They've made it to the top of their professions, but high-powered Black commercial real estate experts still remember the biggest challenge they faced when starting out — finding funding.
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By far the hardest task for diverse talent is figuring out how to access capital, said attorney Adeola Adejobi, who founded the Avant-Garde Network to bolster Black and diverse professionals working within a variety of industries. Adejobi and the Avant-Garde Network covered this topic, among many others, on the organization's annual Diversity in Commercial Real Estate Virtual Summit on Saturday.
"Having capital unlocks additional opportunities, having the opportunity to build capacity and seize opportunities that exist," Adejobi said.
During numerous public sessions with Black commercial real estate leaders, it became clear the industry's fight is both economic and political in nature.
"Currently, considering the results of the most recent presidential election, we will be talking about what the future of America will look like in commercial real estate and how the government should play a part in creating equity and access to communities of color, specifically Black communities," Adejobi said.
Don Peebles, founder of national real estate investment and development firm The Peebles Corp., said finding capital was the greatest challenge he faced when entering the profession during the budding 1960s civil rights movement.
More than 40 years later, it isn't much better.
"There is about $70 trillion of venture capital ... and out of that, 1.3% of it is allocated to firms run by people of color and women combined," Peebles said while speaking at the summit.
"What you are looking at is basically 98.7% of all capital to start entrepreneurial businesses, including real estate. So what that does is it makes it impossible for African Americans to break into real estate entrepreneurship because real estate is a capital-intensive business."
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Peebles credits mentors he found in Washington, D.C., at the height of the civil rights movement for his success in real estate. These mentors trained Peebles and guided him through an early post on the property tax appeals board.
Peebles then decided to build a commercial office building in one of the commercial quarters destroyed by the 1968 riots. Were it not for a mentor who took Peebles under his wing, he never would have broken ground on the project.
"He was willing to take that kind of chance," Peebles said. "So if it wasn't for him, I would not be here today, he was willing to take a chance and knock down barriers."
Black talent on the development side faces similar obstacles in Atlanta, a market where H. Jerome Russell Jr. is carrying on his family's legacy as president of construction and development firm H.J. Russell & Co.
Russell sees a dire need to close real estate development opportunity gaps using both political and community-driven initiatives.
"We have to take the best of what Black real estate entrepreneurs are doing and platform that out to the capital sources and be able to use that as leverage to bring others in," Russell said. "There are a lot of emerging developers, but the challenge is access to capital; and it's a tough, uphill battle."
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Even Black professionals who came up in the capital side of the business, like Basis Investment Group founder and CEO Tammy Jones, see diverse developers and investors struggling with capital challenges today.
And it isn't just dollars they're having trouble getting their hands on.
"When people think about capital, everyone focuses on equity," Jones said. "But it's just as hard if you are forming a company to get access to working capital lines, subscription lines, facilities ... and you need those things to create your company."
Jones' firm, which she started a decade ago, invests and lends across the capital stack on different types of assets. That makes her unique; the number of Black entrepreneurs making decisions about where capital actually goes is scant, she said.
"If there is another African American, [woman-owned], diversified commercial real estate platform, I would love to meet her," Jones said. "They say I am one of the only ones, and they say 'you are a unicorn.'"
Though it can be exciting to be a pioneer, Jones said it shouldn't be this way.
"It also really breaks my heart because I shouldn't be one of the only ones in 2020 because this is such a great rich industry that can create entrepreneurs and wealth."
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