Building Detroit: Black Developers Are Key To Detroit’s Comeback

(From Left To Right: Sonya Mays, Roderick Hardamon, Kenyetta Hairston-Bridges. Photo credit: Moon Reflection Photography)

It is almost impossible to drive on any main street in Detroit or through any neighborhood without seeing development or redevelopment projects, either in its early stages, nearly finished or recently completed.  Unbeknownst to the average person, many of the projects – rehabilitation, new construction, mixed-use or single/multifamily housing developments – are being spearheaded by Black developers.

One such developer is Dennis Archer Jr., who is leading a development team to build a             small-format Meijer store which will be located at 1475 E. Jefferson, near downtown Detroit.  When completed later this year, the 42,000-square-foot store will be called Rivertown Market.

Archer is also leading a development project in the new Paradise Valley Cultural and Entertainment District in downtown Detroit.  From the 1920s through the 1950s, the District was home to numerous African American owned businesses and entertainment venues.

“There are two buildings that we acquired in January of last year on Randolph St.,” said Archer, who points to this spring for development activities to begin.  “The buildings will be redeveloped into mixed-use, where there will be space for offices and hospitality usage.”

Another noted Black developer is Emmett S. Moten Jr., founder, president and CEO of The Moten Group LLC.  Once called Mayor Coleman A. Young’s “economic guru” and “development czar” in the 1970s into the late 1980s, Moten has moved exponentially into the private sector of development.  In 2007, he engineered the $82 million development deal that renovated the abandoned downtown Fort Shelby Hotel into a Double Tree Suites by Hilton featuring 203 guest suites and 56 apartments.

While Moten doesn’t like to speak about his ongoing or future projects, he did talk about the current renovation of the downtown historic United Artists Building.  When completed in late 2021 or early 2022, the $56 million project, said Moten, will feature 148 apartments, 20 percent of which are designated “affordable.”

According to Moten, project partners are Roy Roberts, Tom Goss, Jim Thrower, Larry Brinker, Robert Charles and Richard Holsey.  The late O’Neil Swanson was also a partner.

“We all have equal ownership,” said Moten.  “And we all have the same idea to do something constructive in the community and hire our people.”

Doing something constructive to make communities better in an overwhelmingly African American city is paramount for many local Black developers.  Yet, in many cases their paths to pursue development and redevelopment projects in Detroit are far more difficult than those of white developers.  What Black developers find, for the most part, are challenges unique to them, which include, but are limited to the lack of access to capital and difficulties in acquiring land.

As for access to capital, Marvin Beatty, civic leader and developer of Gateway Marketplace, which when opened in 2013 was the city’s first major retail center built in four decades, had an interesting perspective about banks and Black developers that he shared in a 2017 interview with The Michigan Chronicle.

“If banks and institutions don’t loosen the way they do business with us, the way they do business with others, we’ll continue to struggle in our communities to see ourselves develop,” Beatty said. “We have the skills and the intellect to do exactly the kind of thing that Dan Gilbert is doing.  But if we don’t have the same access, we will not have the same opportunity.”

Sonya Mays, president & CEO of Develop Detroit Inc., agrees.

“For banks, there’s a long history of Black people being seen as high risk for financial opportunities that would provide capital for Black developers,” Mays said.  “It leaves many Black developers in a place where we have to bootstrap it or not do the project at all.  We really do need to rethink, as a community, about equity impairment and how Black people can better access capital to do this work as developers.  And lending institutions need to reexamine the disparities and rethink their business models regarding Black developers.”

Mays said America is littered with examples of programs that offset risks, shift risks or mitigate risks for the pursuit of a greater social good.

Archer agrees that not having access to capital presents major problems for African American developers – emerging and established.  He adds that African American real estate developers also face the lack of access to information, deal flow and input into influencing policies that impact development in Detroit.

Helping to level the playing field for local Black developers is Detroit Economic Growth Corporation (DEGC), a private, non-profit entity devoted to supporting Detroit’s economic development initiatives.  Rendering leadership to many Black developers and their projects is Kenyetta Hairston-Bridges, DEGC’s executive vice president of Real Estate and Investment Services.

In her executive role, Hairston-Bridges and her Real Estate Development team, represent the city of Detroit’s one-stop shop for economic development.  Hairston-Bridges says her team, on behalf of the city of Detroit, assists Black developers in areas such as construction management, negotiations, financing, land assembly, real estate and incentives qualification and application. Much of the team’s success comes from partnerships with external organizations like Detroit Regional Partnership, Michigan Economic Development Corporation, Detroit Invest and other stake holding entities.

“Some developers come and talk with us about what they want to do.  A dream is fine; we can start to entertain it, but there has to be more of a plan,” said Hairston-Bridges.  “When a Black developer, or any developer for that matter, comes to us, we are going to help execute on their vision or their plan, but we need to have something as a baseline to begin helping them.”

On the receiving end of such help are Black developers George N’Namdi and Roderick Hardamon of The N’Namdi Holdings and URGE Development companies.  Last October, N’Namdi and Hardamon broke ground on the future Osi Art Apartments at West End, located on Grand River, just west of Trumbull.

The colorful complex will consist of 30 apartments, half of which will be designated as affordable housing.  As part of the West End Gallery District, the complex will have retail space, restaurants and galleries.

“We are doing development projects that make a statement,” said N’Namdi.  “We want to do something that people will say – Wow!”

The Osi Art project was the first development launched under the new Detroit Housing for the Future Fund, which was unveiled last September.  The fund, with the City of Detroit as a collaborator, is comprised of private investments for affordable housing development and preservation projects in the city.

