19 Nov, 2019, 05:30 ET
WASHINGTON and ARLINGTON, Va., Nov. 19, 2019 /PRNewswire/ -- While the local real estate market is booming across the Washington Metropolitan area, developers of color are severely underrepresented in a market dominated by large global and national firms. In an effort to reverse this alarming trend, Capital Impact Partners announced the expansion of its Equitable Development Initiative (EDI) into the D.C. area to help local minority real estate developers who represent the region's diversity take a leadership role in shaping the development landscape within the local context. The program's first cohort will provide 35 new minority developers with training, mentorship and networks, and pathways to access the capital necessary to grow their businesses.
This initiative is modeled after the successful program that Capital Impact launched in Detroit in 2017, which is now taking applications for a third group of participants. EDI provides a combination of formalized training, mentorship with local experts, and access to real estate networks to bolster inclusivity within Washington, D.C.'s real estate market.
Tailored to the needs of local communities where rising costs and displacement are increasing, the two-year program is designed to kick start the development and preservation of multifamily, affordable housing options across the D.C. region. Participants will receive broad-based training, including project budgeting, real estate finance, project and contractor management, legal services and community engagement.
"Across the D.C. Metro area, historically African-American communities are being squeezed out of the region by development that does not prioritize inclusive and equitable growth. One reason for this is the lack of developers of color who understand the city and who are best positioned to meet the needs of these communities," said Ellis Carr, president and CEO of Capital Impact. "Like so many other issues facing communities of color, the root causes of this include systemic efforts to prevent these developers from accessing capital, training, and networks. As we are doing in Detroit, our EDI program will begin to address these important issues here in D.C., Virginia, and Maryland."
Capital Impact, with investments from the A. James & Alice B. Clark Foundation and JPMorgan Chase, will engage a variety of local partner organizations, including the Housing Association for Non-Profit Developers (HAND), Washington Area Community Investment Fund (Wacif), and local mentors to support the initiative.
"The largest contributing factor to the racial wealth gap in the country to date is the fact that people of color have not had the opportunity over time to own and profit from real estate," said John Green, co-founder, Blackstar Real Estate Partners and an EDI mentor. "So, the Equitable Development Initiative is extraordinarily important because it addresses the epicenter of one of the most important problems of our time."
"Capital Impact Partners' Equitable Development Initiative is an excellent example of how HAND members are creating communities where all can participate and reach their full potential. We're excited to welcome the cohort into our collective of over 400 changemakers, which will provide access to educational opportunities designed to build capacity and foster critical connections that support the growth trajectories of minority real estate developers," said Heather Raspberry, executive director, HAND.
Capital Impact considered 120 applications for its first Washington, D.C. cohort, which were selected based on the following eligibility guidelines:
- Identify as racial or ethnic minorities;
- Be actively working to further careers in real estate development with some real estate development experience;
- Live in or near the primary metropolitan area of the program, and have a strong connection to the city in which they are working;
- Demonstrate a commitment to their city's revitalization; and
- Be interested in responding to requests for proposals for real estate development opportunities with or without a development partner in the next 1-2 years.
"Through my experience in the Detroit EDI, where I was one of 19 developers chosen to participate in the program, I was given the opportunity to deepen and expand my knowledge into real estate development and project management," said Sherita Smith, EDI Detroit participant and executive director of Grandmont Rosedale. "I am currently working on my first-ever mixed-use, mixed-income project, and this program has helped me navigate the development through engaging a co-developer and partner who can mentor me and serve as a resource through the process."
According to a study by the National Community Reinvestment Coalition, about 40 percent of the District's lower-income neighborhoods experienced gentrification between 2000 and 2013, giving the city the greatest "intensity of gentrification" of any in the country. The District also saw the most African-American residents — more than 20,000 — displaced from their neighborhoods during that time, mostly by affluent, white newcomers, researchers said.
In addition to its EDI program, Capital Impact is also working to reverse this trend by serving as the manager of the D.C. Affordable Housing Preservation Fund (AHPF), initiated by Mayor Muriel Bowser. To date, financing to projects through the fund have helped preserve more than 1,000 affordable homes in D.C.
One example includes 1101 Euclid, which was originally constructed in the 1900s. Over the past several years, the neighborhood has experienced a rapid loss in affordable housing, and the building has fallen into disrepair. Through AHPF, Capital Impact provided a $3.2 million loan, helping the tenants work with a black-owned developer to acquire their building and make critical repairs while maintaining affordability for up to 78 residents.
About Capital Impact Partners
Through capital and commitment, Capital Impact Partners helps people build communities of opportunity that break barriers to success. We deliver strategic financing, incubate new social programs, and provide capacity building to help ensure that low-to-moderate-income individuals have access to quality health care and education, healthy foods, affordable housing, and the ability to age with dignity. A nonprofit Community Development Financial Institution, Capital Impact Partners has disbursed more than $2.7 billion to revitalize communities over the past 35 years. Our leadership in delivering financial and social impact has resulted in Capital Impact earning an "A+" rating from S&P Global and being recognized by Aeris since 2005 for our performance. Headquartered in Arlington, VA, Capital Impact Partners operates nationally, with local offices in Detroit, MI, New York, NY, and Oakland, CA. Learn more at www.capitalimpact.org.
SOURCE Capital Impact Partners
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