Rethink Real Estate. For Good.

Visionary

Social Impact Hero.

“As part of my series about “individuals and organizations making an important social impact”, I had the pleasure of interviewing Eve Picker” writes Yitzi Weiner for Authority Magazine.

“Eve Picker is the founder and president of Small Change, a crowdfunding platform that enables developers to raise capital for real estate projects with social impact. She is a trained architect with extensive experience in urban planning, real estate development, and community building. Under her leadership, Small Change, which was founded in 2016, has helped 39 developers raise over $10 million for projects in 21 cities, big and small, across the United States.”

Want to read the entire interview? Click here!

Image courtesy of Eve Picker

No more broken promises.

Brinda Devine has over 25 years of experience in real estate, beginning at age 29 with Acquest Development, where she earned her real estate broker license and served as their Vice President of Asset Management. She then joined Wayne State University, where she established a Real Estate Office which facilitates the purchase and sale of land and buildings for the University, and she became the university’s first Real Estate Officer.

Much of Brinda’s real estate career has been influenced by her race and gender – she notes that early on in her real estate career, Brinda was often the only woman and/or Black person in the office, in meetings, at events, and even in classes. 

In 2020 she decided to take the step to become a real estate developer, starting P8 Real Estate Solutions, to focus on developing neighborhood marketplaces within Detroit neighborhoods that lacked easy access to the daily necessities most of us take for granted. During the last two years, Brinda says she’s learned that the number one challenge of being a woman, particularly a Black woman developer, is getting access to capital. Her first project is the Kornr Store, and is a kind of development prototype that will provide what Brinda calls ‘life essentials’ – like coffee, healthy food and drink options, prepared food, home and personal goods, green space, internet access. She’s raising funds for this project on Small Change.

Brinda is an active member of Urban Land Institute, and a member of their Small Scale Local Product Development Council. She is a co-founding member and treasurer of Detroit’s Women’s Sustainable Development Initiative, and was also a member of the 2020 Cohort of the Equitable Development Initiative in Detroit, through Capital Impact Partners. Brinda is also an author of two books – Discover Your Value, Discover Your Purpose, and Authentication Process: Connecting the Dots of Being a Believer and Living a Life of Purpose.

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. If you haven’t already, check out all of my podcasts at our website RethinkRealEstateForGood.co, or you can find them at your favorite podcast station. You’ll find lots worth listening to, I’m sure.

Eve: [00:00:56] Brinda Devine boasts of a 25-year career in real estate, working her way up to VP of Asset Management with Acquest Development. And then at Wayne State University, where she established a real estate office which facilitates the purchase and sale of land and buildings for the university. Much of Brinda’s real estate career has been influenced by her race and gender. She’s Black and she’s a woman. She notes that early on she was often the only woman and or Black person in the office, in meetings, at events, and even in classes. In 2020, Brenda decided to switch seats at the table by launching her own real estate company, P8 Real Estate Solutions. She is focusing on developing neighborhood marketplaces within Detroit neighborhoods. But now, being Black and a woman have become a challenge to her like never before. Brinda Devine has a big story to tell, so listen in.

Eve: [00:02:09] If you’d like to join me in my quest to rethink real estate, there are two simple things you can do, share this podcast and go to rethinkrealestateforgood.co, where you can subscribe to be the first to hear about my podcasts, blog posts and other goodies. Good morning, Brenda. Thanks so much for joining me today.

Brinda Devine: [00:02:32] Good morning. Thank you for inviting me.

Eve: [00:02:36] You’ve had a pretty interesting career in real estate, 25 years of it. How did real estate become your career path?

Brinda: [00:02:44] Well, that’s a little crazy. I actually didn’t know anything about commercial real estate. I was about 25, 27 years old, left a banking career, answered a wild ad in a newspaper, the Sunday newspaper. Went to an interview, just going to find out about things and ended up getting the job out of 300 applicants.

Eve: [00:03:08] Wow.

Brinda: [00:03:09] Yeah. Surprised me, too. And I actually work for a wonderful developer who trained me from the ground up of not knowing anything and he was a colorblind individual. He did not see color, race, he just wanted to make sure that you were on the team and that we all were working towards the same goal. So, a beautiful gentleman.

Eve: [00:03:37] And so, over 25 years you worked with him and then you were the first real estate officer for Wayne State University as well, is that correct?

Brinda: [00:03:46] Yep. So, I stayed with the developer about 12 years and then I ended up applying for a position at Wayne State. They created an officer of real estate and joined there in 2005 and started that office for the university. And at that time, and I think that’s still the case, the office was actually led by an African American woman of color. A person of color. The real estate office for the university. So that was, I don’t think really too many people think about it that way, but that’s, I thought it was significant, particularly with the impact with development in the city, particularly the the midtown area. So, it’s been interesting.

Eve: [00:04:37] Very good. So, you’ve spent 25 years in the real estate industry and only recently you decided to take the plunge and create your own development company. What made you do that?

Brinda: [00:04:50] So, I’ve been blessed to be on the opposite side of the table to do business with developers. And I’m going to say that every one of them that I’ve dealt with, they were Caucasian males. I’ve not had a project with. No, I take it back one one Black developer I did a project with. So, I was thinking I needed to get from behind a desk and see what the reality was for developers on the opposite side of the table. I decided at the beginning of 2020 that I wanted to be a developer and I sought out a class through Capital Impacts EDI program, which is essentially a development class for minority developers. And it was eye opening. Being on the opposite side of the table of getting a lot of feedback and information on how that process works and how it is so much different for Black developers than the developers that I had been working with.

Eve: [00:06:00] And on top of that, you’re a woman, which, you know, I was the only female developer in Pittsburgh for many years. So, I can only imagine you’re a rare breed. So, how has that impacted your career? And you said this was eye opening and in what way was it eye opening?

Brinda: [00:06:21] So, I’ve been in commercial real estate. I usually work with men, white males. And so, I can say that I’ve been sort of trained for that type of environment. It doesn’t bother me being the only person in the room. I have typically been the only woman in the room, the only Black in the room, and I adjusted to it because my personality is pretty direct and that’s just a different pace when you’re working with developers. So, that didn’t really bother me because I fit my personality. And so, I understood that world of real estate, of coming in, talking to someone about your project and that there would be funds available. One, two, three, easy. I wanted to see what it was like on opposite side. And what I found out is that it is full of challenges, it’s full of broken promises, it’s full of. And because I’m analytical and because I don’t come from that background, I have the ability to sort through information to go, okay, this is not really working. Why is this process not working? And be able to look into it a little deeper, because I’ve not been in that realm, and I could take a look at it from a first look. So, it was eye opening because I just saw processes that did not work and because the majority of the people who who many of them have, I would say for the not-for-profit side, they’re in this realm where they’ve committed themselves to do good and they are in these programs and they’re trying to help people. But the problem is they are not developers. They have absolutely no idea. They’re program managers. And it’s really hard to make something work when you don’t have any feedback on what that feels like or what that process is. And working, it’s all sort of like it’s just a process without actually having the experience, I put it that way.

Eve: [00:08:31] Right. So, it doesn’t sound like it’s impacted your career very much, but now that you’ve become a developer, what’s that like?

Brinda: [00:08:41] It’s been very frustrating because from my background, when I look at what, when I used to be an analyst and work for a developer and what was required to do a deal. But then when you’re a woman or a person of color and you’re reaching out to lenders for funding, there’s always something that’s missing. There’s this big cloud of a big veil of information that is uncertain. People are interested in your project. They love the idea. They want to meet and talk about it, they want to help. And then the day after you get a call that, well, you know, I went to the team, and we talked about it and we don’t really think your project fits. How does a marketplace within within a neighborhood not fit? There’s always some level of criteria that there’s something that astounds me, that they don’t have the expertise in the beginning to analyze that. So, it’s been very, very frustrating. And you have to have a huge level of resilience about yourself and determination to push through your project, irregardless of what someone says or what they say they’re going to do. And then it doesn’t happen. You have to have this resilience about you. So, it’s been frustrating, but I also find it fascinating, and I find it challenging to be able to figure it out and get it done.

Eve: [00:10:25] Well good for you because it makes me want to cry. Really. I mean. I don’t even know what to say. So, we are not at the point where an equal society. That’s for sure. Right.

Brinda: [00:10:40] Yeah. I have the opportunity to be associated with an organization that listens to me. A not for profit, the Urban Land Institute that listens. And I’ve shared my perspectives and experiences and I’ve had a good opportunity just a couple of weeks ago to pitch my project at a committee meeting, and I took the opportunity to make it a teachable moment. I would say you should expand your circle. You should expand your friends, the food you eat, where you drive, places you go. Developers are often embedded in one area, and with this set of friends that I grew up with to school with and da da da. And so, their perspectives are limited and so their environment is limited and the information that they receive is limited.

Brinda: [00:11:30] So, when you give someone an opportunity to share your experience and expand their circle, I can pose it in a way for them to understand what it would be like if they were in the same scenario. So, they can have an emotional attachment to the problem that I’m talking about. I’ve gotten a lot of feedback from people of I really had not thought about it like that. I really had not considered that. You know what, I really need to do more about that. And that could be as simple as referring someone for a job, hiring someone, adding someone to your team, and you’ll get a different perspective, a different understanding to expand your circle. So, that’s the approach that I’ve been going at, just being vocal about it. I think sometimes we don’t we don’t really talk about stuff. We try to be politically, too much being politically correct and not just speaking out and being direct in our conversation.

Eve: [00:12:29] I love the way you talk about it, so I’m going to ask you, with all of this experience wrapped up, what sort of projects have you decided to focus on with your real estate company?

Brinda: [00:12:39] Okay, so personally, I am solution and purpose driven in the capital impact classes for the minority developer program I mentioned, I was exposed to a lot of information, research, market data, demographics and the consistent stream through Detroit and a lot of urban areas like Detroit is that there is a lack of healthy food options within the neighborhoods and there’s a lack of personal and home goods. And I found that it’s a good percentage of people shop at their convenience stores, the dollar stores, the gas stations. Even though Detroit is a motor city, there is a huge percentage of adults that don’t have access to a car and during the pandemic, not necessarily access to public transportation as well. So, there is a need for a typical what you call a, what I grew up with, a corner store within the neighborhood. You can pick up your essential life, essential things, you know, some groceries, some healthy snacks, some healthy foods and things, some coffee, some prepared foods.

Brinda: [00:13:52] There’s a lack of that in the neighborhood. There’s a big gap for the small-scale developments. They’re more inclined to 1 million and up. And so my niche is to focus on developing small scale marketplaces within emerging Detroit neighborhoods. I don’t think that’s an insurmountable task. You know, I’ve heard someone say, Well, that’s a novelty. And I had to challenge him and say, it’s not a novelty to have a store to go to. You actually go to a grocery store, and you eat on a regular basis. That shouldn’t be something that you have to consider what you’re going to do. And they hadn’t thought about that, just like I had not thought about it before I took the class, and I expanded my circle. So, eating is not a novelty marketplace. A corner store is not a novelty in a neighborhood. So, just to get past that whole notion, but I try to make it funny but try to make it serious as well.

Eve: [00:14:57] So you’ve got a first project that you’re working on, Kornr store. How did you find it and what neighborhood is it in?

