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How a real estate program could lead to more equitable development in Detroit’s neighborhoods

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Better Buildings, Better Blocks is helping Detroiters invest in their own neighborhoods

LaFerte Terrace, a property that’s benefited from Building Community Value
Photo courtesy of Jon Zemke

Ask anyone who’s fixed up a residential or commercial property in Detroit about their approach and you’ll likely get a wide variety of answers. The process is neither streamlined nor intuitive, but some programs aim to help. Better Buildings, Better Blocks is a real estate class that teaches people how to navigate multifamily real estate development in Detroit. The intent: Build up the neighborhoods by way of real Detroiters.

The six-session class teaches the nuts and bolts of real estate, but in between these practical sessions, participants talk about the changing landscape in the city, with discussions revolving around their dreams of fixing up a storefront in the neighborhood and opening up their own business. The instructors give attendees access to resources needed to navigate the difficulties of Detroit real estate, and participants are encouraged to connect with each other, team up, and learn from each others’ projects.

The class is taught by Dietrich Knoer of the Platform and run by lawyer Chase Cantrell and his nonprofit, Building Community Value. The class aims to help Detroiters make real change in their neighborhoods and build wealth through real estate.

Participants in the summer session of Building Community Value
Photo by Kardiak Films

Cantrell tells Curbed that this class is important right now for a few reasons. There’s currently an inequitable distribution of power in development—major developers and outside investors, rather than native Detroiters, control much of the scene. Cantrell also notes that because of the scale of blight across the city, if we don’t get people involved, some neighborhoods might vanish completely.

Over the sessions, the class builds up to a final presentation, where students present a Detroit property to rehab. In the presentation, they talk about the neighborhood, why they were drawn to the property, its condition, how much work it needs, and how much to charge for rent. At the end of the class, attendees vote for the best presentations, and the top projects receive a cash award to be used toward the presenter’s next project.

In this summer’s session, Corey Williams’s project was chosen as one of the best. Williams recently finished renovating a storefront on McNichols, and has plans to renovate more commercial properties; in the class, he connected with an architect who’s working with him on his next project. “I met several people in the BCV class who have helped me fulfill my company’s mission to make urban communities more safe and more comfortable to live,” he says.

When choosing properties to present, participants look at a number of different factors. The class talks about the power of 10: a property’s walk score and safety, and its access to schools, parks, retail, transit, healthcare, groceries, and other amenities. It’s tricky here in Detroit; not many neighborhoods have these amenities. But presenters should know what’s in the pipeline in the neighborhood, and how values have changed in recent years.

These presentations can help move the developer toward bigger projects and formalize their process. This is especially true with the pro forma, the spreadsheet needed to accurately lay out the financial plan for a property so the banks know you understand what you’re getting into.

Jon Zemke, who’s finished multiple projects in Woodbridge over the past several years, says the class helped him prepare and formalize the pro forma, and also introduced him to many development professionals outside of his circle. One participant interested in real estate helped Zemke with his current project, LaFerte Terrace.

Chase Cantrell
Photo by Kardiak Films

But the class isn’t just financial; discussion often turn toward race. In one of the sessions, Cantrell states that it’s historically been more difficult for people of color to get financing for development. Classes like this offer newer developers a chance to know and see who’s actually doing development and how funding can be accessed. Development roundtables, online groups, and events with other participants are a few ways that those who’ve taken the class stay involved and make the leap to development.

The class is representative of the city in terms of race, location, and experience or involvement with real estate. All seven districts are represented. Cantrell says they choose a mix of participants: people who have done these kinds of rehabs before, those who haven’t but are interested, and those who represent community groups. But since they’ve started the program (they’ve had six cohorts), the attendees have changed. They’re coming in more knowledgeable and more are interested in commercial properties.

The Summer 2018 Building Community Value cohort.
Photo by Kardiak Films

The summer 2018 final presentations were diverse: a duplex in Islandview from a woman who hasn’t done any renovations, a health center in Brightmoor planned by a health professional and native Detroiter, a duplex in Bagley that’s been owned by the student’s aunt, new construction planned in the Villages by an experienced developer. And as students, teaching assistants, and instructors watched the presentations, participants were enthusiastically encouraged to go forward.

The class can’t give the students the money they need to start their projects—although it’s affordable, at $100. But it can give participants the knowledge they need to approach these projects realistically. By growing each person’s network and knowledge base, ideally, Detroiters will be able to invest in their own neighborhoods, creating more equitable development across the city.

Editor’s note: I attended the summer 2018 Building Community Value sessions to learn more about the real estate landscape in the city.