoy that.

Atif: [00:29:28] I mean, there’s some avenues. Let’s think, so, I mean, it’s not like us having to turn the clock all the way back to the, I guess that would be the 1400s when the Taj was built. Maybe I’m off by a century two, something like that. But I mean the idea is citizen commission. So, I think participatory democracy in some ways is a very good thing. And I think having planning commissions and zoning commissions and historic commissions can have positive benefit there. I think perhaps another one that’s not a fully baked idea, but the idea of perhaps making real estate more accessible from an investment perspective, I think there’s a really beautiful thought process around that. And then I would say…

Eve: [00:30:07] You mean like we’re doing at Small Change?

Atif: [00:30:09] Exactly! Yes.

Eve: [00:30:11] Oh, yeah. That’s how you build wealth, right?

Atif: [00:30:14] Completely, and I think that there should be, the way that the SEC thinks about and regulates funds at a larger level, I think being able to think through and structure and support the great work that Small Change is doing and people that are looking to invest at the smaller scale sounds like that’s something that’s worth effort from a legislation perspective and maybe even a funding perspective rather than huge amounts of money thrown at infrastructure to the tune of billions of dollars through the last two major bills and the Biden administration.

Eve: [00:30:44] So what was your favorite interview ever, and why?

Atif: [00:30:50] Okay, so my favorite one ever, and I love all my babies, all my babies are wonderful, all my episodes. But my one that I think of in particular is the episode I did with Louis Schump, who’s a creative director at Gensler, on the subject of the West Side Pavilion, which is Google’s new headquarters in Los Angeles. And it’s essentially, it’s a conversion of the mall that was featured in Clueless, the movie, into a mixed-use office complex. And as part of that, we talked a lot about the goals of Google and the, I guess you could say, the largesse of a large company like that to be able to promote good urbanism at a large scale. And then one area that we explored is just reeling it back. How did America get so many malls to begin with? So, both of us are amateur historians.

Eve: [00:31:45] And what are we going to do with them now? Right?

Atif: [00:31:49] I have an aunt, a great aunt, who is from Toronto that I’ll see in a couple of weeks. And every time I see her, she has the most creative ideas of what to do with, she’s not even in real estate industry, but she’s the most creative ideas and the one that she said nearly like a decade ago, far before the pandemic, she was like, hey Atif, basically what I do every day is I drive to the mall and all the other Indian aunties, we just walk around the mall together. And then sometimes we have to go to other places to pick up our grandkids and we go to other places to drop them off and then we come back. Wouldn’t it be great if there was like the mall just became my house and then the day care was there too, and then my son and daughter just lived nearby. Like, wouldn’t it be cool? And I’m like, oh my God, you hit on it right there, that’s it. That is what, that’s what malls should be. Multi-generational housing.

Eve: [00:32:37] If you want to live in that environment, that is. Because I’m not sure I could do it. Okay. So, one final question. Unless you have another company you want to explain to me?

Atif: [00:32:52] Any other companies, I would say no, I’m good for now. We’ll stay a three.

Eve: [00:32:56] You’re good for now, okay. So, one more question and that’s what’s next for you?

Atif: [00:33:02] Good question. So, we’re, for Commonplace, we’re coming up to a fundraising milestone. So, we’re excited about that. And we hope that that will allow us to expand our product offerings, our vision, our scale and bring on some more great talent to help us do that. And I think that there’s a couple other ideas I have in the works in my head. One of them is the investment portfolio that I have and scaling that perhaps to a much larger scale, allowing folks to be able to invest in workforce and affordable housing more easily on an individual level. That’s probably something a bit separate. And then the one that I love, which I feel like this is this could be the final one that I ever do, I call it, lovingly, it’s the wedding planner for high end home renovations. So, I literally, every month or so at least some family members, some neighbor, some friend from college is like, oh, P.S. I just bought a $5 million brownstone in Brooklyn. Can you just do, like the whole renovation? Because I know you did such a good job on it with your parents’ house. And I’m like, there has to be a business here. And that would be so much fun to do.

Eve: [00:34:17] So, you’re not even sure what’s next for you?

Atif: [00:34:22] One of all of them is the potential next one, so we’ll figure it out.

Eve: [00:34:26] Well, it’s been a pleasure talking to you. You’re such a high energy person. I can’t wait to see what you do next.

Atif: [00:34:31] Thank you so much for the opportunity, Eve. I love your podcast. I love everything that you’re doing and I’m so looking forward to seeing you again at our next Small Scale Developer Forum in just a couple of months.

Eve: [00:34:43] Can’t wait, in the beautiful Savannah, right? Okay.

Eve: [00:34:53] I hope you enjoyed today’s guest and our deep dive. You can find out more about this episode or others you might have missed on the show notes page at RethinkRealEstateforGood.co. There’s lots to listen to there. Please support this podcast and all the great work my guests do by sharing it with others, posting about it on social media, or leaving a rating and a review. To catch all the latest from me, you can follow me on LinkedIn. Even better, if you’re ready to dabble in some impact investing, head on over to smallchange.co where I spend most of my time. A special thanks to David Allardice for his excellent editing of this podcast and original music. And a big thanks to you for spending your time with me today. We’ll talk again soon. But for now, this is Eve Picker signing off to go make some change.

Image courtesy of Atif Qadir