IT TAKES A DECADE TO SUCCEED - GET TO KNOW YOUR OZ PARTNER
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Investors should partner with sincerity from the outset . Go speak with the people who live there and you may find plenty of people who are skeptical of any change at all , and fear it may displace them . Keep in mind , they have reason to be skeptical , as a great number of OZs face challenges that are the direct result of policy decisions made in the past . Let people know how your project will be helpful to them . Let them know you ’ re here for the long term , and your success is tied to the success of the people in the neighborhood . It ’ s in your business interest to be well-engaged . Share your diligence and your findings , and consider bringing a local community development partner onto your team with the mindset that you can learn from them , while building trust , which will help the project in the long-term .
You ’ re working in an area where the impacts ( both positive and negative ) of your project may be outsized compared to markets where investment is more frequent . Be candid about what is needed to make a project work , and forthright about your long-term commitment and the value you can add . View your project as one piece of the overall plan to improve the economic prosperity , and the lives , of people living and working in the neighborhood .
WHAT SHOULD LOCAL LEADERS UNDERSTAND ABOUT INVESTOR PRIORITIES TO HELP ATTRACT AND SUPPORT THEIR PROJECTS ?
First and foremost , investors are seeking return on investment . There are a lot of deals out there in a lot of communities , and OZs alone don ’ t turn bad deals into good ones . we ’ re all trying to accomplish , which by the way is one of the top recommendations from marriage experts across the nation .
WHAT SHOULD OZ INVESTORS UNDERSTAND ABOUT INVESTING IN HISTORICALLY UNDERSERVED COMMUNITIES ?
First and foremost , investors and developers need to recognize that this is a ten-year project , and more than that , a ten year partnership . You ’ re investing in a neighborhood , so you ’ ve got to believe in the neighborhood ’ s potential , and focus on the value you can bring to it over time . It ’ s not enough to simply look at your site , your projected IRR , and your cap rate as you might a three or five year hold . Take note of what ’ s happening in the neighborhood today , recognize what has gotten the neighborhood through downturns in the past , and most importantly , be sure you ’ re fully bought-in to the community ’ s vision for growth and change for the coming decade .
Recognize that with only a few exceptions , you ’ re investing in a community that has been off the radar of institutional capital for generations . The first responsibility of OZ investors is “ humility .” It ’ s vital to remember that your project isn ’ t going to save the community , nor are you the savior . Instead , see your role as a partner who is bringing resources , expertise , and of course , capital , to partner with existing residents and stakeholders .
Savvy investors are looking to partner with local leaders who understand and are focused on helping to reduce project risk .
Savvy investors are looking to partner with local leaders who understand and are focused on helping to reduce project risk . In the early stage , leaders should have a plan to help clear the hurdles necessary to get new business and real estate projects approved and underway quickly . Local leaders should consider sitting down with investors and developers to gain an understanding of what ’ s possible before doing community input , because it ’ s very possible that what investors are able to do won ’ t line up with the community ’ s wish list .
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