Sean Pichon of PGN Architects and Omar Karim of Banneker Ventures | 2220 MLK Avenue in Washington, D.C. | So, There is a Housing Crisis
Transcript
Announcer 0:02
Welcome to American Building, a weekly recorded show whose mission is to share an alternative perspective of what we build in America, and why. Together we discover how the work of the real estate industry connects to every American. In season two, we focused on how buildings changed as a result of the pandemic. In this season, we're revisiting conversations from previous seasons, to see where Americans put their heads down at night. Together, we will discover the many definitions of home across the New York City metropolitan area, which includes over 23 million Americans. Each week, we'll visit a new building and explore complex and confusing issues related to housing access to see what they can teach us about ourselves, and our country will meet those who work to develop in thoughtful and impactful ways, who build neighborhoods to be more sustainable, affordable, accessible, or inclusive, who labor to create thriving communities, and transform the lives of generations to come. Through their stories, we will humanize often polarizing topics. Profound, surprising, and hilarious. This show is for developers and builders with boots on the ground for innovators trying to find ways to improve our industry, for the policymakers and public employees. And for any person who has walked by a building and wondered why. And now your host award winning architect turned developer and startup founder or Atif Qadir, AIA.
Atif Qadir 1:53
This is American Building. And I'm your host, Atif Qadir. I'm the founder of Commonplace. Join me as it take a drive by the skylines and strip malls, crosswalks, and rail crossings, balconies, buildings and boroughs to discover a new generation of housing, let's build common ground.
Atif Qadir 2:25
In this episode, you will learn about the different types of housing that is built in the US the scale of the housing crisis in our country, and a contextualization of how that crisis, particularly affects black Americans. So let's talk about types of housing. And real estate terminology. Housing is referred to as the residential asset class, which is distinct from office retail, hospitality, industrial and institutional asset classes. Residential is broken down into subcategories, based on how many people live there, who lives there, and in some cases, how much they earn. Single family homes are the dominant type of residential in the United States, encompassing 82 million of the 120 9 million homes in the US today.
Atif Qadir 3:20
They are freestanding structures surrounded by front rear and side yards. So that's probably familiar to many of our listeners. Townhouses are also one family but typically they are attached rather than detached. Multifamily Housing describes buildings that contain multiple units, and are often referred to as apartment buildings. multifamily buildings can be senior housing, which is age restricted. Student Housing, including college dormitories typically require enrollment in or affiliation with the university. Affordable or workforce housing is meant for lower income folks, with or without regulations binding who can live there, single room occupancy, or SROs, are multifamily buildings with shared bathrooms and kitchens. So effectively, you could say dormitories for low income people. homeless shelters have shared bathrooms and kitchens, as well as shared sleeping facilities.
Atif Qadir 4:20
This doesn't encompass every single type of residential there is or every variation there can be. But this effectively is the the universe of residential United States today. So I mentioned that there are 129 million housing units in the US. Is that enough for a country of 332 million people. The average household size is now 3.1 People which is down from 3.7 in the 1960s. Using basic math, I did go to MIT we theoretically have enough units, but when you account for housing under supply in certain areas, and oversupply in others, units being used for short term stay like Airbnb. Less than 100% occupancy in the units that do exist, and even people owning multiple homes, and of course, people not being counted by the Census, we end up with an under supply of 3.8 million to 7 million units of housing depending on who you ask.
Atif Qadir 5:20
In a great article for The Atlantic writer, Annie Laurie lays out the numbers and there's a link to the article in the show notes. How we got here is a complex entanglement of public policy, regulatory oversight, budget priorities, land use decisions, construction codes, and financing with a healthy dose of politics and fear. How we get out of this housing crisis may be even more complex. We will explore this in the current and following seasons of American building podcast. In this opening episode of season three, I am talking to architect Sean P. Sean and developer Omar Kareem. Sean is a founding partner at PGn architects, which was recently acquired by Michael Graves, architecture and design. The firm's design work focuses on affordable and market rate residential projects and mixed use projects along with renovation and historic preservation. He is a board member at Eastern Market Mainstreet, an economic development focused nonprofit.
