Partnerships Hold Immense Power in Redeveloping Cities
By Ian Wiesner, Director, Business Development
Community Development Financial Institutions (CDFIs) have been bringing investment to Detroit for more than two decades. The mission-driven approach and unique tools that CDFIs bring to the market have played a critical role in the development of new housing and community facilities like grocery stores and schools in the city.
But in order to scale our work to have a broader impact, it is vital to have mission-aligned partners who can help us generate the capital we need to make these investments for Detroiters. JPMorgan Chase is one of those partners, working with local organizations that know the Detroit landscape and are connected directly to the city’s communities.
As was noted on the fifth anniversary of their $100 million pledge, JPMorgan Chase brought their philanthropic efforts into Detroit a few years after the economic recession. More than just a large investment, this commitment illustrated how thoughtful work with others who deeply care about the city’s success – from nonprofit organizations to local businesses and emerging entrepreneurs – can facilitate real change. The organization had a clear vision from the start: to expand efforts by working closely with CDFIs. This investment reflected an opportunity for large investors, foundations, and philanthropic organizations to engage with nonprofits like Capital Impact for social change.
How can banks like JPMorgan Chase work with community organizations to revitalize a city?
When JPMorgan Chase announced its five-year plan, which originally consisted of a $100 million dollar investment in Detroit’s economic recovery, its initial goals were to work with local organizations that knew the city best to transform neighborhoods, grow small businesses, and bring back former residents.
In order to make these goals possible, the bank planned to provide loans and grant capital to help strengthen organizational capacity of both Invest Detroit and Capital Impact Partners – CDFIs helping people build communities of opportunity that break barriers to success.
JPMorgan Chase selected Invest Detroit and Capital Impact Partners because we are proven local partners with deep expertise in Detroit. With JPMorgan Chase’s flexible, long-term capital, organizations like ours have been able to amplify our investments in numerous community development projects across Detroit’s key residential and commercial corridors with a focus on mixed-used, mixed-income housing that supports inclusive growth for all Detroiters.
Additionally, Chase’s investments were designed to allow both CDFIs to grow in a sustainable and scalable manner, enhancing their ability to attract future investment and have even broader economic impact for decades.
What difference has the investment made?
Together, we have strongly advocated for a combination of affordable and market-rate housing, both of which are in high demand – and are critical elements of revitalizing communities.
A key element of this approach was Capital Impact Partners using its funding from Chase to create the Detroit Neighborhoods Fund. The $30 million Fund deployed flexible capital to local developers who shared our vision of both preserving and growing mixed-use and multifamily housing developments across Detroit. For our part, Capital Impact put an additional $10 million of our own money into the Fund.
Several housing developments have been built because of this partnership. These projects include:
- The Coe at West Village
- Plaza Midtown
- The Garland in West Village
- The Scott at Brush Park
- Granada Apartments
- Siegel Detroit
- Kercheval Village
Beyond financing, Capital Impact also worked with Chase to introduce the Equitable Development Initiative. This initiative provides training and mentorship to better ensure that Detroit’s pool of real estate developers reflects the city’s diversity and that minority real estate developers are able to participate in the revitalization efforts currently taking place in the city. The program has been in place for two years and has given 47 participants of color the resources needed to move their development careers forward.
Why Partnerships Matter
The recent investment across Detroit has not occurred by accident, it is the result of the commitment of numerous partners, including residents, community organizations, and local businesses. These partners invested time and capital to re-energize the city. This work has created corridors of opportunity that have helped residents live close to jobs, services, and transit, and more importantly, take advantage of the amenities that come with the city’s revitalization.
Through the partnership of banks and CDFIs, Detroit’s future continues to look bright, and the momentum that has been built will continue moving this great city forward.