Giving Compass' Take:
- Miriam Axel-Lute shares how Enterprise and LISC are centering racial equity in capital-building projects.
- What role can you play in supporting racial-equity-centered community development?
- Read about gender-lens investing to support BIPOC women entrepreneurs.
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When Leonard Adams started his journey to build Quest Communities, a nonprofit developer of transitional and permanent supportive housing in Atlanta, he had no connections to the world of community development. He just knew that he wanted to use the properties he owned “for something a little bit better than just being Mr. Landlord,” he says. There was a clear need for housing for people who were trying to exit homelessness and were waiting for open spots in various treatment programs, as well as for those graduating from those very programs, and that’s where Adams started. Quest became a nonprofit in 2001 after a few years on the for-profit side.
Over the last two decades Quest has served about 10,000 households. In 2019 alone it had $38 million worth of construction under way. And still, Adams says when he approaches some lenders, he is still made to jump through hoops that don’t match with his experience. For example, he’s been asked for personal guarantees in recent memory, which isn’t appropriate given his organization’s track record.
Adams is a Black man, and he benefited somewhat from Atlanta being a region with a number of other Black developers, more than in most parts of the country. Although those developers weren’t trying to house the population he was trying to house, Adams still found it difficult to convince traditional lenders to take him seriously. After Quest became a nonprofit, Adams made connections to community development lenders and built a thriving organization, but he did so despite multiple instances of discrimination from lenders, repeatedly needing to prove himself despite his organization’s track record, and steep learning curves as he discovered things he didn’t know his staff needed to know, such as Low Income Housing Tax Credit compliance details.
When Adams first connected to his local office of Enterprise Community Partners, a national community development intermediary, over a decade ago, it was a great relief to find a lender that understood his mission. “There wasn’t a bank in town that was gung-ho about what I was pitching,” he recalls, but Enterprise “immediately understood what we were about. I didn’t have to prove to them why [my mission] was important, we just had to figure out how to make the numbers work.” He has worked with the group ever since, availing himself of all the programs it offers, from lending to leadership training.
But he also noticed that many of those programs were overwhelmingly white—both in speakers and participating developers. And he noticed that the terms on the loans he was getting weren’t much better than those being offered by traditional banks. These are the kinds of things that Enterprise—and its counterpart LISC—are hoping to change with their recently announced racial equity initiatives.
Read the full article about building capital in communities of color by Miriam Axel-Lute at Shelterforce.