Why Equitable Development Matters for Businesses and Communities
The ongoing demands for racial equity and social justice have touched practically every facet of business, including the real estate and architecture industries where leaders are calling for more equitable development.
As part of this momentous change, and in celebration of Black History Month, the virtual HKS Limitless series recently brought together several real estate, design and development leaders to discuss ideas about the future of community inclusion and representation in building projects.
First, Don Peebles, Founder, Chairman and Chief Executive Officer of Peebles Corporation, joined HKS Principal and Regional Director, Scott Hunter, for a conversation about the state of real estate development in America today. Peebles, who leads one of the largest Black-owned real estate investment and development companies in the country, said the industry has traditionally denied opportunity to marginalized populations. His company focuses on flattening those ingrained structural barriers.
Peebles Corporation, which awards at least 35% of its contracts to minority and women owned businesses, recently launched a real estate fund to invest in businesses with diverse leadership, an endeavor that may set an example for other companies that wish to overcome inequities in real estate development.
“I believe that business has an important, critical role to play in closing these disparities,” Peebles said.
He added that as social justice protests and a global pandemic have brought companies’ practices into focus over the last year, he believes a shift is underway.
“Now that people are engaged, I think we’re going to see much more accelerated change,” Peebles said.
Defining Equitable Development
To dig deeper into how that change can take place, HKS assembled a separate panel of experts including Damien Goodmon of Downtown Crenshaw Rising; Donahue Peebles (Don Peebles’ son) of The Peebles Corporation; Juanita Hardy of Tiger Management Consulting Group; and Miles Cooley of CMNTY Culture.
HKS moderated the panel as the group discussed how they define equitable development — something they have pushed for as business leaders and activists throughout their careers.
Cooley, whose organization’s development arm is working to provide opportunities to Black and Brown entertainers in Los Angeles, believes intentionality when soliciting input on a project is key.
“From a wholistic perspective, it has to do with bringing the community to the table right away in a true sense,” he said.
Focusing on the systematic roadblocks to community inclusion is a starting point to making authentic equitable development possible. To Goodmon, the metric is about strengthening communities.
“Are we leaving traditionally marginalized communities healthier, cleaner and more prosperous than they were before?,” asked Goodmon, who was lauded by fellow panelists for his advocacy and development efforts in the historically Black Los Angeles neighborhood of Crenshaw.
Emphasizing the necessity of buy-in from a broad range of stakeholders, from legislators to business leaders, Hardy and Donahue Peebles stressed the need for policies and programs that promote and incentivize engagement and support long-term sustainability.
“Developers need to see community not as an obstacle, but as a partner,” Peebles said, adding that financial institutions also have a big part to play — and should be held accountable — in community development efforts.
Hardy, a former Urban Land Institute Senior Visiting Fellow for Creative Placemaking, believes that equitable practices should be integral parts of all real estate development projects, not just those in underserved communities. And along with the other panelists, she believes there is a value proposition in increasing representation at all stages of the development process.
Increasing Diversity in Ownership
As cities grow, existing communities — particularly communities of color — are often pushed aside in favor of new developments such as luxury housing or big box retail establishments. The panelists described one major obstacle preventing fair distribution of wealth and resources in communities of color: the scarcity of Black and Brown leaders in real estate development and ownership.
Donahue Peebles, a Development Executive at his father’s company, believes that minorities are not often given opportunities to play integral roles in leading or owning projects.
“Improving the equity ownership and building wealth in the Black community is essential to resolving that asymmetry in power,” Peebles said.
The panelists agreed that having more diverse and locally rooted building owners can lead to long-term economic and social prosperity. Cooley said that developers will be better able to “inculcate the values” of equitable development by bringing more Black and Brown people to the table.
Goodmon shared that he believes there’s more to successful equitable development than a diverse demographic make-up of stakeholders. He said that people involved in development projects must be driven by a common belief that the bottom line isn’t the most important thing and make choices that put the community first.
“Ultimately, those decisions are character decisions, not color decisions,” he said.
The panelists noted that the responsibility to improve development processes falls on everyone involved— investors, developers, owners, governments and designers — and they all must work together to enhance society’s understanding of the importance of equity and inclusion in building projects.
“Part of the work we have at hand is educating, raising awareness and helping people understand why this makes sense,” Hardy said.
The panelists also discussed a paradox of modern development in cities, agreeing that while new resources and centers of business can enhance communities, the way they are executed and marketed can harm existing populations. The term ‘cultural vibrancy,’ in particular, is a phrase that Donahue Peebles hears used by developers who pick and choose local assets in a community to emphasize, that they believe will give them the best return on investment for projects like new multifamily housing.
He believes developers should, instead, celebrate all aspects of local culture and support the needs of those who currently live there, too, because “the goal is to uplift those who are already in the community.”
Hardy said she doesn’t believe gentrification is necessarily a bad thing, but to avoid displacement that often comes as a result of gentrification, she said developers should preserve what pre-exists in a community and invest in assets long-term.
Goodmon says that he prefers to use terms such as ‘cultural erasure’ and ‘displacement’ instead of ‘gentrification’ to effectively communicate the stakes of inequitable development.
“You cannot take a community of… marginalized people and remake it for an affluent community and not challenge cultural integrity,” he said.
The panelists shared a common ideology that the future of development should be more about people than about money because, as Donahue Peebles noted, the sense of community is often grounded in the buildings within that community — the places where people live, work and socialize.
“We have a responsibility to create projects that are judged…on their ability to repay the debt they owe to the community,” he said.