Amid the Dallas region’s booming real estate market, we need to do better for both developers of color as well as communities of color.
A new program aims to help both.
The Equitable Development Initiative (EDI), led by Capital Impact Partners, is breaking down barriers for real estate developers of color – and, in turn, creating more affordable housing. The developers will receive broad-based training – in areas such as project budgeting, real estate finance, project and contractor management, legal services and community engagement – as well as local mentorship, network building, and pathways for them to access funding.
EDI has already led to success stories in three major metropolitan areas across the U.S., training nearly 200 developers of color since 2018. The Dallas region will become the fourth.
Systemic Barriers and Racism
The real estate industry has long been dominated by large national and global firms. Developers of color, meanwhile, face significant barriers to entering the real estate space. They lack access to capital, equity and experience – the result of generations of structural racism and disinvestment.
At the same time, communities of color in Dallas are suffering, pushed farther out of the city due to rapidly rising home costs, a lack of housing inventory, and gentrification. Dallas currently has a 20,000-unit shortage of affordable homes.
“Systemic barriers have prevented developers of color from achieving their potential in helping communities across the country,” said Ellis
Carr, president and CEO of Capital Impact Partners and CDC Small Business Finance. “As we are doing in Detroit, the Washington metro area, and the San Francisco Bay Area, our EDI program will begin to build a more equitable real estate development ecosystem here in Dallas.”
The Equitable Development Initiative will prepare emerging developers of color to pursue affordable housing projects and play a larger role in shaping Dallas’ development landscape.
“This is all about creating a more inclusive economy in Dallas. When we think about closing the gap in financing available to developers of color, this is a huge opportunity. There is an incredible need for new and affordable housing across the country, and we’re glad to partner with Capital Impact Partners to support our local developers of color who are working to address this issue in their communities.” – Michelle Thomas, Executive Director and Head of Philanthropy for JPMorgan Chase in Dallas/Fort Worth.
JPMorgan Chase & Co. provided $500,000 in grant funding for the Equitable Development Initiative’s expansion into Dallas. Capital Impact also received a grant from Charles Schwab Bank in support of the Dallas EDI expansion.
Capital Impact, a nonprofit Community Development Financial Institution, has disbursed more than $2.5 billion since 1982. Capital Impact Partners and CDC Small Business Finance have joined together to reinvent traditional and mainstream financial systems – ensuring those systems equitably serve communities of color to drive community-led solutions that support economic mobility and wealth creation.
The expansion of EDI into the Dallas area is reflective of Capital Impact’s growing investments across Texas. The Lone Star State presents enormous opportunities for community and economic development through investment in historically underserved, underfinanced communities of color. To date, Capital Impact has invested more than $88 million in Texas in affordable housing, education and more.
The First Cohort and How to Apply
The first EDI cohort in Dallas will provide approximately 20 emerging real estate developers of color with assistance to help them grow their businesses. Learn more about the Equitable Development Initiative at capitalimpact.org/edi. The application window runs from April 7-May 6, 2022.
Capital Impact will select participants based on the following 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/region in which they are working
- Demonstrate a commitment to their city/region’s revitalization
- 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
Spotlight: EDI Success Story
The Equitable Development Initiative is modeled after the successful program that Capital Impact launched in Detroit in 2018. It expanded into the Washington metropolitan area in 2019 and into the San Francisco Bay Area in 2021. Many of the participants have since gone on to create their own organizations, build local developments, and foster peer-to-peer networks.
Following graduation from the 2019 Washington D.C. EDI cohort, Thomas Houston and Talayah Jackson acquired a lot and began development of a 17,000-square-foot building in D.C.’s Ward 7 that will provide affordable housing, retail, and office space in a historically Black, economically disadvantaged neighborhood.
With nearly $1 million in financing secured through Capital Impact’s Diversity in Development – DMV Loan Fund, Thomas and Talayah’s nonprofit community development corporation, Medici Road, is developing condo units that will be sold at prices affordable to D.C. residents earning 80 percent of the median family income. The ground floor of the building will include a full-scale grocery store that will simultaneously address the community’s food access issues and employ local residents.
“It is extremely important for programs like Capital Impact’s Equitable Development Initiative to exist,” said Houston. “Are there universities that offer similar courses? Absolutely. But you go back to barriers, like who can afford a $10,000 certificate course? When you look at networks and how we grew up, I didn’t know any developers. I didn’t know anybody who had a $20 million, 10-unit portfolio. And so there [was ]nobody to teach me about development.”
*This article is brought to you by JP Morgan Chase Bank