Brinda: [00:15:04] So, it’s in the Northwest Goldberg neighborhood of Detroit. It’s not far from some long-standing partners here before, Northwestern High School, Motown Museum. I’m actually, I have been working on a model for this type of store for probably about for over two years. And I happened to mention to someone that I have been looking for a building, and they happened to mention this neighborhood, which I was somewhat familiar with. And I walked through the neighborhood, and what’s interesting about the neighborhood, there’s not that many parcels that are zoned for commercial. So, there were two buildings that were vacant. I look them both up, I found out who owned them both. One of them, I was a Facebook friend. And then I saw that we had a mutual friend and I asked for an introduction, and we got along very well and we had a mutual interest in the building of what it is. The building is actually a 100-year-old building. The original owner in 1904 went down to the city of Detroit and had it zoned for that parcel to be a grocery store. So that grocery store has fed that neighborhood for years.

Eve: [00:16:16] That’s lovely.

Brinda: [00:16:17] And that’s what it’s been. And the person was initially purchased it to do the same thing, but it ended up being too small for their use. And so they had been waiting for someone who had the same type of mindset. So, we agreed on it and he sold it to me, and I actually felt as if he was passing a baton to me because it’s a long legacy of feeding a neighborhood. And I just was grateful, if someone had told me a year ago that I would be doing this, I would have said that you were crazy. But purpose leads you to places that you would not think that you would land. And I’m just grateful that he trusts me enough to sell me the building.

Eve: [00:17:11] So how big is it?

Brinda: [00:17:13] The building is about 1600 square feet. There’s commercial space on the first floor which where the corner store would be. And then above there’s a two bedroom, two bath. And oftentimes I get asked, what, don’t you think that’s too small? I’m like, no, it’s the perfect size because it fits within a neighborhood.

Eve: [00:17:33] Right. And how are you going to drag it into this century? Like what’s going to be different in your store versus the way it used to be?

Brinda: [00:17:41] Well, that’s a good question. So, what is going to be different? I have a small team. One of my team members is out of New York and she has a lot of good ideas. And I’ve done a lot of research on different marketplaces outside of Michigan. Actually, Michigan’s kind of slow in terms of advancement and technology for convenience stores. So, one of the things in this will have to be scaled and I have to start at square one and scale up. But one of the things that’s going to be different is we’re going to have, of course, a coffee bar, but we’re also going to have another type of bar. And I’m not going to say it because I don’t want anybody to take my idea. We’re going to have this other type of bar that has to do with food that I have found that people are so entrenched, and they love this type of food and to eat it all day and we’ll have that type. But we’ll also have some healthy food and drink options and some groceries and such and some artwork and some wine and some of the typical things you find in the convenience store. But the Kornr Store brand is also about being an amenity to the neighborhood, but also a neighbor.

Brinda: [00:18:58] So, during the weeks’ time when there is a lull, let’s say a Friday, nobody’s really thinking about going to the corner store on a Friday, late afternoon or Thursday. We’ll have some time to activate different activities that we’ve been planning for community engagement. The neighborhood has a huge percentage of senior residents and also young mothers and then older gentleman, and we’ll plan events around the neighborhood, different activities that they can do. So, we can engage and use the space and also engage with local pop ups, maybe have some wine tasting events, maybe have some tutoring events. I have a multitude of friends that have finance backgrounds, real estate, architecture, legal. They can do different tutoring sessions or just have different topics that would interest the neighborhood. A birthday month for different seniors just to connect and to say that we’re here. We’re a neighbor. Yeah, I want you to shop. I want you to come by. But the very first thing I want is that when you walk through that door that you feel like you belong here. I’ve gone into other places, and you feel like you don’t belong there. Like the neighbors, the residents who have held it down for so long won’t feel welcome. I want the people in Northwest Goldberg, those neighbors to feel like they can walk in, and I’ll have something for them and I’ll have something for other people. I have something for guests. I have something that will peak someone’s interest if they feel like when they walk in there, they feel like they’re welcome and they feel good.

Brinda: [00:20:44] That’s what I want to get out of this, that they feel good when they come in and then they stay for a while, then they leave. But that they feel good being in the Kornr Store that that brings back that emotional connection of the corner store that I grew up with. And I tell people all the time when I say corner store, this is emotional feeling of like, that’s the place where you used to go pick up something at the last minute. That’s the place where you actually went and found out what was going on in the neighborhood. That was the old school Internet of going in and finding out the news of what was going on. And I want that. I want people to feel like they can walk in and feel good about being there.

Eve: [00:21:23] You’ve talked about the challenge of financing a project like this and a project led by a Black woman. But you’ve added crowdfunding to the mix, which is an extra lift. Why investment crowdfunding. Who do you hope will invest?

Brinda: [00:21:40] Being the analytical person I am, I’ve placed applications for lenders, and we talked about that. And real estate, as you know, is about timing. And I needed another platform other than just the lender, I needed to have something that connected, that a person could read the story, they could understand, okay, this is a good idea. This is the right time. That’s why I reached out for the crowdfunding. One of the things I’m finding about with lenders, I mean, some of them seem to be in a small spot, a place, and they can’t really embrace the whole idea of Kornr Store because they have hundreds of loans going by. But when you have an opportunity to read the story, to read what I’m focused on, this isn’t for me. I didn’t pick this. It picked me. And in real estate, I truly believe that you should have a project that’s bigger than you. And this project is definitely bigger than me. It is totally out of my comfort zone, but it is much needed, and I am in at 100% so.

Eve: [00:22:55] So it’s really small but mighty, right?

Brinda: [00:22:58] It’s small but mighty and it has. And I tell people all the time, you don’t have to have huge projects to make an impact. You can have a small project and make an impact. Would a 200-unit apartment really impact the neighborhood? Or will you have an impact by putting in a smaller footprint that impacts the neighborhood and retains its personality? Smaller projects have big impacts as well.

Eve: [00:23:29] Talking about that, how have the neighbors welcomed you and this project?

Brinda: [00:23:34] They have welcomed me because I was respectful. I came in as a person. I came in as a human. I approached people as humans. I was respectful of the layers of history, the neighborhood clubs, the dynamics that go on under the surface. And because I was respectful and didn’t come in, like, I know everything, I’m this and that. You know, these demographics say this and that. I mean, demographics can be skewed as well. They can be biased. So, I came in as a human and approach my project as a human and the people that live there. That’s why the Kornr Store is an amenity, but we want to be a neighbor. So, planning a neighbor in a place. And so, I have been welcomed very well. I’ve been introduced to the person before the person I purchased the building from. The building has a crack of grocery store. It’s known in the neighborhood as that. And I met the owner who I believe he’s 83. We met online and he actually provided me with a story of how he actually came into acquiring the store, which I found fascinating. It was more information, more history. And I could tell when I first saw the building how it was respected because there was no graffiti. It wasn’t damaged. It’s 100-year-old building and it’s structurally sound. So, that told me a lot about how the neighborhood feels about that store.

Eve: [00:25:19] Yeah. One more question about it, and that fascinated me when I learned about this project. And you said that you will try to incorporate items to sell in the store that actually made by neighborhood residents. How has that come together?

Brinda: [00:25:34] So in Detroit, there are a lot of people who have small businesses, and we have a lot of incubators for small businesses that have been going on even before the pandemic. So, there are a lot of entrepreneurs here, a lot of artists, musicians and such, and I have it on my website that if anyone is interested in selling their items in the store, I have the opportunity to buy their products, even like authors. I have quite a few friends that are authors. I like to have a few books by local authors or have them pop up and do a pop up about their products or their books or their services. And I think that’s important because it gives them an opportunity to have access to a space without having to go and pay for a space. And they’re a start-up as well. I would definitely believe in spaces that have multiple uses.

Eve: [00:26:33] So once this one is put to bed, which I’m sure, yeah. What is the timeline, by the way? When are you hoping to get it finished?

Brinda: [00:26:41] I just had that phone call today. So, I could actually have the business open up by the end of this year. I’m ready to go with the permit and everything. The problem is the financing. I really need the financing to get this going. I’ve put in quite a significant amount of my own money, so it’s not like I’m sitting here going, okay, I want everybody else to put their money in but me. No, I’ve done that. We’re at the point where we are ready to start construction and as soon as we can start, that would be fantastic for me.

Eve: [00:27:16] You’d be underway. So, once it’s finished, what’s next? I’m sure you’re thinking about the next one.

Brinda: [00:27:22] Oh, yeah, I’ve already. I’m already looking for the second one. I’m already looking for another location for the second one. So that’s the idea behind the Kornr Store model is that it can fit in a residential lot. So, I am already looking at a second location, more than likely to lease that one. But this very first one, this one is the most important. It sets the tone for everything else. So yeah, the idea is to scale this model within Detroit and then elsewhere.

Eve: [00:27:57] So Brinda, I love the idea and I want to come visit as soon as it’s finished. I can’t wait to see it. And I wish you all the best of luck.

Brinda: [00:28:08] Thank you. I appreciate you. You know, I appreciate you. I do.

Eve: [00:28:12] Thank you so much for joining me.

Brinda: [00:28:14] No, thank you for inviting me. Thank you.

Eve: [00:28:23] Brinda Devine is a rare breed. She has spent most of her real estate career as the only Black and the only woman in the room. And she got used to it. Now she’s facing a different challenge with the first real estate project that she’s tackling on her own, access to capital.

Eve: [00:28:51] You can find out more about this episode or others you might have missed on the show notes page at our website RethinkRealEstateForGood.co. There’s lots to listen to there. A special thanks to David Allardice for his excellent editing of this podcast and original music, and 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 Brinda Devine

Slaying Gentrification.

David Kemper wanted to find a way to safeguard established renters against gentrification. His goal was to build a real-estate investment model that both stabilized existing rents and gave a voice to that community. Too many have suffered from racism and disinvestment in their neighborhoods. Across the country, communities are being torn apart because residents are being priced out of the neighborhoods they have called home for decades. Just as resources and new opportunities come to a community, its longtime inhabitants often get pushed out.

So David and his team are working towards an alternative: cities with inclusive, mixed-income neighborhoods. These diverse and dynamic neighborhoods will deliver better economic, social, and health outcomes, especially for lower-income residents. The model they have developed, MINT (or Mixed-Income Neighborhood Trust), is a sophisticated and replicable ownership model. Each MINT develops, owns, and operates a rental housing and retail portfolio. MINTs harness the money coming into communities to keep rent affordable for existing residents. Trust Neighborhoods, David’s non-profit, works with neighborhood-focused organizations to facilitate the formation of each MINT with the goal of a self-sustaining organization, run by the neighborhoods themselves. This gives neighborhoods equal footing with developers contributing to the gentrification taking place.

David and his co-founders started Trust Neighborhoods in 2019 and have since launched three MINT pilots in Kansas City, Missouri and in Tulsa, Oklahoma and Fresno, California. They have already shown to be beneficial. But they are just getting started. Neighborhood Trust is growing, and they hope to work with neighborhoods across the country, forming MINTs in each city and protecting community members who have too often been overlooked. 