Atif Qadir 6:29
He began his career at Skidmore, Owings and Merrill, and as a graduate of Howard University. Omar Kareem is the president of Banneker ventures, a real estate development, construction and property management company. The firm focuses on residential and institutional projects. Omar is a lawyer who began his career at Kramer Levin NEFT, Alison Frankel. And like Sean, he is a graduate of Howard University. Thank you so much for being here with us today. So I want to start off with a really important question in terms of what home means to each of you. And I want to start off with Sean.
Sean Pichon 7:10
So Home to me is a family. I grew up in Los Angeles, California, South Central LA, not surrounded by nothing but family. So food culture, cousins, tons of cousins, and everything that comes from that. So your social network, your structure, so you talk about religious structure, you talk about your schooling, all that is kind of wrapped up in where you live, and who you're surrounded by your community.
Atif Qadir 7:47
And how about for you, Omar? What would you what do you think of when you hear the word home?
Omar Karim 7:52
So I think about kind of safety and security and relaxation, a place where you can be vulnerable, and run around, and kind of outdoors and indoor spaces and a lot of sleeping, like, my daughter was going through my phone recently. And she found all of these photos of me on my phone of me sleep. And you know, she's nine. And so she must take my phone every time I'm asleep on a couch or somewhere. She's taking just over the years, and there was all of these photos. And then we found a video of my 14 Yo, she's 50 Now have a video actually, while I'm asleep. She's taken a video, she's talking about me, right? That's home, I would call it joy. I'm very happy when I'm home.
Atif Qadir 8:48
So both of you are talking about topics of family and being together, which are things that I would consider it what I think of home as well. So Omar, as a real estate developer, you add a in some cases, in some ways, a unique start, and some guys maybe not so unique, but I'm interested to hear from you what your path into development was.
Omar Karim 9:11
Yeah, so I got started. Because some of my I was practicing law in New York with a big farm and some buddies were down in DC buying row houses and multifamily houses using a program called NACA, where they helped kind of a lot of times first time homebuyers and folks in underserved communities purchase their homes through a no money down program. And I was thinking to myself that was paying all this rent in New York man I probably could do that. And so unbeknownst to me how difficult it was in New York I started walking down the streets and looking for homes to buy. This isn't the kind of the 2000 2001 with three and I landed up and bought a home at 120 Darden Lenox Avenue and we renovated it and wound up having a four unit building Get 90 days later, after we close on the first one, we purchase another one in Bed Stuy, Brooklyn. And then from there, I had an opportunity to work for a black woman developer in DC, and I came down, and she gave me a shot to do large scale real estate development projects and help her run those projects, incredibly grateful for that opportunity. And then after working a number of years there, we love them. We started Banneker about 18 years ago.
Atif Qadir 10:30
So the NACA program that Omar mentioned is the neighborhood Assistance Corporation of America. So home buying program that's 0% down. And I understand the the the person that was your mentor initially said no to you working with her, could you talk about what that process was like?
Omar Karim 10:47
Yeah, so I didn't even know developers existed, quite frankly. And I read about this woman in Essence magazine, and her name was Pamela Bundy. And she ran a successful small boutique development company in DC. And I said, Man, I really want to go learn from her and go work for it. And so I wrote down a list of all of these things on a sheet of paper of how I could be helpful. I could be your general counsel, I've been a lawyer, and I could run your deals. And, you know, I've done these renovation projects, I could work on solving all of these things. And she said, Well, let me think about it. I'll call you back. And she called me back with a period like the same thing. She said, I thought about an answer is no. Oh, and by the way, I offered to work for for free. And she told me no. And I was like, wow, that's interesting. So I moved down to DC nevertheless. And I'm not gonna say I stopped her and the Navi two type thing. But I saw I had a couple of events. And I was like, hey, what about, you know, the guy that offered you, you know, an opportunity to work for you for free? And then one day randomly, she called me and she said, Where are you and I was finishing up a deal in New York, and I came down, met with her and she offered me the opportunity and pay me $400 A week, right? So I was used to making not quite 4000 a week in New York, but close to it. And I was so grateful for that opportunity, I would have if she would have said, Hey, pay me $400 to work for I would have done that figured out a way to do it. And it was just amazing opportunity for exposure, I think in our industry to get an opportunity to get exposure to be trained and have an opportunity to work on very large, complex projects. It's a game changer.
