Lyneir Richardson, a Chicago real estate investor, has a contract to buy the Walbrook Junction Shopping Center in West Baltimore for $6.2 million. He looked at 10 shopping centers before making an offer on Walbrook, lined up capital and arranged financing. The deal is scheduled to close at the end of March. Usually there would be nothing much to see here, folks, just another commercial real estate transaction in the city of Baltimore.
But Richardson wasn’t satisfied with that. As he put it the other night in a phone call, he could just write a check and the deal would be done. Merely acquiring property is not his goal.
His passion, he says, comes from “inclusive ownership,” getting more people — and other Black people, specifically — to have a stake in the real estate in their neighborhoods, and particularly in their shopping centers.
He’s on a mission to counter the disinvestment that has taken place in cities like his own and Baltimore.
So, last month, Richardson made an unusual pitch: For as little as $1,000, anyone over the age of 18 — hopefully residents of Walbrook Junction and nearby neighborhoods — could become part owners of the shopping center with him and his social enterprise, Chicago TREND. Richardson launched a crowdfunding page and hoped to raise maybe $35,000 as a first step.
As of Friday, TREND had raised $239,500 from 101 local investors, for an average investment of $2,371.
“I am not surprised,” Richardson says about the sum. “I am elated.”
If you’ve never heard of such a thing, join the club. Even for Richardson, whose enterprise was founded with grants from foundations and banks for the purpose of social impact in Black neighborhoods, this was a first.
TREND had purchased two other shopping centers in the Chicago area, both in neighborhoods where at least half of the residents were Black. But it was the Walbrook Junction property — and events of the past year — that got Richardson thinking about bringing on investors at the micro level.
He calls 2020 “a year of pandemic, protest and political pandemonium.” The civil unrest sparked by the death of George Floyd at the hands of Minneapolis police, along with the destruction of retail businesses in some cities, got Richardson to step up TREND’s targeted efforts at economic empowerment among people of color.
“The property damage and looting of stores made it palpable to TREND that Black residents do not own commercial property in their neighborhoods,” the narrative on the Walbrook crowdfunding page says. “Consequently, Black communities receive no financial benefit from the profitability and appreciation of shopping centers that they frequent as customers. Moreover, Black residents have few connections to visible and accessible Black shopping center owners.”
Richardson wanted to change that.
“When was the last time — think about it — that lower and middle income Baltimore residents, intentionally Black residents, were given an opportunity to own a shopping center?” he asks. “What if [neighbors] owned it and made the shopping center better over time? They will take pride in it, protect it and patronize the shopping center in a way maybe they wouldn’t if they didn’t have an ownership in it.”
Richardson says it was Paul Brophy, a veteran urban planner and former president of the Enterprise Foundation, who got him thinking about investing in Baltimore. Walbrook Junction, a few blocks west of Coppin State University, has been getting some redevelopment love in recent years. The shopping center, says Richardson, is stable and in good shape, with two anchor tenants, a supermarket and pharmacy, and other retail tenants who tend to renew their leases. The property produces steady revenue for its owner so, Richardson argues, the risk to investors is low.
“It’s not like you’re not going to make money,” he says. “This is not a donation. This is something we hope will be financially rewarding for people. [TREND] is not buying something we have to fix. This is buying something we don’t want to mess up, something we want to make better.”
Brophy has been watching as Richardson’s project unfolded over the last six weeks. He calls the crowdfunding by local investors a “breakthrough approach to transforming communities and building Black wealth.”
Richardson’s crowdfunding page went live on Jan. 12. He pitched it on social media and in a video. He conducted online chats with parents of children who attend a local charter school and a group of Black men interested in investments.
Richardson set the maximum crowdfunding goal at $335,000, and it looks like he could reach it. “If we don’t raise it all,” he says, “[TREND] will put the rest of the money in. It wasn’t like we had to have the money from local investors to make the deal happen. It was really about giving them the opportunity.”
He does not know yet how many of the 101 investors are from Walbrook Junction, but believes many are from Baltimore and all from Maryland.
“This is a theory,” he says, “that, if we create opportunity for local individuals to have an ownership stake, our communities will get stronger. That’s it. …
“We hope to find two or three other shopping centers in Baltimore that people can take pride in and, over time, by owning and by getting financial rewards, the community’s going to get stronger. Baltimore will be a national model of what inclusive ownership of a shopping center can be.”