Read the podcast transcript here

Eve Picker: [00:00:08] 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. If you haven’t already, check out all of my podcasts at our website RethinkRealEstateForGood.co, or you can find them at your favorite podcast station. You’ll find lots worth listening to, I’m sure.

Eve: [00:01:00] David Kemper wanted to find a way to safeguard established renters against gentrification. His goal was to build a real estate investment model that both stabilized existing rents and gave a voice to that community. The model he landed on, MINT, or mixed income Neighborhood Trust, is a sophisticated and replicable ownership model. Each MINT develops, owns and operates a rental housing and retail portfolio. Trust Neighborhoods, David’s non-profit, works with neighborhood focused organizations to facilitate the formation of each MINT, with the goal of creating a self-sustaining organization run by the neighborhoods themselves. Trust Neighborhoods is still new, but David has said that they hope to expand their reach and work with neighborhoods around the country. Listen in to learn more.

Eve: [00:02:01] If you’d like to join me in my quest to rethink real estate, there are two simple things you can do, share this podcast and go torethinkrealestateforgood.co, where you can subscribe to be the first to hear about my podcasts, blog posts and other goodies.

Eve: [00:02:30] Hello, David. Thanks very much for joining me today.

David Kemper: [00:02:33] Thanks very much for having me on.

Eve: [00:02:35] You launched something called Trust Neighborhoods in 2019. And I wanted to ask you first, what problem are you trying to solve?

David: [00:02:45] Yeah. I’m one part of the three of us who are leadership at Trust Neighborhoods is Kavya Shankar and Jason Dehaemers, and the problem we’re trying to solve is that you have neighborhoods which have experienced disinvestment over decades, often from racist reasons, that now are finally having investment come into them and becoming a higher opportunity, both by public efforts, by private efforts and a lot of efforts on the part of current residents. But just as those neighborhoods are becoming higher opportunity, the very residents which are most deserving of participating in that and have often contributed so much to creating that experience a second injustice of being displaced from that neighborhood, not only denying them that experience of living in a higher opportunity neighborhood, but often even creating harm beyond that prevention of opportunity and around that problem is why we started working with neighborhoods through our nonprofit Trust Neighborhoods to help set up these mixed income neighborhood trusts.

Eve: [00:03:41] When did this need become clear to you? What’s the journey you took?

David: [00:03:46] We followed different paths in the leadership team. My particular path was through working at New York City government in affordable housing, and that was first in a department there called Housing Preservation Development, where I got to do a lot of refinancing of LI-tech which low-income housing tax credit deals and HUD multifamily deals, which is really the current meat and potatoes of American affordable housing finance. And you both saw how those worked at volume and the non-profits and neighborhood-based organizations that use them and also where it wasn’t working, which is especially around what real pinpoint anti-displacement looked like.

David: [00:04:22] The city of New York at the time was then interested with the arrival of de Blasio and really pinpointing neighborhoods where likely gentrification would create displacement. And a lot of the effort was around creating inclusionary zoning to prevent that displacement. And I had the good fortune to be part of the team who was working on that, and then a new team that was set up in capital planning in the city planning department and trying to work with neighborhoods facing that pressure to proactively prevent displacement. But there’s kind of this rhetoric in New York, which is wonderful, but, you know, New York is everywhere. And there’s this idea that they would build a model and it would work for the whole country. And I grew up in Kansas City and have stayed deeply appreciative and tuned into a lot of cities like it. And you see this phenomenon playing out across the country, including Pittsburgh, certainly very familiar with it.

Eve: [00:05:12] Oh, yeah.

David: [00:05:13] And the mechanism is not going to be that you’re going to prevent displacement by incentivizing what’s going to happen when a five-story building is torn down for a ten-story building. A lot of the displacement and change in ownership and lack of control is happening long before that. So, the same principles are playing out, but you really need to focus on building a different kind of set of tools. And fortunately, both found others who cared about, and we had the time to work on this, but most of all spent time with a lot of neighborhood based organizations in neighborhoods that had either undergone gentrification or facing it. And really sat down with them and said, what are your pain points? How are you spending your days? What are you looking at for tools? And almost consistently you had this need identified of saying, if we could just have our own ownership group, that could really do cross-subsidy in our neighborhood in a way that we could raise outside capital akin to the developers we’re competing against that can move at the speed of the market. It’s not applying for a grant for a house that gets receipt that that grant was received months after the house was sold and really do it at the scale at which we were experiencing displacement. And bit by bit, we worked with some neighborhood partners on honing that model, launching pilots, and now we’re working to get out across the country.

Eve: [00:06:31] And that model, you call it MINT, right?

David: [00:06:35] We call it MINT, a mixed income neighborhood trust.

Eve: [00:06:38] So tell me precisely how it works.

David: [00:06:40] In some ways, it’s very simple. Some ways a little more complex. We help the neighborhood set up this mixed income neighborhood trust. It is an LLC which has all of its voting shares controlled by something called a perpetual purpose trust that is somewhat distinctive from some uses of trust models where there’s not national trust, there’s a legal trust which is assigned to a purpose agreement which controls all the votes of this new entity. That trust then has a trustee group which has the existing neighbor based organization on there and resident representation and adheres to a purpose agreement which we work with residents, the neighborhood based organization, on writing when we’re setting this up, which really identifies what anti displacement means, what protect me belonging means what long term financial sustainability for this new institution looks like and then really build in also details and nuances, that are particular for each neighborhood. That serves as a long term constitution that then this operating company of the Mixed Income Neighborhood Trust has to adhere to as it buys, develops, and then long term owns a mixed income portfolio, which today we’re entirely focused on housing in a way that prevents the displacement of residents in that neighborhood.

Eve: [00:07:57] So the trust is actually a developer.

David: [00:08:00] In some ways. It’s a vehicle to allow a neighborhood to serve in a developer function for its neighborhood. And the way we’ve set up is that each mixed income neighborhood trust will have a general management function, which is essentially a budget line that goes back to the neighborhood-based organization. So you aren’t building duplicative new institutions. You’re really building the capacity of groups that have been on the ground, have legitimacy, have been doing the hard work, and too often are then excluded from actually having that level of control and autonomy within their neighborhood as it experiences this kind of pressure. So really important for us is not just hitting numbers on preservation of affordable units, but really also changing power structures in these neighborhoods where especially women and people of color have been precluded for so long.

Eve: [00:08:50] I’m trying to wrap my head around this. It sounds pretty powerful. So if a new developer comes to the neighborhood and purchases a property outright, what control does this Trust or MINT have?

David: [00:09:04] It is just in parallel with that. There’s no outright authority it has. It’s more putting the neighborhood on more equal footing with a lot of more conventional developers that may be participating in a neighborhood that is facing gentrification.

Eve: [00:09:17] I see, okay. And so, how is a MINT portfolio designed?

David: [00:09:23] So one of the one of the key things we begin with is really doing an analysis with the neighborhood-based organization of what does protecting displacement need, what is the real need in the neighborhood. An example of this is one of the first neighborhoods we worked with was in Kansas City, Missouri, in the northeast section of neighborhoods there, and the neighborhoods called Lykins. And from a parcel view of housing in that neighborhood, they have 1700 units of housing and 900 of those are rental housing with basically zero regulated within that. They are next to a neighborhood that has had some of the fastest rising rents in the city. They’re beginning to experience that same pressure coming on the side of them. So, the beginning was talking with residents saying, look, you have 900 households that are renting in this neighborhood at this average rate. What does it look like to make sure that those households, some of those will move into homeownership? Some of those will not be necessarily having their income rise as fast as the market is rising. What does it mean to protect them from displacement and then working with them to identify how can we maximize the preservation of those units? What does cross-subsidy look like from likely rising rents and unrestricted units we put under that same ownership group? So it self-finances affordability, which works for a subset of neighborhoods and then saying also what is feasible?

David: [00:10:40] In terms of what are rehab partners or construction partners you can work with and what kind of volume can they work with? What is the churn happening in a market? Is this a neighborhood where you’re seeing hundreds of units bought and sold every month or is this something where you’re seeing a dozen bought and sold every month and then putting together a capital stack that makes that feasible. We really do that whole hands-on diligence process with them and service a lot of the short term capacity which a lot of neighborhood based organizations just don’t have to set up that kind of vehicle. But then once it’s set up with that governance, with those partnerships in place for renovation, for property management, and that scope of of what they want to be building in as their own ownership, as much as possible we then build their own autonomy to be running that and attuned at the neighborhood level as they build that ownership and manage it in an accountable way long term.

Eve: [00:11:27] So tell me, how long does it take to go through this process, from thinking about it to actually forming a group that’s governing itself?

David: [00:11:36] Yeah, I mean, we’re kind of figuring it out. We did the two pilots. We are in the midst of a third one right now. We’re in the midst of a fourth one right now. So, we’re learning exactly what the long term process looks like. It’s probably about nine months to a year in terms of our experience, but it may be that right now, I think one of the bigger bottlenecks has been capital appetite, especially for more philanthropic sources. And we’re building it so that long term can take in non-philanthropic sources that are okay with low returns, which certainly can move faster. We don’t know what looks like if that bottleneck is not there for how fast it happens.

Eve: [00:12:12] Interesting. So, the pilots, where are your pilots and where’s the third one? Kansas City and.

David: [00:12:17] Our pilots are in Tulsa, Oklahoma. Certainly, a really meaningful place to get to work, especially in 2021 with the memorial of the race massacre there. And then in Kansas City, which is also where we’re based and very meaningful to work with a neighborhood in our own home in a way that is disciplining and really holds us to doing quality work. The third, which is currently in formation, is in Fresno, in central Fresno with some really great neighborhoods there as the downtown is experiencing growth and preserving a lot of housing stock as well as hopefully providing alternative to owners that have been in the neighborhood they would like to have purchased out.

Eve: [00:12:58] So how far are these experiments in? Like the the MINTs are formed? Have they purchased properties? What are they doing?

David: [00:13:08] Yeah. As noted, Trust Neighborhoods came together in 2019. We really worked with the neighborhoods and the pilots and on the whole scoping and 2020 and both those pilots launched in early 2021. So, they’re just over a year old right now. But both have really seen promising signs so far. They both control well over a dozen units of housing. I think the one can see is almost up to two dozen now.

Eve: [00:13:30] Wow.

David: [00:13:30] And out of that is some real glimmers of hope, both in terms of just operational efficacy, seeing the governance really have resonance in that governance. But most importantly, some of those of early glimmers of impact, like the Mixed Income Neighborhood Trust in Tulsa, which was set up with Growing Together, which is focused in the Kendall-Whittier neighborhood, is the Kendall-Whittier Neighborhood Trust and I was actually just out there last week as they did a celebratory open house for another one of the renovated units that’s open, and had both residents and contractors and funders and everyone all together having paletas really feeling the promise of the work. But alongside things like that were it’s a deep renovation project, they’ve had ones where they’ve just bought housing that was for sale in the neighborhood and been an alternative to a lot of what are kind of unsavory buyers and sellers in that neighborhood, and there was one that was selling and a they bought it and the seller told them, you know, every other buyer told us they were going to clear out the residents in these units in order to renovate them and re rent them at a higher rate.