Atif Qadir 12:32
So Shawn, I want to understand from the projects that you guys, both Shawn are you're doing together, give me the lay of the land in terms of the types of projects that you are working on together, and some of the details of them.
Sean Pichon 12:45
So between Banneker and PGn, and Michael Graves, we've been working on a couple of opportunities of recent, the 20 to 20. MLK project is a project that's done with a church entity, where we're looking to add some affordable housing to the church, revamp their existing conditions and build new housing above. We have to go through a historic process for that that's been a very challenging process, the neighborhood that is in historic Anacostia, there's been some pushback on development of certain scale. And there's been a lot of community outreach and outrage of late about development, particularly around some of the community assets to the black churches that have been in these communities for years, and their ability to, you know, expand on their assets and, you know, continue to survive in a community that they've been supporting for decades. So we've been battling. I know Omar and I have had some some late night meetings in that community and some some pretty heated discussions with with several people where, you know, it's been about the focus of providing quality housing to communities in need. And that is really at the heart of what we do. We do a lot of affordable housing projects. A couple of projects that I'm helping assisting Omar on is he hasn't construction ones a senior housing project, and the other is the affordable housing project, or large scale projects podium stick in terms of this types of construction that we refer to where it there's one level of concrete and then the remainder of the levels are, are wood construction is a unique construction type. Not everyone's familiar with it, which is why I was brought in by Omar to help sort of bridge some of those gaps because we've done over our years.
Sean Pichon 15:00
Since 2004, we've probably done a tremendous amount of affordable housing projects in that same podium stick construction tight, so that we're assisting on a couple of projects with them. They're helping them through the construction phase. And then we're also looking towards the future, some larger projects and larger scale projects that are on the horizon 180 unit project over on Alabama Avenue, and another one in Prince George's County, which which is on the horizon as well. So we're looking forward to doing great things in the future, building off the success that we've already had.
Atif Qadir 15:42
And the projects that you mentioned that 2220 MLK Avenue, the Clara car Plaza, senior housing, the roll arc and the pavilion. So I want to dive into one of the questions that you mentioned, or one of the things that you mentioned in your response was about the the outreach that is being done for particularly the first project 20 to 20 MLK Avenue, and then some of the community response back, and you specifically said outrage. So sales and acquisitions of church property have been particularly active as the commercial observer did a great article about that focusing on black churches across the southeast, in terms of those properties, converting to a residential. And I want to kind of get a bit more of an understanding of what was particularly happening in this instance, that that caused the community to respond the way it did.
Sean Pichon 16:35
Well, for for that project. In particular, there's been a faction of the existing community that has been pushing back on the amount of affordable housing in the area. And, and the size and scale of development, the existing fabric of the historic Anacostia is a two three story kind of rural house type developments that have been used for commercial uses over the years, it's a commercial strip is zoned for much higher density, and then the neighborhood kind of rises up behind it on hillsides. And they have beautiful views of the monuments and the architecture of BC. And those views are are astounding, get up behind these the commercial strip, well, there's there's a faction of the community that believes that some of these developments are going to hinder their ability to have this quaint neighborhood feel and reduce their their view access to the watershed and the monuments and things of that nature.
Sean Pichon 17:52
But what they don't really understand is like, you know, there's topography there, that changes that allows for the views to exist, no matter if we build a four or five storey building, they're still able to see over top of those buildings from their vantage points. And with that, the ability to support the types of retail, the types of services that the community desperately needs, you have to have a certain amount of density to support those facilities, those uses, and there's just a lack of understanding of, of how that economic system works, where people want certain things, but they don't want the things that help those things come into existence. So it's a it's a battle of explaining and educating people in the community.