Hairston-Bridges said when deemed ideal, DEGC seeks to match Black developers and white developers together on projects.

“We look for opportunities to partner Black developers with larger, majority developers,” said Hairston-Bridges.  “A classic example is the partnership development project which connects Queen Lillian with The Platform to develop a $60 million mixed-use project.”

When completed in the summer of 2022, the project will boast 204 apartments and almost 25,000 square feet of retail space.  Queen Lillian is a Black-owned development company based in Detroit.  Christopher Jackson is co-principal and managing partner.  The Platform is a private, white-owned development company in Detroit, where Peter D. Cummings is executive chairman and CEO.

Black developers shaping the renovation and new construction landscape of Detroit is of utmost importance to Detroit Mayor Mike Duggan.

“We are experiencing a period of development in this town we haven’t seen in generations, and the highest priority of my administration is to make sure that Detroit’s Black developers are able to take advantage of this tremendous opportunity,” said Duggan.  “As our city continues to come back, we are seeing more and more that it will be Detroiters rebuilding Detroit.”

While most Black developers in Detroit are males, there’s lots of room for Black women in the industry.  One African American woman that’s making great strides as a developer is Sonya Mays, Develop Detroit, Inc.’s top executive.

The company is currently working on two projects that Mays chose to speak on at this time:  Sugar Hill Mixed-Use Development (Garfield St. at John R) and North End Homes (along Woodward Ave. between Marston and Philadelphia Streets).

According to Mays, Sugar Hill when completed will feature 84 luxury apartment homes, 11,000 square feet of retail space, and an on-site preschool.  The North End project will feature 19 homes classified as single family and townhomes.  The $4.2 million investment calls for both constructed and rehabbed homes.

Mays said that she wants to see more Black women become developers in the city.  She said she knows of only a half-dozen African American women working as developers in Detroit.

“I’m trying to train more Black women to do this work,” said Mays.  “I have a couple of really phenomenal Black women developers on my team.  I’m always making time and space to counsel and mentor African Americans.”

“The pool for Black female developers is small,” said Hairston-Bridges.  “DEGC is taking a hard look to determine how to get more Black women into the fold.”

An organization that’s helping to train and educate Black women and Black men to excel as Black developers is Capital Impact Partners.  While headquartered in Arlington, Va., the organization has had a serious impact on development and redevelopment projects in Detroit. Since 2009, Capital Impact – through its multiple philanthropic and financing partners – has invested more than $100 million in development and redevelopment projects in Detroit communities.

One of the organization’s key objectives is to remove barriers that have hindered African American developers in Detroit from participating in the city’s revitalization experiences.  Through Capital Impact’s Equitable Development Initiative (EDI) African Americans are learning the ins and outs of local real estate development.

“We are excited to continue providing opportunities and increasing capital to ensure equitable development in the communities we serve,” Ellis Carr, president and CEO of Capital Impact, said in a statement.  “This allows us to further grow this effort and support Detroit’s minority developers who are working to stabilize communities.”

Another organization that’s helping to support Black Developers is Invest Detroit.  The 20-year-old Detroit-based organization is a mission-driven “lender, investor and partner” that supports business and real estate projects.  As part of its public-private-philanthropic partnership with the City of Detroit, Invest Detroit is currently involved in facilitating new construction and renovation development projects in strategic neighborhoods in the city.

A major way of supporting development in the neighborhoods is through the Strategic Neighborhood Fund (SNF) investments.  Invest Detroit is the fiduciary of SNF and administers and deploys the funding. Through its collaboration with the City of Detroit, 10 neighborhoods’ commercial corridors are receiving SNF, which has been allocated in two phases.

SNF’s initial investment was $42 million for projects in three neighborhoods (Southwest/Vernor, Islandview Villages and Livernois/McNichols).  SNF 2.0 has added an additional $130 million for development projects in seven neighborhoods (Northwest Grand River, Warrendale/Cody Rouge, Russell Woods/Nardin Park, Campau/Banglatown, Gratiot/7 Mile, East Warren/Cadieux and Jefferson Chalmers).

“We all know the much larger names in development, but these strategic neighborhoods are also being developed by local Detroiters, with a significant number being Black developers,” said Keona Cowan, executive vice president of lending, Invest Detroit.  “Because we are the type of lender that creates an environment that other lenders aren’t able to create, a number of Black developers come to us as a lender for their real estate development projects.”

Cowan said Invest Detroit is supportive of emerging Black developers who are entering the development arena through training programs.  Building Community Value, a nonprofit organization headquartered in Detroit, offers a program that’s preparing Black developers to take on real estate development projects in underserved Detroit neighborhoods.

“We are very supportive of Building Community Value programs and Capital Impact’s Equitable Development Initiative,” Cowan said. “Those are two programs of opportunities for aspiring real estate developers to gain real knowledge of how development works, and in the case of Capital Impact’s EDI program, its development training is geared towards minorities and minorities only.”

Cowan said Invest Detroit is so impressed with Capital Impact’s EDI initiative that Invest Detroit has selected two developers from the program to be developers on the SNF’s Livernois/McNichols projects.

While it’s important to help today’s Black developers in every aspect of development, both Cowan and Mays believe there’s great value in preparing the next generation of Black developers.

“I would like to see more real estate developing programs offered to high school students who may not want to go to college,” Cowan said.

Mays, who is a Detroit Public Schools board member, agrees.

“I think the more we can put real estate development on the list of careers for our young people to explore,” said Mays, “the better the pipeline can be for building future Black developers in our city.”

 

 

 

 

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