David: [00:14:37] And instead the Kendall-Whittier Neighborhood Trust was able to own them and have all the residents stay in place along with the budget, to actually improve the quality of those units of housing discovered families that are in the school, which is a place based school that would have told you’re not able to come back to your school with your kids on a couple of months’ notice of a new school year. So, it was a real change to instead get a knock on the door from the Kendall-Whittier Neighborhood Trust saying, hey, look, you’re not only in a safe place versus this threat which is facing you, but we’re also here to make sure that you’re not displaced as this neighborhood continues to become a better place.

Eve: [00:15:17] That’s very powerful. So how do you plan to scale? I mean, how many neighborhoods will be successful?

David: [00:15:24] Yeah, that’s a lot of a lot of our focus is yeah. From the beginning which which may be distinctive in some ways is that we really have had an eye toward saying we are not content if this happens for a dozen units in one neighborhood, the scale of the need in just one neighbor is larger, that the scale of need across the country is hundreds of neighborhoods which are very rapidly changing. And we at this point get a lot of cold outreach from neighborhoods across the country that say, we’re interested using this model, we’ve heard about you, can we work together? Our biggest limit on that side is our own capacity of a team as we grow that team and grow our own operational ability.

David: [00:15:59] But we’re really focused on building our own team to be this short-term service, which is a big piece, is really being able to step in and work with neighborhoods across the country on setting it up. A big part is building long term capital supplies. We’ve had a generous supporter who has come in for funding the design of a fund that will be the national with ready capital, which we hope will solve that bottleneck issue and help build that overall market, which can bring in a lot of capital which is not usually participated in both community governance models and models focused on anti-displacement and changing power structures in this way. And then a big piece is just learning from each neighborhood trust and really powerfully having them start to build their own peer group in a way that is self-reinforcing, builds us as a better support partner, but also can build on their own experiences, lessons learned interpretations from those governance bodies of what anti displacement really looks like and very hard decision making moments. And then also step in as they discover things which are even more valuable to each neighborhood trust. And already the two pilots have met and compared notes. And we think it will only get stronger as you have more and more mixed income neighborhood trusts in the country working these neighborhoods for the residents.

Eve: [00:17:14] So that was one of the questions I have. Like, community engagement is really hard. Do you experience friction when you set up one of these? Like what does it take to get everyone on board?

David: [00:17:29] Community engagement is hard, but what we’ve been doing with the Mixed Income Neighborhood Trust is so different from a lot of what more conventional community engagement is. I think the place to pinpoint there is, we are helping the neighborhood-based organization set up these entities that have residents in long term governance. And that is very different from a typical project where there is a community engagement period, which then ends and residents never have another maybe not even another voice, much less any actual real power in that institution or project. And residents are smart, and they get it. And if they think they have a six-month engagement process to try to convey all the complexity of experience in a neighborhood and any possible thing in this, that will be a very hard process. And instead, with this both, I think we’ve worked with really great partners on designing community engagement, which both make for very productive sessions, where people come into it already with a sense of having had time to do one on ones with everyone and talk through their experience and have that as a, as a jumping off point. But then the most important thing is they then step into the actual governance long term. So, there’s a real ability to keep on iterating and having a voice in the model and in this new institution in their neighborhood. That’s actually something I think we thought was going to be a lot harder and has been really energizing to spend time with residents who just get this and are excited to have this kind of institution as a vehicle for creating this kind of change in their neighborhood.

Eve: [00:18:56] So how big is your team and what sort of skills are represented at the moment?

David: [00:19:01] Not very big. Five of us full time right now. We’re doing some hires right now.

Eve: [00:19:05] Small but mighty, right?

David: [00:19:07] Yeah. Part of the building up the capacity to actually take on the scale of problem and our skill set is mixed. Kavya had been out in the White House and had done organizing work as well as some amount of investment side work. And then Jason is utterly brilliant all things finance, governance and had really worked more in the investment banking, private equity world and then some corporate governance and just delights in building out an actual new financial structure which is solving for things that are more complex than just making money. And then my background was more in the affordable housing finance community development side. We’ve got two wonderful more junior members of the team, Natalie and Ben, who have both actually come through Venture for America, which has been a great source of team members and a delight to work with.

Eve: [00:19:55] So you’ve been working on this a little while. I’m sure you’re thinking about improvements. How could it be improved and why? It can’t be perfect, right?

David: [00:20:04] A big thing is the pilots in place as they grow. And I think then building out their own governance and being improved in that way.

Eve: [00:20:13] This is a pretty entrepreneurial idea. So, entrepreneurs never sit still for very long.

David: [00:20:18] Yeah, I think a big part of the improvement also is building that peer group in terms of having the neighborhood trusts speak to each other more. Building out just a lot of the capital familiarity. Right. There’s a risky moment at the beginning of saying, can you put money into a new vehicle that is creating this kind of impact, and will that really work? And as we start to see them work, that makes it so it’s a lot easier for the next one to say, yes, I want to see that happen too. I think as each neighborhood-based organization kind of learns what what means to be taking this on and building into their existing institution. And as you varied organizations right now, they’re, one is a neighbor association, one is one of the purpose-built communities, one is a CDC. So, as you start to have a peer group of different kinds of neighborhood focused organizations that are using this, that will make it even better.

Eve: [00:21:06] And do you think this is really unique? Is there anyone else doing similar work?

David: [00:21:11] There are aspects that are unique in their aspects that are very familiar. A lot of the land trust community and world, I think, is using community land trust towards similar spirit and functions. But I think unique here is the ability to use the outside capital, the outright control of the land versus separation, the focus on, there’s a lot of renters being displaced, There’s a big focus of this, versus a lot of CLTs tend to have more home ownership focus. We early on have met with a lot of peers across the country that we sort of think are doing relevant, familiar work. And a big part of ours is not having too much pride of authorship of really learning for others. A part of that early on is we were calling this a mixed income land trust and we spent time with the Kensington Corridor Trusts out in Philadelphia. And they said, hey, look, you know, we’re really trying to establish more the terminology of a neighborhood trust here. And we said, sure, great, we don’t we don’t have any pride of term here.

David: [00:22:04] We have a really great to actually be part of helping build on what you’re doing. So, we decided to call it a mixed income neighborhood trust. And so a noted MINT kind of sounded nice too. So, that was part of it. We’ve also liked a lot of the shared equity worlds and built out. The Kresge Foundation include us in the community of practice of several groups working on shared equity models, which certainly plays into a lot of what you in Small Change have also been building into and that’s been really great to be part of. And Elwood Hopkins, who’s led that has just been a great champion and convener. And then I think also on, if you see models and neighborhoods facing gentrification that have relatively succeeded in doing cross-subsidy to the benefit of their neighborhoods. Some of those have come out of almost less conventional models than necessarily a community developing corporation. Where if you look at what the Hasadim community has done in South Williamsburg, in New York, it’s experienced massive gentrification pressure, which, because of ownership and cross-subsidy, has in many ways actually made it more affordable for that community through their cross-subsidy and ownership of land. Likewise, you see some of that with some of the Chinatown family societies in New York, and you see a couple of clusters of that in different places in the world. And there are some community development corporations, I think, use their assets. We right now are working with the East Boston Development Corporation in Boston, which has been both an amazing partner to work with and also the way in which they’ve built out the organization ownership and building their own self-financing mechanisms is really in line with what we’d like to see this model enable for more neighborhoods. So, it’s been amazing to get to work with them as a partner in that.

Eve: [00:23:39] So, how many more neighborhoods do you think will have mint in one year or three years from now?

David: [00:23:46] One year. A few, but three years. We’d like to see actually getting up to really doing this at scale.

Eve: [00:23:55] And what does success look like to you?

David: [00:23:57] Success looks like living in a country where we have cities that have mixed income neighborhoods led by especially residents that had been excluded and discriminated against, especially black and brown leadership of institutions that are creating high opportunity neighborhoods that work for everyone. And not only does it hopefully make it so that those neighborhoods become very high opportunity neighborhoods in a way that works for a mix of incomes and identities there, particularly each neighborhood, but also it stops this phenomenon in America where we’ll see investment go into one geography. And there’s almost this assumption that you’ll end up not serving a large chunk of residents who will get displaced somewhere else. And then almost, then you’ll continue to see a cycle where you’re chasing poverty to different geographies, just as all these efforts to try to improve a place come to fruition. Instead, we stop that. I think with half a dozen MINTs in each American city, you could actually create a thing where at the core of each American city are these mixed income neighborhoods which are robust, wonderful, I think could be some of the best neighborhoods in the country. And you also have this window of opportunity, the United States, where we buy deep tragedy of racism and suburban investment. We’ve ended up with the cores of our cities being massively underinvested and undervalued. But, we in many ways are the anomaly in the world on that. And we’re seeing our appetite shift where the cores of our cities are becoming the most valuable places, which is much more akin to everywhere else in the world. It would be a tragedy, I think, to then see us also just have it where if you don’t have the money, you can’t afford to live anywhere near the middle of the city.

Eve: [00:25:39] I think that shift is already happening.

David: [00:25:40] Yeah, we have we have a window of opportunity, I think, for a crucial subset of neighborhoods to at least secure some place near the center of the city that especially carries such deep meaning and current social capital institutions in a way that could create a very different kind of city.

Eve: [00:25:58] I’ve been living in a downtown myself for quite a few years now and have gone from being one of the first residents to one of many who look very affluent to me now. And it’s disturbing. I really feel like the vitality of mixed people using a place is really being wiped out. So, I agree with your argument here. So, I have one more question for you, and that is what keeps you up at night?

David: [00:26:29] Oh, lots of things. At the very beginning, I really did not sleep that well. There’s a lot more stress and things, I think. As we built out a really quality team that’s helped with the sleep. Journaling helps the sleep. You know, you write down your worries.

Eve: [00:26:46] I’m so glad it’s not me alone.

David: [00:26:48] Then you don’t have them bouncing around your head in the middle of the night. I mean, you always you always kind of swing back and forth too, you have this thing where you go, there are moments where you go, oh yeah, this is doing great and we’re going to run with it. There are moments that you go, oh, is something going to hit us that we aren’t expecting and everything’s going to fall apart? And I feel fortunate that more and more of the days are the former.

Eve: [00:27:09] Yes, yeah. Or there are moments where it’s like, why am I doing this? It’s a very hard road.

David: [00:27:16] We’re up against a daunting scale of historical injustice, of momentums, of other forces in the world. So it’s understandable. It’s hard, but there’s also hope.

Eve: [00:27:27] I think you’re also up against greed, unfortunately. So, the gentrification of neighborhoods is going to continue. The question is, is how many can you catch and save? Right.

David: [00:27:39] Yeah. I think the hardest thing for us right now has been when we have neighborhoods that say we really want to work with you, now is the moment. And we’ve just had to say we just don’t have the capacity to work with you right now. And that’s been really hard.

Eve: [00:27:54] That’s heartbreaking.

David: [00:27:55] I remember one very early on going, well, you know, whether or not you work with us, we’re going to be here fighting displacement, our neighborhood. So, it’s not so much are we going to work together and find displacement more? They’re going to be there doing it regardless. It’s just really hard to not have the ability at this point to say yes to everyone and get these in place with the speed which with these words are changing.

Eve: [00:28:20] Is there any like white label option that you can create for do-it-yourselfers?