Sean Pichon 18:45
At the end of the day, most people do come around to understand, but there are some forces out there that, that use that I guess, pivot point or Flashpoint as a as a source of power and an ability to command and do things that are not necessarily in the community's best interest. And so you end up fighting against some of those types of voices that have gained momentum over time and have a loud voice might not be the best voice might not have the right intention or the understanding that that's necessary, but they're loud. They gained a platform. And that's sort of what we've run into. And we've been battling that for quite some time. My first time running into the same group, we had a project just a block away from the MLK site that we had to take all the way to the mayor's agent, because the community was so far pitted against the development. And eventually we got it done but it was a lot of hard work and effort that is probably on necessary.
Atif Qadir 20:01
So amongst the many challenges that a development team has, one is communicating and interacting with the community, as he described, and another really large one is funding. So Omar, I'm really interested in what your experience has been on raising capital, particularly debt for your multifamily properties, and perhaps using this one as an example 20 to 20 MLK Boulevard?
Omar Karim 20:27
Sure. So raising capital is always an interesting question. I think over the last couple of years, raising capital has kind of gone from very, you know, are difficult to a lot easier to now with rates, and a doubling in the last 12 months to a little more challenging. All of the projects that we're working on have really complex capital stack. So you know, Martin Luther King bill, it's a fordable housing, low income, housing tax credit, equity, finance deals, so, you know, has tax credits and bonds and, you know, grants and other things like that to make the deal pencil. And we have another project that 2323 Martin Luther King about a block away, another similar, you know, complex tax credit, equity bonds, you know, construction, financing, grants, and other things like that, you know, we talked about our Largo deal, or a couple of minutes ago that that PGn is working on. And we're super excited about that we were going on a walk through yesterday, and so with a major regional bank about getting $160 million loan for, to the building. So we're super excited that they're super excited to walk with us through that, through that structure. It's a $340 million total development cost project. And that has, you know, traditional construction, financing to permanent financing. Traditional equity, we have money from the state, the governor just put into money on the state and the state budget on Monday, which was excited about, there's a pilot, as well, that's, you know, pay in lieu of taxes, unless going in to help cover some of the infrastructure costs. So a major economic development project and a county and a lot of various different resources.
Atif Qadir 22:17
So the Low Income Housing Tax Credit Program that you mentioned, is a major program that distributes about $12 billion a year and I think it results in about 80% of the affordable housing in the United States is somehow tied to the light tech program. I'm really curious about what the experience is like on the ground with a lender because so Colette Coleman wrote for The New York Times recently about the racial disparity in developers across the country, where approximately 5%, I believe, the exact number of the article being the shownotes. But about 5% of developers that were part of this research, were not white males, which means that that's everybody else, including myself and Omar. So talking about when you are interacting with lenders, what some of those experiences are, like on the ground?
Omar Karim 23:04
Yeah, well, that's a good question. The folks who did the walkthrough with us yesterday on the site said that 99% of their developer borrowers are white man.
Atif Qadir 23:15
So it's even more stark to the number I had. So there you go. Yeah, it was,
Omar Karim 23:19
I mean, I just brought it up, right. Like, it didn't seem like anything necessarily was wrong with that, and, but we didn't have any white man on the walkthrough from the bank, either. So it is, you know, I would say people of color, don't have the opportunity to get into real estate development or large scale, you know, projects, and therefore, you know, where a lot of money is oftentimes created over generations. And, you know, the lending community, fortunately, over the last couple years has been, you know, community development, financial institutions and other nonprofits that have benefited, you know, through the largest of other large institutions. As a result there, they've been lending some of those funds to black BiPAC, as they call them these days, and developers, and that's helped pretty significantly, there's a lot of CDFIs who have 50 million 100 million, several 100 million dollars to help do that, where traditional banks when otherwise lend us money.
