Origin Stories: The Collective's Tayyib Smith On Carving Out His Place In 'Structurally Racist' CRE Industry
This series delves into the myriad ways people enter the commercial real estate industry and what contributes to their success.
Since he formed Little Giant Creative as a music-focused creative agency, Tayyib Smith has launched several different ventures and expanded into diverse forms of business with a level of confidence he calls both a blessing and a curse.
When that entrepreneurial drive led him to open a coworking space, Smith said his confidence entering commercial real estate presented almost as naiveté. But as he learned more about the industry and the barriers facing any person of color who wants to break into CRE, it only strengthened his resolve.
From that coworking space — Pipeline Philly at the Graham Building, a stone's throw from Philadelphia City Hall — Smith has co-founded development firm Smith & Roller and incubator for minority- and women-owned businesses If Lab. Most recently, he's helped launch The Collective, a combination private equity investment firm funding Black-led real estate development and nonprofit advocating for policies to redress legacies of redlining and other structural discrimination in real estate.
The way Smith sees it, the disparity between the portion of Philadelphia's population that isn't White and the percentage of property and capital controlled by non-Whites amounts to "contemporary apartheid." By opening more doors (and wallets) to people of color in commercial real estate, Smith hopes to drag the industry more toward equity — without any illusions about how dire the situation is.
The following Q&A was conducted over the phone and has been condensed and edited for clarity.
Bisnow: How did you get introduced to CRE?
Smith: In the downturn of the economy, my main company, Little Giant Creative, moved into a space called DevNuts at Third and Brown [streets] in Northern Liberties. Meegan [Denenberg], my business partner, and I found a lot of things that we liked about the business model. But to be frank, the average age was 24, it was all White men, there were a lot of cultural competency issues with the space and the bathrooms were trash.
So we pitched [The Method Co. founder and President] David Grasso on developing a coworking space, and he said it was a great idea but that the numbers would never work. I bumped into him about a year and a half, two years later and he asked me to revisit the idea. I found a company in Miami that had one coworking space at the time, Pipeline. We got the rights for Pipeline, and the Delaware Valley and ended up opening Pipeline Philly for $2M in 20K SF, which was my first real estate deal.
Bisnow: What was your first job in CRE?
Smith: I was basically the founder on the ground [at Pipeline Philly], the front-facing partner figuring out the first tenants, building out the business model, hiring the on-the-ground staff, etc. I was able to score the Knight Foundation as the anchor tenant and found some other strategic partners early, when we were still doing demolition — basically, building the plane while we were flying it.
Bisnow: What kind of education, certification or official training do you have in CRE? How critical was it to landing your first big role?
Smith: I do have an interest and a belief in progressive programming for entrepreneurs. But in my career trajectory, there haven’t been many programs that spoke to me as more of a doer rather than a theorizer.
To speak frankly, as an African American entrepreneur who has come from an undercapitalized position, most technical assistance or workforce development programs, for me, are trash. [They lack] cultural competency, lived experience and innovation. I've always learned best by going to a person that I have access to, who has lived experience, and is actually doing it. When I wanted to create a coworking space, I went to the person I knew who knew the most about real estate and that was David Grasso.
Bisnow: What is one skill you wish you had coming into CRE?
Smith: It's more like information or perspective than a skill. I've had to find my own mentors on my path to fiscal literacy — understanding the power of financial disclosures or that there is such a thing as good debt, how to do a sweat equity deal and knowing how to negotiate. There's just certain things that without lived experience or someone to say, “Hey, don't do it that way,” you can waste years, if not decades. Once you know certain things you're like, “Oh man, if I could have started out knowing that I would be light years ahead.”
Bisnow: What were you doing before you got into CRE?
Smith: I kind of consider myself to be a “hip-hop entrepreneur” because I started in the music business, and I don't necessarily feel like I need to be an expert in anything. It's more about trying to find partners who can pick up the ball when you're not necessarily strong in a certain area.
Bisnow: Can you remember a moment where you felt in over your head or you worried this industry wasn’t for you?
Smith: I have both the gift and the curse of a lot of confidence. And sometimes I have been guilty of not having fear when maybe I should have. But to be an entrepreneur, you’ve got to have a certain level of confidence or belief in your abilities, or the abilities of the people you partner with.
Bisnow: What were your early impressions of the industry, good and bad? How has your impression changed?
Smith: One night, I was working late at Pipeline and there was an event for commercial real estate brokers. I recognized a few people there, so I stayed and listened. At some point, I noticed that I was the only African American in the room. And I went up to a colleague of mine and I asked her how many Black commercial real estate developers she knew, and she said not many. And I asked the same question about Latinos, and she said none. I asked how many Asians, and she didn’t know any.
When I was younger, I didn't know what a commercial real estate broker was. And if you think about the fact that we are in what many would call a real estate renaissance in the city of Philadelphia, with more cranes in the sky than I've ever seen in my life, and you have 100 people in a room who all identify as White and they're talking about deal flow in a city that is 67% BIPOC, that is a thinly veneered apartheid system.
My naiveté is probably what drew me into commercial real estate, and my passion for and commitment to community is what led me to ask the questions that put me in spaces that would evolve into Pipeline, Smith & Roller, If Lab or The Collective.
Bisnow: What is a key lesson someone taught you, either kindly or the hard way?
Smith: I don't know who taught me this, but I would say my own observations that if I walk down 52nd Street, Germantown Avenue or Baltimore Avenue, I see that we no longer have control of our commercial corridors. They are undergirded by international capital or private equity, and that's why you find so many businesses that don't necessarily serve the community: dollar stores, check-cashing places, fast-food restaurants that don’t have a positive impact on health. There’s no one thinking holistically about the neighborhoods; people are just monetized. And I think there’s something structurally problematic about that.
Bisnow: So these international or private equity investors, you think they act like absentee owners who don’t invest in keeping their properties vibrant?
Smith: Oh, absolutely.
Bisnow: What do you warn people about when they join the industry?
Smith: I always warn people about being naive or being disengaged, either from bureaucracy, politics or your community. I wouldn't necessarily discourage anyone from getting into commercial real estate, but [I would say] don't get into anything without being aware of how structurally racist it is. Like, don’t go leading with your chin.
There's this constant, grand gaslighting that comes from the rhetoric of meaning well, optically or rhetorically, with no actual transformative change. Black and Brown entrepreneurs, women entrepreneurs, can be gaslighted to the point of exhaustion, or to the point that they actually lose faith, because of all the time that's taken up listening to and learning from institutions that aren't really trying to make change. They're just trying to get through the quarter and look better.
Bisnow: If you could do your career all over again, what would you change?
Smith: Nothing yet. I'm not one to dwell on regrets. Mistakes are the best lessons; take it as a loss, but then book it as a win because you're not going to make that mistake again.