David: [00:28:26] We’ve occasionally sent along pieces. Unfortunately, it’s just, I think a big reason why we built the team is that a lot of people know all the principles, it’s just, don’t have the capacity in a team that actually will step in and run with it. So, that was, we have no pride of that. We’re happy if someone else wants to do it. Just a big part is building the team to be able to actually say yes to more places and run with it.

Eve: [00:28:52] Well, you’ve chewed off a huge problem, and I really hope you’re super successful and I can’t wait to see where you are in three years. Maybe we’ll have one in Pittsburgh or 2 MINTs.

David: [00:29:05] Yeah, we’d love that.

Eve: [00:29:07] That would be fantastic. Yes. Let me know if you need any introductions.

David: [00:29:12] Yeah, well, if they’re are neighborhood based organizations, this resonates with their priorities and what the neighborhoods are, then. .

Eve: [00:29:18] There’s tons. I feel like someone once told me that community development work started in Pittsburgh. It’s got an enormous number of neighborhood-based organizations. I helped found one myself, a CDC. So, every neighborhood has one. It’s a pretty active place that way.

David: [00:29:37] Well, we’ll follow up. Definitely.

Eve: [00:29:38] Yes, definitely. But thank you very much and congratulations and good luck.

David: [00:29:44] Eve thank you.

Eve: [00:30:01] You can find out more about this episode or others you might have missed on the show notes page at our website RethinkRealEstateForGood.co. There’s lots to listen to there. A special thanks to David Allardice for his excellent editing of this podcast and original music, and 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 David Kemper

Before IMPACT was a thing.

In college, Paul Rabinovitch planted almost a million trees. Seeing the clear-cut land in which he was working sparked a desire to center his work around creating change. His career path displays a multitude of avenues towards making an impact – from brownfields redevelopment, to building sanctuaries and parks with the Nature Conservancy, to working as an impact investor in real estate.

Now Paul serves as the Head of Real Estate Investments at New Island Capital, a family office that centers its work around impact. New Island Capital was one of the first investment firms with a focus on impact.Now impact investing has come into the mainstream with more firms and family offices looking to bring positive change with their investments every day. New Island brands itself as being 100% for profit and 100% mission driven. The office prioritizes long term investments that bring meaningful social and environmental change at the same time as maintaining profit and competitive returns. They invest in various sectors including clean technology, health care, renewable energy and of course, real estate. Real estate investments are made in markets where the residents are supportive of sustainable assets, as well as those in need of social equity and workforce housing.

Paul sees real estate as an opportunity to benefit people’s lives in a tangible way. There is longevity in real estate – buildings impact residents’ lives for decades, even centuries – which emphasizes the importance of adaptable, restorative, and regenerative development. In his varied work with both conservation and real estate, Paul has witnessed the organic growth of places. That is his goal – to build change that benefits people and the planet.

Read the podcast transcript here

Eve Picker: [00:00:08] 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. If you haven’t already, check out all of my podcasts at our website RethinkRealEstateForGood.co, or you can find them at your favorite podcast station. You’ll find lots worth listening to, I’m sure.

Eve: [00:00:57] Early in his career, Paul Rabinovitch worked as a tree planter in the reforestation industry, personally planting over 800,000 trees in Canada, where he grew up. That set the stage for the career he pursued. First as the executive director at the Nature Conservancy in Arlington and then as founder of TerraCycle Investments, a socially conscious real estate firm. His mother is a real estate developer, and Paul followed her lead, weaving in the social responsibility that so interests him to his real estate career. Now, Paul heads up real estate investment at New Island Capital, one of the largest family offices in the country, and one of the first to focus on impact investment before such a thing really existed. New Island invests in commercial scale, growing companies providing private credit, private equity and project finance. They also invest in farms, forests and of course, real estate. At New Island, Paul gets to invest in real estate with social impact at scale. You’ll want to hear more.

Eve: [00:02:15] If you’d like to join me in my quest to rethink real estate, there are two simple things you can do: share this podcast and go to rethinkrealestateforgood.co, where you can subscribe to be the first to hear about my podcasts, blog posts and other goodies.

Eve: [00:02:37] Hi, Paul. It’s really great to have you on my show today.

Paul Rabinovitch: [00:02:40] It’s great to be here. Thanks for inviting me, Eve.

Eve: [00:02:42] So I wanted to ask you about New Island Capital, where you work, and the company defines itself as both 100% for profit and 100% mission driven. And I wanted to just ask what that means.

Paul: [00:02:57] Sure. That’s a great question. New Island Capital was formed a couple of decades ago almost, and it was formed on the premise that we can invest towards triple bottom line returns where profits do not exclude creating environmental or social benefits. And really, the company was formed around that thesis that we can do both and there are meaningful opportunities for us to invest in things that make a profit that would be equal to what you would make in a conventional or traditional type of investment, but also drive really great social results. And that’s what our company is all about. We are 100% what’s called now impact investors. Back then it was double or triple bottom line investing. And we invest in real estate, and in businesses, companies as well as being active lenders across a lot of different spaces, ranging from health care to real estate to health and wellness and renewable energy, clean tech, a lot of different sectors.

Eve: [00:04:11] So you mentioned returns. And I’m wondering like, do you do you get as good returns as regular non-impact investment? Is that really possible?

Paul: [00:04:23] Yes, it is Eve. And I’d say there’s one important distinction to keep in mind, which is that we are long term investors, and sometimes we call that being patient capital. And so, our usual investment horizon is ten or fifteen years, and we do that intentionally as long term investors. One reason is because we invest on behalf of the family office. So, we’re investing for multiple generations, and we can think longer term. That’s one reason. The other reason is that we invest a lot of capital upfront in some of those social benefits. And an example I would use would be solar panels. So, we would invest in putting solar panels on the building right up front. And we know it would take seven or eight years before we’re at a break even on that investment. But then every year after that, it’s accretive to our bottom line. So, when we compare ourselves to other investors, we compare it on a ten- or fifteen-year horizon. And then we’re very competitive because by then, by the tenth or twelfth or fifteenth year, some of those upfront investments are beginning to bear fruit, so to speak. And we are outperforming what people are doing on the shorter-term horizons that that are more in vogue these days.

Eve: [00:05:41] Interesting. So, I’m going to go back to New Island Capital. Why does it exist?

Paul: [00:05:48] New Island Capital really exists because it was the experience of our family office that started us who was really interested in investing in alignment with their core values and their beliefs. And they had been shown a number of ESG screened kind of investment opportunities to invest their wealth in alignment with their values. And really their drive was not so much how do I do less bad in the world? Their drive was, how do I do more good in the world? And there weren’t at that time, this is going back a couple of decades, a whole lot of opportunities to invest with that kind of an idea. And so, our firm was born out of that idea. Now there’s a lot more impact investing firms that are out in the marketplace. It’s been really a pretty rapid rise of impact investing as a practice, which I think is really encouraging and exciting.

Eve: [00:06:47] So what’s your role at New Island Capital?

Paul: [00:06:51] So my role here in New Capital is I’m the Head of Real Estate, and responsible for all real estate investments for the company, as well as part of the senior leadership team in the investment committee and overseeing all the investments across all the various specialties that we have here.

Eve: [00:07:11] And I’d love to know, first of all, how you find triple bottom line impact real estate investment opportunities. And a second part to that is what percentage of the opportunities do you look out really kind of meet your goals, and what are some of the examples of the types of investments that New Island has made?

Paul: [00:07:32] Well, let’s talk about how do we source opportunities first, and you know, our approach to sourcing opportunities, projects where we want to deploy capital into is sort of the reverse of many other capital allocators that are in the market. And what I mean by that is that many other capital allocators, family offices or pension funds or what have you go through a sort of a research driven approach to say, well, where is the best market in the United States or in Europe or wherever they’re working? And where do we want to invest? They may pick an area like, let’s say, Pittsburgh, just out of the blue or some other wonderful city like that. And then they go look for a good sponsor that is an expert in developing in Pittsburgh or whatever geography they’re working in. We’re the reverse because we are 100% impact oriented. The bottom-line returns, the impact outcome is just as important as the financial outcome, and not all sponsors are the same. They’re not all equal because we need one, a partner who we believe, and trust is in alignment with our goals. So, our process is go find the best impact developers in the country and then underwrite them and the market that they work in. So, we come at it backwards. We go sponsor first, who are the best sponsors, what are their markets? And if those two circles intersect and we like the developer sponsor and we like the market, then we have a place that we can really have a conversation around.

Eve: [00:09:08] So I’m wondering if that’s the way you look at it. Are the markets that you generally end up in not the hottest markets in the country?

Paul: [00:09:16] It’s an interesting question. Not necessarily. No, I wouldn’t say that, Eve. I would say that the markets that we are ending up in right now are some of the fastest growing, most progressive markets in the country. And the reason I say that is one of the themes that we work in is sustainability and building net zero energy, operating buildings, low carbon buildings, buildings that perform at the highest levels of resource efficiency, water and energy efficiency and all those sorts of things. And so, if you’re going to build a building like that, you need to have a market that accepts it and might be willing to pay a little bit more in rent or might be really attracted to a building product that’s like that. So, we tend to be in markets where there’s a more progressive market tenant base that would be attracted to those kind of assets. So, we’re in markets like Seattle, Boulder, Colorado, and we’re not in markets that are less interested in those kinds of products. So, sustainability is a good example. And then, we also do a lot of work in social equity and workforce housing. And so, we’re also in some markets where workforce housing is in short supply and so, and high demand. And so, we work in those areas as well and some of those markets are really terrific as well.

Eve: [00:10:44] Oh, that’s interesting. And so, what are some examples of the types of investments that New Island has made?

Paul: [00:10:51] As I was saying earlier, we’re really interested in accelerating and supporting a transition to a low carbon economy. And so, we work in investing in buildings that have the lowest carbon footprint that you could design towards. So, there’s a couple of projects that we have that are CLT Cross Laminated Timber construction. That construction type is about 50% lower embodied carbon than a steel and concrete building, for example. So, those, we think that’s sort of the future of where we want to, if we want to try to become a low carbon and we want to try to combat global climate change, that’s the kind of buildings that we need to be building. And so, we invest in buildings like that. We also invest in buildings that have high solar or renewable energy components to them. And so, they’re in sunnier places. We’re investing in a project in Huntsville, Alabama, that will be net zero energy from solar contributions. We also invest in the workforce housing, as I was saying, and trying to figure out how we can create without government subsidies, housing that is affordable to what used to be called the middle class, the population that is usually comprised of schoolteachers and firemen, policemen, the essential economy of our society who are having a harder and harder time finding places to live in that don’t burden them for, the housing cost does not burden their family budget. So, our goal is to try to develop properties where a middle-income, middle-class family can afford to live without spending more than 30% of their budget for that housing.

Eve: [00:12:36] And without spending 2 hours commuting to their job, right?

Paul: [00:12:40] Correct.

Eve: [00:12:41] Is that really horrible issue.

Paul: [00:12:43] Yeah, that is part of the issue.

Eve: [00:12:47] Go ahead.