Atif Qadir 24:28
So Sean, I want to get an understanding from your perspective of the projects that we've been talking about how they stack up against your definition and your metrics of impact on the projects you're working on.
Sean Pichon 24:43
I think as far as impact goes, there's a huge social impact to a lot of projects that we work on, and for good reason, like what we're talking about with the 20 to 20 MLK, that's taking a historic or resource community resource and giving it a new foundation for future community use, we look at that as a as a huge of impact for not only benefiting the the community that they exist in, but it's a, it's also a an economic driver for, for future families to be able to set a foundation on having quality home environment environments, and safe neighborhoods is, is a huge step in the right direction for a lot of our families who suffer from the lack thereof.
Sean Pichon 25:49
So any project that we're doing that's promoting safe, quality housing, that's affordable to people of all means, is a benefit to not just the community that they're in, but the communities at large. Because the more we have people in safe housing, the less people are anxious, the less people are feeling left out. The less people are, the more people want to be a productive part of society. They want to be a part of the society that they're in. So housing is a key component of that. And we're doing a lot along those paths to create that for our community.
Atif Qadir 26:36
Similarly, how do you define impact? And how do you measure it for yourself on your projects?
Omar Karim 26:43
I think, at Banneker, I was talking to one of our staff like, and I would echo what Shawn was saying. I mean, really, we live in these communities, we work in these communities, right? We in you know, around these communities all day long. So it's not a it's not a new thing that we've been doing. It's, it's who we are right? From who we hire, right? People on our staff look like the folks in these communities. Number one, our subcontractors are from these communities. Number two, they might have, and we've been investing in it for years and years and years were 18 year old company, we've invested in folks over the years, and I'm happy to know that people who are doing small home renovations are now doing large scale, you know, multifamily mixed use projects, right, they have crews and they have trucks and I guess storage lines of credit, and all of these amazing things, but it took a lot of work on our part to, to do that.
Omar Karim 27:52
And to to invest in them and that but that's that's who we are. We give our students scholarships to go to college. Unfortunately, we pay for burials. We train people, we we gave out about $30,000 worth of bikes last year, last year, the year before to help people get out after COVID Or you know, when the city was trying to get people outdoors. We sent a young lady to the Olympics, right? In 2016. And she she got a silver in fencing. She's the first few Japie to ever compete in the Olympics. Oh, that's
Atif Qadir 28:28
it. If the hash Mohammed, she's from New Jersey,
Omar Karim 28:31
yes, I was her sponsor and just met her randomly one day talked about what our goals and what our sister's goals were and what they were doing. And it wasn't a huge lift for us. And I mentioned that to if you had a couple of months ago, and she said, Omar, but it was everything to us. Right? It was everything because they didn't have the financial resources to travel around the world and get the points as needed to make the Olympic team. And so those are the things that we do a, you know, working with Shah, and you know, his firm and to be able to do that. And as a sponsor and a developer, I could pick whoever I want.
Omar Karim 29:10
And, you know, now we're working on four deals together, which is absolutely amazing how our grads working on you know, our buildings were right next to one another to architect, the engineers who are right next door or six, three, or how is campus and four years later for us to be working on hundreds of millions of dollars and deals is that real impact? So then Shawn can hire people and, you know, do all of the amazing things that PGn does. One last anecdote. There was a young man here who came out and I interviewed him for a job and, you know, I asked him what he had done and he said he had he had robbed at McDonald's. And I asked him well, how much did you get? And he said nothing he got caught
Omar Karim 29:59
And he's been with us 10 years, right? He's making, you know his spot to be making over $100,000 a year, and is doing an amazing job as a superintendent for our organization, and I love him. That's me as twins, and then you're able to take care of his, his boys and his family. That's impact. And, you know, I just briefed with one of our project managers, and he was telling me how much he's grown with the projects. And so you have multiple people working together and impacting one another. So,
Atif Qadir 30:31
so what you're describing is the exact opposite of what most people think of when they think of real estate developer. And I think that stories like yours are absolutely worth telling. They actually remind me, what you described reminds me of a developer in Detroit named Matt Temkin. And for him a lot of what his the way that he measures, his impact is on the things beyond the construction site. So the relationships that he builds and the bonds that he helps to develop in order to develop and establish a strong community.
