Haitian-born Julio Bateau arrived in Detroit in 1978 with a graduate degree in structural engineering and a spirit of possibility. He was drawn to Midtown, a then-economically distressed area in central Detroit overrun with vacant and abandoned properties. Bateau saw an opportunity. “My vision was not to make a lot of money or build an empire. The goal was stability in the neighborhood,” explains Bateau. “I have always been focused on the long run.”

For Bateau, founder of Nailah LLC, the “long run” has meant a decades-long career as a community-minded, for-profit developer. His firm’s portfolio includes Midtown redevelopment projects such as the Espoir Center for Caribbean Arts & Culture and Nailah Commons, a 58-unit rental townhouse complex that is a mix of affordable and market-rate housing. His firm has also restored historic homes on Detroit’s East Ferry Street.

Yet over the past 30 years, even with an experienced team and “strong balance sheet,” Bateau has faced obstacles to securing capital. “Despite the relative financial success of my projects, I’ve never successfully gotten a loan from a large, commercial bank,” he says. “I don’t want to be labeled ‘Black’—I just want a fair chance.”

Bateau’s difficulties are not surprising when viewed through the lens of the Black American experience in real estate and construction. For decades, advocates have pointed to discriminatory patterns in the banking sector that perpetuate barriers to capital access, asset-based wealth generation, and economic mobility for people of color. Many have called for more inclusive approaches to community banking and neighborhood investment backed by strategies capable of narrowing, if not closing, America’s racial wealth gap.

In the wake of national protests against anti-Black racism and police brutality in 2020, many CDFIs reevaluated how closely their operations and investments align with racial equity objectives. The economic fallout from the pandemic, which has disproportionately hurt minority-owned businesses and once again highlighted the lack of affordable housing in many cities, heightened the urgency to make capital more accessible to BIPOC developers.

The real estate sector has a history of exclusionary employment practices and underrepresentation of Black and Brown professionals. And the racial wealth gap itself has reinforced that underrepresentation. “Traditionally, real estate development has relied on family money,” explains George Ashton, managing director of strategic investments for the Local Initiatives Support Corporation (LISC). Many Black and Brown Americans lack access to the “network-based wealth” that underpins development, Ashton says, and so “[as a CDFI], we step into that void.”

Read the full article about supporting BIPOC developers by Nisha Mistry at LISC.