Paul: [00:12:48] Well, the last part of it, which I also think is an interesting part of our work and because we are long term holders of real estate, as I was saying earlier, where we’re holding assets for ten plus years, we also think about how can we layer on additional impact to a project over time, maybe we can’t afford it when we build it to put on solar hot water, but we could put that in in year three. Maybe we identify that the area that we, that our building is going up in is a food desert and really needs to have an organic co-op on the ground floor and we can put that in, or is a banking desert and needs to have like a co-op or a community bank on the ground floor. So, we think long and hard about how do we improve the communities in which we’re investing, and that is a tangible impact that we measure. And then the last part is who are our partners, and can we diversify our partners so that they’re representative of our society, that we have women developers, we have developers of color, we have all the developers who are trying to emerge into the field. So that’s another part of our impact as well. That is part of what we’re trying to create.

Eve: [00:14:11] So going back to family office operations, which impact operations were pretty rare, as you said, 20 years ago, but tremendous private wealth is consolidated around the world and family offices. How much wealth do they hold?

Paul: [00:14:28] It’s in the trillions, Eve, but I don’t know specifically. Family offices to be candid about, I’m not necessarily tracking, I happen to work within, for a family office, but I don’t necessarily track the sector. But you’re right, they’ve been growing rapidly. But there’s also not necessarily like a registration or a way of tracking how much money is actually managed there or, it’s a little bit I don’t want to say shadowy, but it’s a little bit you know, it’s not something that is out in the open where everyone knows the number of family offices and how much wealth do they have under management. It’s a little hard to track.

Eve: [00:15:08] One of the articles I was reading is that why some people with wealth have tended towards family offices because they have a little more leeway in what they can do with their funds than, for example, a hedge fund or a venture capital fund or something like that.

Paul: [00:15:28] Yeah, that’s true. And, you know, it could be to the best. You know, the story that I told you about New Island Capital is around a family who has wealth that wanted to do more good work with their capital and their wealth. And so, I think that there are many family offices. I know there are, because I speak to them frequently about cooperating on projects that have similar ideas. And I think there’s a lot of encouragement to be had from the next generation of family wealth. Perhaps the founders may not hold some of the same values, but this next generation that’s upcoming is from everything that I read and everything that I hear is very desirous of seeing a world that works better for the environment and for social justice and for other issues and equity. So, there’s more and more family offices that are looking at the same way that we are.

Eve: [00:16:25] So yeah, we generally seem to be experiencing the mainstreaming of impact investing. And I’m wondering, you’ve been in this world for a while and how much has it changed over the last decade?

Paul: [00:16:39] Well, you know, that’s very interesting. It has changed a lot is the short answer to it. And I think that has changed, you can measure it and think about it in a lot of different ways. One way is how much money is there that’s in the sector and that has certainly grown. How many other companies are there? It’s been a long time since I started in this work, since I had other colleagues that I can talk to. Now there’s a lot, and there’s conferences and there’s more and more people who are doing this kind of work and thinking about it. And I think even though you didn’t ask me about this, particularly as a lot of the work that family offices have done to invent and think about impact investing has now kind of evolutionarily moved up the ladder into institutions. So now, you know, Goldman Sachs, Nuveen, any of the major banks and financial institutions you can think of, as well as many life insurance companies and pensions have impact investing shops. Larger capital providers are also sort of following the trend and building out that sort of, that strength and that practice, which I think is really encouraging.

Eve: [00:17:54] It is. And I was just going to say, like when you did your degree, it was probably unusual. But now I hear about more and more impact investing programs and students emerging who want to work in that world, right?

Paul: [00:18:09] Yeah, absolutely. I’m ancient, so there was no such thing as this when I was in school. But you’re right, now it’s being taught at school. You know, like on this podcast, I’ve been asked to speak to students and tell them about what I do for a living and why it could be a good career choice for them. I just did that for a group of students at University of Colorado, Boulder and they were, they were fascinating and fascinated. And I thought it was great.

Eve: [00:18:41] That’s really cool. So, I have to ask, there are clearly areas that are receiving a lot of attention from impact investors, but do you feel like there are some big holes that still need to be plugged? Some areas that really need help?

Paul: [00:19:00] The leading component of impact investing would be the environment sustainability. And I would say that that is by far the, the bigger appetite that I see people investing towards. You know, that could cross a lot of different areas, it could be clean tech, it could be green buildings, it could be sustainable food and our food supply chain. So, if you think about it as ESG, there’s a lot of “E” that people invest into. And I think it may also be that that is the part of impact investing world that may be the easiest to track and has the longest, it’s got the greatest longevity. We’ve been talking about it for 20, 30 years, and so it’s finally got some traction. That would be sort of the top of the list. I would say the second most emergent that I’ve noticed has been social equity and diversity, mostly driven out of the racial unrest that we saw over the last few years and just a great drive together with opportunity zones in some way to create greater economic opportunities for diverse populations, and populations that have been overlooked for decades and decades, or have lost the opportunity to create wealth for themselves through institutional racism and other institutional barriers to advancement. So that, I would say, would be the second largest. Your third question is, are there areas that are not being addressed?

Eve: [00:20:42] Those two actually encompass a lot, don’t they?

Paul: [00:20:46] Yeah. You know, the one area that I think I’m really interested in and our family has been talking a lot about and which I think is really interesting, is community ownership and different ways in which, and your, Small Change is a part of the solution to that is how do people invest in real estate or invest in their own communities? How do they make, how do you build up your community around you and also profit from it and create wealth? And how does that work in our society? I think that’s an area that has, there’s a lot of people thinking about it and not a ton of examples. Your Small Change is one example, but there’s also ideas about neighborhood rights. There’s examples about community land trusts. There are other examples that are out there of different ideas about how do we structure these kinds of opportunities.

Eve: [00:21:40] So, I think for me the big difference is that the environment is and the issues that environment are really mainstream now. Everyone knows they can, they understand, even if they don’t want to do it, that they can have a small part in making a difference whether they recycle or put a solar panel on their roof or, you know, whatever small step they can take, it’s really at the level now that everyone can grasp. Right. But I think that creating equity for people is not something that most people can grasp and not something that most people understand how they can help. Does that make sense?

Paul: [00:22:18] I think it does, yeah. We’re tactile people and it’s very tangible when you see a solar panel on a roof or rain barrel or something like that, you you get it. Some of the other things that you mentioned are kind of more a little bit more conceptual. They’re not as tactile.

Eve: [00:22:37] Yes. Yeah. So, I want to go back to your background, which is really interesting Paul. What led you from planting trees, which is where you started, I think, to directing impact investments in real estate?

Paul: [00:22:50] So, yes, you’re right. I started planting trees when I was in college. I’m Canadian and one of the best ways for Canadian students to make money for their beer budget for the next year is to go north and plant trees. The Canadian government set up this regulation that any tree that’s cut in Canada has to be replaced at the cost of the timber company. So, they hire these legions of undergrads to come and plant trees. And I’m proud to say that over my lifetime I planted a million trees.

Eve: [00:23:25] Oh, wow.

Paul: [00:23:27] I can breathe easy, I suppose. I’ve created my own oxygen budget. But, you know, part of that experience was if you’re going to be a tree planter, you’re going to be sent to an area that was clear cut and you’re going to have to reforest it. And so, it just really impacted me at that young age to be in these clear cuts all summer long and seeing moose wandering around lost and birds and what, where the forests go. And it would be hectares and hectares of just nothing. And it was, it changed my mind about what I wanted to do. And I had the good fortune of being raised by an architect mother who taught me the business of real estate. And I sort of put those two things together and said, well, I can use what my mom has taught me about real estate and start building green buildings and recycling land. And so, I started off as a Brownfields redeveloper, and learned the business of green building. And then along the way, I also learned about low-income housing tax credit projects and historic tax credit projects and have done all those kinds of projects over the course of my career, mostly in cities, almost entirely in cities. For one part of my career, I also took about a 9 to 10 year hiatus to go join the Nature Conservancy and use my real estate skills to help the Nature Conservancy build more nature sanctuaries and parks. And so, that’s been my career as an impact real estate developer, a conservationist, and now an impact investor.

Eve: [00:25:06] It makes a lot of sense. So, a couple of final questions. What do you like best about the work you do?

Paul: [00:25:14] The way I look at the world is real estate is this opportunity where you can really have a beneficial influence on people’s lives in a very tangible way, whether it’s where they live or where they work, they are spending the majority of their time there, they’re raising their families there. They’re experiencing these places that are being built every day. And so, the process of thinking about that and how these assets that are long term assets they could stand for 40, 50, 6000 years can be adaptable and restorative and maybe even regenerative, I think is a fascinating question and a really worthy place to work. But for me, that’s really gratifying work. It’s hard. There’s not easy solutions. There’s a lot of trade-offs. But if I’m going to work somewhere, working somewhere where I can benefit people and planet is just super gratifying to me. And if I get to make money along the way, too, that is awesome.

Eve: [00:26:19] That’s the triple bottom line, right?

Paul: [00:26:21] Yeah. And I also, you know, I really enjoy watching the organic growth of places. Most of the projects that I’ve done in my career have been in places that are distressed in some ways or have some environmental contamination. They’ve been derelict, things like that. And to watch them come back to life and then spur other life, it’s sort of like seeds being cast from a from a tree and then new sprouts coming up. I find that super gratifying and exciting.

Eve: [00:26:51] Well, thank you very much for talking to me today. I really enjoyed it and I hope I get to hear more about what you’re doing.

Paul: [00:26:58] Absolutely. This was a ton of fun. Thank you, Eve, I appreciate being on.

Eve: [00:27:06] Paul holds an enviable position as the director of real estate investment at New Island Capital, one of the largest family offices in the country. Here he has the opportunity to focus on impact investment in impact at scale into farms, forests and of course, real estate.

Eve: [00:27:33] You can find out more about this episode or others you might have missed on the show notes page at our website RethinkRealEstateForGood.co. There’s lots to listen to there. A special thanks to David Allardice for his excellent editing of this podcast and original music, and 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 Paul Rabinovitch

Citizen architect.

From an early age, Rico Quirindongo was interested in the impact of the built environment on people. That’s why he became an architect. But he sees an architect’s role as much larger than just designing buildings with a useful life. He believes every architect has an obligation, a responsibility to engage in a civic conversation for design justice – to absorb the history of a place and the needs of the current community in a meaningful way, into each and every design.

Rico started his career as an architect in St. Louis, MO, and later moved back to his hometown of Seattle to work first with Donald King, and then with the DLR group. He has been twice recognized by the AIA as a citizen architect – in 2011 and again in 2020. The AIA looks at more than just the physical aspects of architecture. They also value the architect’s ability to uplift diverse voices, influence social change, and bring about community engagement – all of which hold great importance in Rico’s work.

In 2021, Rico took on the role of interim director at the Office of Planning and Community Development for the City of Seattle, hoping to increase the scale of his social impact. This role feeds his soul. Here he can push harder for what he believes in. Positive results are already rolling in. The trajectory of the Seattle Midtown Square project was significantly altered when Rico gave the local community a role in its planning. The development was transformed from a building of 430 units with a CVS on the corner into a destination location featuring a not-for-profit organization, an artist residency location, an art gallery, and more.

Rico’s success stories show us the amazing results that collaboration can bring. He reminds us that local residents – those who know and love their neighborhoods – can bring a fresh perspective, helping developers create buildings that benefit the people.