Atif Qadir 31:01
So I want to talk about the availability or the lack of availability of housing. So I based in New York State and Governor Kathy Hickel, announced her goal for building 800,000 units of housing across the state of New York City Mayor Eric Adams, had a similar goal of 500,000 units in the greater New York City area. And both of you are located in DC and the mayor of your city has announced her goal of getting 36,000 units of housing built in the district by 2025. So this is a very densely populated city, and also high growth in terms of Maryland and Virginia area surrounding the city. So I want to get anecdotally from you. How do you guys think of and conceptualize the lack of supply of housing and how that's impacting communities in DC and around the area? I'll start off with Omar on this one.
Omar Karim 31:54
So I would say I think, Mayor Muriel Bowser, our merit and the district has been doing an amazing job, she set an ambitious goal a couple of years ago, and put a lot of resources in that. And it's just been moving the train down the track very quickly. And as a result, she has been able to produce a lot of housing in our city, which is desperately needed. Unlike San Francisco and other other places around the country. You don't have you know, homeless encampments, it's all across the city, as you do in some of these other, you know, tough environments. And you need a really public private partnership, you need a lot of public money to go in to solve our housing needs. And you need regulations, reduce it so that you can get things done quicker, right, safely, but faster. So, you know, we have a permit process in the district that you can expedite and get permits just in a couple of months. That's unheard of in many areas.
Atif Qadir 32:57
I think we need that process in Hoboken, New Jersey, so you can send it over to us.
Omar Karim 33:02
It Well, I'll let the mayor know, it's usually go out of there of hope. Okay. But you know, I would just kind of, and you need good leadership at agencies, so people who share all the way around from the planning board to, you know, historic preservation folks to permitting folks and who really partner with the development community in the district, I would say development community is no longer a boogeyman and bad part and parcel because there's more folks who look like Sean and I and you who are working on both projects.
Atif Qadir 33:38
And I think the what you're speaking of is this really complex soup of issues that has led us to where we are in terms of a lack of housing, which is estimated to be somewhere between three and a half and 7 million units. So in terms of under supply across the country, and that's everything, like the things that you mentioned local entitlements, federal legislation, access to capital to develop projects, Design and Construction Code issues. And then of course, everyone's favorite fear in politics. I think all play into those. So I want to dive into something that I've learned recently and was really fascinating on is statistics of black homeownership and the country this question will be for you,
Atif Qadir 34:19
Sean, in terms of some of the statistics that I've seen in the Atlanta Journal Constitution, and say, for example, the Bureau of Labor Statistics are some of these numbers are really stark in terms of access to resources to purchase homes. So number one I learned is that black men are paid 70 cents on the dollar relative to white men and black women are paid 82 cents on the dollar, relative to white women and in particular, the net worth of the average black family was $24,000. In 2019. When was last measured in comparison, the typical white family just ate x of that at 190,000. Now taking those statistics and bringing them to the case have access to housing. The homeownership gap by race is also really stark, in that the homeownership rate for white Americans last year was 73%. And for black Americans, it was 44%. When you hear statistics like these, in the context of you as a real estate professional, what are some of the things in terms of anecdotes or experience that you have that that might be, you might offer as color to some of these numbers that I just mentioned?
Sean Pichon 35:29
Yeah, I mean, as Omar said, as he was walking around with the bankers and the 99%, white, the one thing that when I, when I graduated from Howard, I was, you know, Howard taught me everything. I was young, altruistic, wanting to save the world kind of guy. And I had this crazy idea when I first started off to start this nonprofit group that would go into neighborhoods and basically beautify them. So as as I learned through the process, and gentrification is a G word that no one wants to talk about. But really, gentrification happens to non homeowners. So if you don't own you can get pushed out of your neighborhood. If you own you are making a decision to sell. And I think the articles that you sent over with the Atlanta Journal, talked about the predatory, I guess, focus, hyper focus on the black communities of the homeowners, the ones that we actually have managed to become homeowners than their assets are then targeted through the years.
Sean Pichon 36:51
So my concept was around, if you're gonna sell, but sell for the most money, so you go into the community, and you beautify the whole community, because when you're, when your credit tour really buying, you're buying assets at a lower than market value, range. And the way you do that is you're going to in neighborhoods that don't look as good as other neighborhoods that don't have this treat curb appeal. So this whole concept was around, like, how do we help our community get the maximum dollars for what what they eventually are selling, and you know, there's just this natural progression of real estate changing hands over time. Anyway, I was told a very long time ago, that's a crazy idea what he's talking about, and he's gonna, who's gonna just give away money to people to plant plants and paint houses and repair, do minor repairs and stuff like that?
Atif Qadir 37:56
Sounds like you should call up a Bloomberg Philanthropies, they might actually be a big IP
Sean Pichon 38:00
into it, saying now, but that just goes to show you where my mind was even coming out of school. And since then, I've I've learned more about the real estate industry, and what my role as an architect is within that, and then I quickly learned the flip side of that. I was told and Howard at Howard by one of my professors, that and maybe first or second year there, said, I hope you understand what you're getting into architecture is a white, an old white man's hobby. This is what you're going to focus your whole livelihood on. Yeah,
Atif Qadir 38:46
Architecture is an old white man's army. Right? That's all right there do you agree?
Sean Pichon 38:54
Yeah, we got to get a t shirt. And I didn't really understand it until I actually got out into the profession and started practicing what that really means. And to have, be on a on a podcast like this, to have a person of color sitting next to me as as a client of mine is a huge thing. Because that was what he was talking about. We don't have the financial wherewithal to be able to afford someone who wants to understand what their, their architecture and their lifestyle could be like. They just want quality housing, they just, you know, it's not a it's it's more commodity than it is a designer preference. So what that meant to me was how do you build communities? Because in order for me to have a career, I needed to be able to create wealth within my community. So my own community could hire me. So my focus was on helping developers understand how to maximize land, how to really capitalize on untapped value.
Sean Pichon 40:15
So that became my focus, and my ability to offer value to the processes, understanding the planning side, understanding the financial side as much as I could, but trying to put all those pieces together so that I could, I could talk with potential developers on how to look at a piece of property and see as true intrinsic value. And I think that's where we found our niche. And where we succeeded over the years is that we've, we have a huge success rate in getting projects approved through some of the toughest scenarios, and one of the toughest environments in the country. And DC is ranked up there with, with with the toughest cities in terms of, you know, approval processes. And we've, we've conquered them all, in our in our years. And we see that as, as part of, you know, you're talking about before that how do you measure success, but our success has been helping developers build and grow. We've watched developers go from, you know, just starting to bring huge development companies.
Sean Pichon 41:38
And, and along the way, we've been able to help tailor them on the values that we have, and helping them understand how to understand that and really see that from just looking at a piece of land on a piece of paper, and being able to understand what the where the where the real value is in that. So I think that for us, you know, home ownership to bring it all back. Homeownership is a huge key for increasing wealth, generational wealth, and we lack it, the numbers don't lie. So the more we can do to educate our communities to help them understand and invest in themselves. Because another quick anecdote, and then I've been rambling for a little while here. But another little quick anecdote is, I went back to I graduated Howard in 95, I bought my first property in 98. And I didn't really think that through as the impact that that had, but that's three years out of school and purchasing a home in the District of Columbia.