Read the podcast transcript here

Eve Picker: [00:00:09] 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. If you haven’t already, check out all of my podcasts at our website RethinkRealEstateForGood.co, or you can find them at your favorite podcast station. You’ll find lots worth listening to, I’m sure.

Eve: [00:01:04] From an early age, Rico Quirindongo was interested in the impact of the built environment on people. That’s why he became an architect. But he sees an architect’s role as much larger than just designing buildings with a useful life. He believes every architect has an obligation, a responsibility to engage in a civic conversation for design justice, to absorb the history of a place and the needs of the current community in a meaningful way into each and every design. Recently, Rico became interim director at the Office of Planning and Community Development for the City of Seattle. The city he has lived his life in, and this role feeds his soul. Here he can push harder for what he believes in. Positive results are already rolling in. Please listen in to hear more.

Eve: [00:02:13] If you’d like to join me in my quest to rethink real estate, there are two simple things you can do, share this podcast and go to rethinkrealestateforgood.co, where you can subscribe to be the first to hear about my podcasts, blog posts and other goodies.

Eve: [00:02:39] Hi Rico, I’m just delighted to have this opportunity to talk to you today.

Rico Quirindongo: [00:02:44] Morning.

Eve: [00:02:45] It’s very early for you. Yes.

Rico: [00:02:49] I’m an early riser, so it’s okay.

Eve: [00:02:51] Oh, well, that’s good. Yeah. Let me start by asking you, you know, a big question. What led you to move from an international design practice to a planning department in Seattle?

Rico: [00:03:03] Well, I would want to take a step back. So, I began working as a Black architect. Actually, I started working as a Black architect in St Louis at a Black owned firm called Kennedy Associates. Moved back to my, this was after college, I moved back to Washington State to do my graduate work at University of Washington. And in doing my thesis, which was the creation of an African American museum for the Northwest, I met a man who was also helping to lead the community, who was also an architect, Black architect. He essentially adopted me. I became an intern in his practice. This was in the mid 90s. Donald King, who is a mentor and a friend. I worked for Donald and, with Donald, became a partner of his firm for the better part of 17 years, moved over into this international practice to build the civic side of the practice, this was DLR Group, a wonderful firm. Really appreciated my time there, and I essentially was recruited to join the city.

Rico: [00:04:42] I had actually been interested in the Office of Planning and Community Development when it was created. I think that was five and a half years ago. That position was taken by Sam Assefa, who is now providing leadership in this realm in California for the state. He did a great job in building the office, and I was honored to be able to be brought in. I would say that I’ve always been looking for, I’m always looking for how I can leverage whatever I’m doing today to get to something that has a larger positive impact for community, that is scalable. And so, taking my small firm community-based practice to an international firm to kind of infuse that type of community based leadership and design thinking in the international practice and then bring that same thinking to the City of Seattle now where I’m able to hopefully impact a much larger community locally. It’s very meaningful to me.

Eve: [00:06:03] So, what’s your role there?

Rico: [00:06:06] So, I am the acting director for the Office of Planning and Community Development, and it’s a multifaceted role. I mean, so on the planning side, we are in charge of our long-range planning for the city. So, Growth Management Act Coordination and compliance with the Puget Sound Regional Council. So, we have six urban growth areas, sub area plan work that we have to do. We are leaning into redevelopment of our comprehensive plan, which will be a ten-year plan. So, it will look out to 2044 and address issues of continued growth of the city, working with our Office of Economic Development regarding what is the relationship to built environment and job growth. And we also are leaning into a discussion around equity. So, how do we look at a terrible history of redlining in our city, which is no different than what we saw in cities across the nation? And how do we really begin to reverse some of that damage and help lay the groundwork to build generational wealth for our communities of color who have been under served and under supported? I would say a couple of other things are office convenes a capital subcabinet. So, I’m a member of the cabinet for the mayor and we convene on a monthly basis a cross collaborative discussion with ten capital departments across the city, including our Seattle City Light and our public utilities and our department of transportation.

Rico: [00:08:03] To look at how are we making place-based decisions related to how we’re investing dollars and kind of to try to push beyond the silos of kind of each department’s individual capital program. And then lastly, we, I also help lead our Equitable Development Initiative, which is a, it’s our largest investment in the community development side of the work. So long range planning, the stuff that’s up to 20 years out. It’s really hard for people to, people that are living their daily lives. Like, what does that work really mean to me? The community development side, we’re working on the ground in the trenches with our actual development initiative, investing around $20 million a year into community led projects. It is BIPOC-led projects, community based, multifaceted, many different types of projects, some housing related, all invest in different types of services being provided to community. It’s very inspirational and it really connects the dots between kind of our aspirational long-term goals and like work that we do in the day to day that’s actually making a difference in people’s lives.

Eve: [00:09:34] So one of the questions I was going to ask you, which I think you answered, is, does this work feed your soul a little better than the private practice?

Rico: [00:09:42] Yes, absolutely.

Eve: [00:09:43] Sounds like it does.

Rico: [00:09:44] Yeah, I would say that I feel very fortunate. I think that, from the beginning, really, as an intern, it was important to me to be able to do work in the community and to do work that had meaning and value. Whenever I have the chance to be on a panel discussion or speak with students at a university. My message has been that you really can’t wait for a tomorrow that you’re never going to get to. And, if there is something about which you’re passionate or that brings you a sense of purpose or meaning, it is important to try to lean into that, like in real time, like in your day to day. And it doesn’t mean that you can have that meaningful value in your work every single day, necessarily. I mean, there are certainly days where the work is just hard and difficult, but this job does get me out of bed every day.

Eve: [00:10:46] I completely agree with you. So, you know, I think architects are in a unique position that they really do need to think in advance, like 10, 20 years. And so we sort of trained to think about what a piece of land can become 20 years from now. So it’s sort of a very natural shift to add a little bit more to it, right?

Rico: [00:11:09] Yes, absolutely. I think that my thesis, in graduate school was. My thesis chair, George Rolfe, was an urban planner and provided leadership for our school, for the department. Actually, he was also the first ed for the Pike Place Market, which I was chair for three or four years. I was on the board for seven years. But the thesis. At the end of the day, was around development of a large city block and turning it into housing. And this African American museum, which we actually had the good fortune of being able to work with Donald King to see that project into reality with the city and the community, I think it was a decade after the thesis was completed. But as a student, what was foundational for me was that the project, while important, started with a analysis of the neighborhood and the city and context. I think that it is critical that as we make investments in individual site solutions as architects, or as individuals or as a city like it, it is critical to think about what’s the ripple effect of that individual site outward into community, into a urban context, or depending on where you live, a rural context as well. It’s more than just what happens on that single site.

Eve: [00:12:53] Yes. So, you know, this brings me to the architecture profession and an architect role. And is the profession of architecture and planning becoming more focused on equity or does it have a long way to go? How can we impact, how can we make that profession sort of reflect on this more? I suppose I’m coming from this. I also taught in an architecture school, and I found it to be startling how little students were told what they could do with this knowledge they were learning. I think architects are sort of uniquely trained and have the capability to do all sorts of things with that training, you know. But it feels to me like architecture. You know, the iconic building architecture has got to shift a little, right?

Rico: [00:13:44] I think it is. I mean, I think that 150 years ago, if this was a very white male led profession and, in some regards, that is still the case. But it was a profession that was of privilege. Again, still is, but one where the focus was on more of a elite clientele that could afford to bring on board an architect and do expensive developments that were focused on the individual. I think that what we have seen is the beginnings of a shift where we really are. Architects are servants to the community. I was recognized by the American Institute of Architects as a citizen architect in 2011 and again in 2020. And I think that part of what the Institute of Architecture has acknowledged is the importance and value of what the profession can and should be doing to help lift up diverse voices, invest in social change through built environment projects, and understand that to get to a place that is about equity in the community is a multifaceted discussion.

Rico: [00:15:18] And I often talk about Kaiser Family Foundation social determinants of health, which there are six buckets of consideration regarding if looking at the whole health of an individual or family or community, you have to address all six of those buckets. One of them is social and cultural context. One of them is built environment, food, health, health care, access to good education. And so, I think that we hold one of those pillars as architects. And I do think in 2020, with the horrible atrocity of George Floyd’s death and kind of the elevation of the critical issues around how people of color have been disrespected and held down for centuries. You saw a lot of architects actually asking the question, what can we do to be a value to make a difference in this discussion? And I think that we are now doubling down on trying to answer that question. I think it is about being an ally. I think it is about being a support. I think it is about transfer of wealth from those that have to those that do not, and that can be done through environmental projects.

Eve: [00:16:59] When you think about a space or a place that’s being designed, what elements do you think are critical for it to become more equitable.

Rico: [00:17:10] This can be hard depending on the project type. I think that looking at the context of a place. I mean, you have to start with what is the history of that place, right? Like, who did the land belong to? We in our, in these United States have stolen land from our Indigenous population. And that is a burden that we need to carry forward in the work and looking toward righting past wrongs. I think that looking at a context of place, you have to look at the generational history of that place, how that informs site and context. And then what is the community, the resident community that is there in the present and how might they be affected by whatever the built environment project is that is being proposed? And what is the opportunity for that resident community to be invited into the conversation and the process for visioning for the redevelopment of a site. I think depending on what the type of project is, will determine on what the community role is or can be in that project. But I think that it is critical for us as architects to ensure that the community does have a seat at the table.

Eve: [00:18:50] Interesting. Yeah. I mean, I was at the planning department many years ago, and community engagement really meant just some meetings with the community many years ago. I mean, how has that shifted? What does that really mean today? Like community engagement?

Rico: [00:19:05] It is a dangerous prospect. It’s very easy to get trapped in a box checking process where, you know, City of Seattle, we have a regulatory process which requires that for many projects you have to go through design review in order to get your building permit, and that requires that you have two community meetings. So, you go out and talk about height, bulk and scale of the project and then come back for a second meeting and talk about how facades will be articulated. And it’s easy to, I shouldn’t say easy, but it is not unusual for that process to look or function performatively but not actually engage the community in the real conversation about things that they care about. I think that that latter conversation is hard.

Eve: [00:20:03] It’s very hard. Yeah.

Rico: [00:20:05] It is.

Eve: [00:20:06] Very hard.

Rico: [00:20:07] When I was the chair for the Pike Place Market, PDA Council, Preservation Development Authority, honestly, we had public open meetings every single week with a very engaged resident population. Between over 300 businesses, mostly small businesses and residents that live on that urban campus, if you will. A lot of people very much cared about their built environment and their families and businesses and would show up to those meetings to hold us accountable for decisions that we made, many of which were about the buildings that we owned and the public realm environment that we were responsible for. And it is much easier to make decisions about what a building looks like and how it impacts the environment when you are doing the design, executing the project and then walking away, it’s much harder to do that when you’re going to be held accountable week to week long after that project is completed.