Sean Pichon 42:58
Well, ultimately, that led to my success, because now I have an asset that's did nothing but gain value over the years. And I joke with my neighbors, now, it's, I can't even afford to live in my own neighborhood. But I just bought it the right time. So it's a it's a thing, that if, if I had the ability to educate myself, back then I would have been talking to more than just me, my parents, people that had some ability to have some extra wealth around that they could have purchase back then. And the difference that would have made it just in my personal family, it would have been a huge change in our trajectory as a as a group. So I like to say, you know, people need to be educated and they need to invest in themselves and in our homeownership rates will go up.
Atif Qadir 44:06
So I want to add one thing for our listeners, as Sean brought up the point of predatory buyers. So those are institutional investors that he's referring to that have been very large players in the single family home buyer market since the pandemic buying boom. And in particular, the research that he was mentioning in the Atlanta Journal Constitution had uncovered that Wall Street landlords are more than twice as likely to buy homes in African American neighborhoods than a majority white communities. And in some majority minority cities like Phoenix, over a quarter of the home purchases were done by institutional investors, not typical owner occupant type buyers. So I think we've talked quite a bit about the statistics about the anecdotes and about the impact of what homeownership has.
Atif Qadir 44:57
And I'm curious from your perspective. Sure. on in terms of the rates of black homeownership to change and the initiatives that are necessary to change it, what are some of the things that you believe should be a part of a plan going forward? For so for example, DC or the greater DC area?
Sean Pichon 45:15
So great question. I think the mayor has done a great job setting forth a task force. We recently to black homeownership, StrikeForce, they brought together some of the top minds in terms of people that have been working with the underserved communities on what it means to be a homeowner, how to get there. So those programs are critical, talking about earlier about investing in yourself. So I think these programs like what the district is doing, nonprofits like mana that have a home ownership training, they take people through the process of starting with, you know, you're setting, you know, monthly limits and, and finances and how do you start that process of getting your credit to the point where you can purchase so they take you through that process and get you to the ability to be a homeowner, and then get you into a home and then help you maintain that over time.
Sean Pichon 46:22
So I think programs like that are critical. That's an educational value to our community. There's also the Douglass Community Land Trust, which is a new concept that they actually pull money together, and they buy properties or have home ownership that allows people to purchase homes at an affordable rate, but still gain equity through that process. And so their role is to come in as a the the in between the create that ability for the equity to be transferred to the homeowner that sells but then allows the new homeowner does still purchase at an affordable rate. If that makes sense how that that works. I don't understand all the details of it. But it's the concept of it is phenomenal.
Sean Pichon 47:22
Because one of the issues we found in DC is the affordable housing, the mandatory ice requirements. It works in a rental market, and it has worked in a rental market for years. But we were there's not as much for sale stuff going on now. But when we were doing a lot of for sale, housing, developments, condos and things of that nature, the ice component of it was very difficult. Because you have to go through a process to get pre qualified by the city agency. And then those units are then held and sort of like a bucket until those homeowners are available and identify. But then you're also limited in terms of what they can sell for. So you get the ability to purchase a home as a homeowner, but you don't get the positive side of equity grow on the backside, because you're still limited in how much you can sell it for later to maintain that affordability.
Sean Pichon 48:33
So that is kind of I think, where the land trust community, Douglas community land trust comes into play. It's like they figured out that matrix where it wasn't working from an IT perspective, and they're coming in to help facilitate that, that process. So I would hope for a lot more of those types of things exists because that is the true value of homeownership. I mean, you want. You want people to have starter homes, you want people who have graduated as a family grows into larger homes you want you want people to be able to walk that trend of homeownership. And the only way we're going to be able to do that is one they have to be affordable to you have to be able to get equity out of it. Because that's the only way to grow to the next step. And, and three people have to be educated in what it means to be a homeowner.
Atif Qadir 49:32
So I think that that's a that's a great collection of recommendations and to highlight those that's financial education, Legal Aid, direct assistance and housing production investment and really great projects like the ones that you and Omar are working on. So thank you so much for joining us today, Sean and Omar and I'm really looking forward to continuing the conversation of the rest of this season.
Atif Qadir 50:03
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