Rico: [00:21:23] That is certainly an attitude that Donald and I shared in private practice with our small Black-owned firm that, not only around the idea of repeat clients, but just around community accountability. You have to do well by community through the process. Community has to see themselves as a part of the conversation and not, in a tangible way. There’s a project that I worked on where the part of the call and response with Community got to a place where we really had to have a very explicit conversation about, this is what we hear you saying that you need. This is what we can do. And this is how that input is being incorporated in build form in the project. And this is what we can’t do, and this is why we can’t do it. I think so often we’re afraid to be honest or transparent about what we can and what we can’t do and what the whys are, because then we can be criticized or someone might not agree with us, but the reality is that is the only way.

Eve: [00:22:34] Yes.

Rico: [00:22:35] By having an honest and transparent and real conversation with people, can we build trust and actually do well for ourselves and on behalf of community?

Eve: [00:22:48] The question I always have is this is a very high resource, intense activity. And for the thousands of little projects going on with small developers who don’t have the capability to have that sort of continued conversation, I wish that there was someone building resources for them because I think often that community activity can be perfunctory when you simply don’t have the ability to manage it, right. I mean, if you’re a big developer and you set aside a bucket of funds and time and you can plan for someone to be managing that, you can get it done. But if it’s something small, which could matter equally. Equally, right? It’s difficult.

Rico: [00:23:43] Yeah. I appreciate your point. And I do think that for smaller developers, it is important to be able to provide a small development community. And I have been in conversations with an organization called LISC.

Eve: [00:24:01] Oh yes, I know LISC.

Rico: [00:24:02] That does investments, large investments in the community nationally. Locally, they are engaging in a program to invest in small bipoc developers, figure out where they are in the development of their practices, and then how they can help provide them resource to grow their capacity. Like I said before that level of community investment that is meaningful is hard. But I think that if authentic, then it becomes more straightforward. And what I mean by that is, it is very difficult for a developer to come in from outside the community, into a place, propose a project without having community context or contacts. And I think that, while I understand that if you’re a small developer, you have limited resource, I still think that from a place of responsibility, that part of that resource has to be allocated to talking to people in the neighborhood. Talking about your project. Understanding what the context and impact of it is. And having that inform the design and implementation, including hiring of small business, other small businesses that are part of the construction project or become residents in the project, I think that the activity is scalable. I understand that smaller projects have more limited resources and therefore can’t do the same things that large projects can. But I also know that small developers often find themselves more connected with community in their projects than large corporate ones. I don’t think it’s simply an issue of scale.

Eve: [00:25:55] Yeah, no, I see that. So, I suppose I want to know how can we actively make places that work for everyone and that everyone feels comfortable in? I understand the history and the engagement, but how does that translate physically? Like, have you got an example of a project where you think it might have turned out very differently if there hadn’t been that engagement?

Rico: [00:26:22] I’ll talk about this project that’s opening up now called Midtown Square. It is a project that was built by Lake Union Partners here in Seattle. I was brought in to lead a community conversation because there was a fissure between what the white majority developer was looking to do, building of 430 units, and what the community saw, which was a white developer coming in and taking over what was a very important site to that community at Union and 23rd in the Central District, which was a historically Black neighborhood in the city.

Eve: [00:27:02] You don’t choose easy conversations, do you?

Rico: [00:27:04] No. No, I don’t. Through a community engagement process, so there were, we created a series of open houses, one on one interviews, small group discussions, meeting people where they’re at, going to the local school public events to talk about the project really sought to get community input and direction. What we built was an art program for the project where we brought in eight locally connected BIPOC artists that transformed both site and building, like the facades of the building, actually were turned into canvases for artists to transform. And what we ended up with is a destination location at that at that intersection now where in addition to the art program, we created a new non-for-profit at the prominent city corner, which is dedicated to the artist community, largely Black artists. There’s a place for artists to sell their wares. There is an artist residency location, there’s a gallery. None of which was conceived of in the original project. And the ground floor of that building, both the interior courtyard and the two prominent facades that face major street fronts, will be filled with Black-owned businesses. And so, the transformation of the public realm is both bringing back businesses that were pushed out of that portion of the neighborhood and also creating opportunities for new business or expanded business that’s contributing back to the generational wealth of the owners of those businesses.

Eve: [00:29:08] That’s a remarkable outcome. And it’s a very, very lovely one. I can picture it. And was the developer happy with this outcome?

Rico: [00:29:19] Very much so. And I have to say that I feel like we were very fortunate to. And, you know, transformation happens over time, right. They had done two other projects in the neighborhood that had no investment in a community conversation, at least not one that that was evident or one that was felt and understood by the community being impacted to see the, this developer lean into a different process. And to be clear, like it began because the City of Seattle, through the regulatory process, said, yes, we understand what you are trying to do, but the community is not aligned with you on this project and you’re going to have to go fix it, figure it out.

Eve: [00:30:08] That’s a great role.

Rico: [00:30:10] It was an important role. I think that we were very fortunate to be able to work with a developer who could respond to a different viewpoint and different ideas than what they may have initially visualized, or the extent to which the level of investment that was asked of them was very different than where they were, where the project conversation started

Eve: [00:30:39] I don’t know how they could have imagined that outcome. It’s pretty terrific. I do want to say, like just on our funding portal, what’s been a really interesting shift that we’ve noticed over the last year or two, again since the horrible George Floyd episode, larger and larger developers have been coming to us in an effort to kind of integrate raising capital from the community or letting the community have some ownership in their project as well, it’s been a really pronounced shift. So, I think all of this is kind of happening together. It’s fascinating and fabulous.

Rico: [00:31:18] And even on that project. And so, we, now that I’m on the city side, I get to see it from the other side of the table, like the new not-for-profit applied to the city for funding for their tenant improvement. The ones dedicated to artists on the ground floor, that, there was a push. Like, that was not what the original intention was for that corner actually was going to be a CVS pharmacy.

Eve: [00:31:48] Oh, I like this much better.

Rico: [00:31:52] Yes, everybody did, developer included. But the big push there was a condominiumization of the building where that ground floor unit is now owned by the not-for-profit and providing generational wealth to artists that will be involved with that collective, which was again not what was originally, it was not what was originally conceived by the developer. And so, there is a big push that we are making. At least in this work that we’re doing through the EDI program, to ensure that moneys that are being invested, the properties are held by community members, by BIPOC owners that actually helps them get to a better financial position.

Eve: [00:32:47] We just completed an offering actually for the San Francisco Community Land Trust, which was really interesting because they purchased a 41 unit building with some retail space that was a commercial rental building, and they are going to be converting it over the next few years into a BIPOC owned cooperative for the people who live there. Very complicated project, but we actually help them raise money. Although they didn’t need the money for their business plan, they wanted to let the community invest, and there are so many people out there who want to help. It was very interesting. The return offered was low, but that doesn’t matter to some people. Yeah, we’re hoping that we’re going to raise. I mean, that was probably one of the best do-good projects we’ve ever done. I thought it was a pretty amazing project. So, I think more and more this is happening, which is just in all sorts of ways, which is just fabulous. So, I wanted to talk to you about the Waterfront Seattle Park as well, but we may have run out of time because that’s a huge project that looks amazing. And I know you were involved. And how did that impact the outcome of what’s being built, I suppose?

Rico: [00:34:03] I was recruited to join the Pike Place Market Council in large part because a parcel Pike Place had one remaining parcel on our campus which was able to be developed, and it was essentially an early win for the Waterfront project, which is headed up here by Marshall Foster, Office of Waterfronts and Civic Projects. That opportunity was to develop a site that contributes to the Pike Place Market in creating a huge plaza that allows you to look out over the waterfront and the city, and that’s a public gathering space. Added farmer and market stalls that became an extension of marketplace for us, but, well and created 10,000 square feet of makerspace for businesses. But underneath all of that, and that’s what’s important for the Waterfront project, we built 300 parking spaces which were part of a replacement. There was a study done as part of the Environmental Impact Statement for the Waterfront Project that acknowledged that I believe over 600 spaces were being lost in the redevelopment of the waterfront and that that was a critical impact to the downtown community. And so, Pike Place Market essentially answered an RFP from the city for a replacement of a portion of those parking spaces. So below the project, invisible to anybody that comes into the market, we have provided a solution to a need for the Waterfront development. It’s not what drives the placemaking, but important for the functioning of the downtown.

Rico: [00:36:11] On the placemaking side, the Marketfront Project, that’s what we call it, it was the first development, and I would call it a public private partnership, right? Because half of the 34 million was committed into that project by the city, the rest of it was committed and developed through funding from our Pike Place Market foundation. And we actually, the PDA did a large bond funding to fund the project and tax credit financing. But we had this opportunity to create a public space, public gathering, that contributes back to public realm. And it is the first stage of creating a bridge from a Pike Place Market site across to a future aquarium expansion Seattle Aquarium that then takes you down to the new waterfront. Our project is great. The development, once it’s complete in entirety is going to be incredible, including the Overlook Walk, which connects from the waterfront up into the market. It has been very complicated. Many voices. A huge vision that was the waterfront bringing together the entire city to be a part of that visioning process. It’s been an honor to be able to be a part of that.

Eve: [00:37:39] Interesting. Yeah. The many voices is scary, but it sounds like you manage them very well.

Rico: [00:37:46] I do the best that I can. And, you know, I think that now being at the Office of Planning and Community Development, I have a benefit of having 44 staff that are all very invested in this vision for equity, leading with equity, and kind of doing right by community. And so, this has work. I mean, to be clear, we are the City of Seattle, as an entity is over 11,000 employees. And so, we’re a very small complement, but we are leaning into what is transformation look like for the city and how do we do this work in a way where people have voice and can be seen. And it is hard work, and it does take a village. But I feel like we are starting to make some headway.

Eve: [00:38:47] So one final question. What’s your big, hairy, audacious goal?

Rico: [00:38:54] That’s a good question. I mean, the honest reality is, is that I think that on this conversation of generational wealth, that we have a responsibility, both as a city and as a nation, to look at harms that we have caused for the Asian community, for the Black community, and for the Indigenous community and for the immigrant community and ask ourselves, how do we change policies that we have in place, built environment and otherwise economic investment to get our communities of color to the place that they deserve to be? And what does that mean? That does mean investing and curating a authentic discussion in each of those communities to ask what that means, of the communities that we are engaged with. And then we have a responsibility to act to support those needs. That is not an easy thing to do, but it is a responsibility that we have. And it’s something that I have been committed to since I started. I got into architecture because I saw how much built environment affected people, myself included, and how you could get to transformational social change through built environment projects. That is one piece of the puzzle. But the reality is, is that we have a lot of work to do to get us all to a better place. And I am really excited about it. It is hard work, but it’s what gets me out of bed every morning.

Eve: [00:40:46] Well, I’ve really enjoyed this conversation. And honestly, if every single large development ends up with an outcome like the non-profit on the corner, that would make change pretty rapidly. That would be a fantastic thing to see. So, thank you very much for your work. I really enjoyed this.

Rico: [00:41:04] Thank you.

Eve: [00:41:09] Listening to Rico talk about just one project was inspirational. If one developer can move plans for a retail space from a CVS to a community-owned arts building, then just imagine what an army of them can do.

Eve: [00:41:32] You can find out more about this episode or others you might have missed on the show notes page at our website RethinkRealEstateForGood.co. There’s lots to listen to there. A special thanks to David Allardice for his excellent editing of this podcast and original music, and 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 by M Nakamura courtesy of Rico Quirindongo