‘Things remain very much business as usual within real estate’: a Black-run Manhattan skyscraper hits a roadblock
A new New York City skyscraper designed by a white architect, built by a white contractor and developed by a white real estate company? Business as usual. But what about a new New York City skyscraper designed by a Black architect, built by a Black contractor and developed by a Black real estate company? Now you’re paying attention.
Which is why the proposal for the 90-story Affirmation Tower is both so audacious – and long overdue.
Set on a 1.2-acre plot along Manhattan’s far West Side, across the street from the Jacob K Javits convention center, the skyscraper was designed like a delicately cantilevered, gravity-defying stack of building blocks, skinny on the bottom and wider up top. Envisioned as a home for some of the nation’s top Black-owned businesses, the Affirmation Tower would be ambitious for a real estate leader of any race, let alone Don Peebles , the Florida- and New York-based businessman considered by many to be the most accomplished African American property developer in the nation. “The time for this project is long overdue,” says Peebles, whose all-Black supporting cast includes the Anglo-Ghanaian architect David Adjaye for its design along with the McKissack Group , the century-old Black- and woman-owned construction management firm to oversee its construction. “New York is a city filled with monumental towers but not one of them is designed by a Black architect with a Black development team and a Black builder,” says Peebles. “This is my way to address these inequities.” The time for this project is long overdue Developer Don Peebles While the scale of the Affirmation Tower, a super-tall structure that would put most skyscrapers to shame, may appear outsized, the challenges Peebles faces – and his hopes that the Affirmation Tower will ultimately become New York’s tallest building – are shared by Black developers at every level. Indeed, nearly three years after the murder of George Floyd – which saw US corporations of all stripes publicly commit to investing in racial equity initiatives including property development – the $20tn US real estate industry remains almost entirely devoid of African American participation.
Despite a handful of high-profile Black-led projects – including a $3.8bn lakefront Chicago development and a 109-acre redevelopment scheme for Philadelphia’s navy yard – only 2% of US real estate firms , according to Enterprise Community Partners , are run by African Americans. (In addition to Peebles, another key player is Greg Reaves , whose 15-year-old firm, Mosaic Development Partners, is behind that billion-dollar Philadelphia project.) Urban Land Institute , a nonprofit that advocates for urban development and growth, reports that just 5% of its total members are Black.
“This is a very difficult industry to be part of without wealth or capital, and the Black community doesn’t traditionally come to the table with large amounts of either,” says Reaves, a former pharmaceutical executive whose firm is focused on correcting racial and gender inequities within the commercial real estate sector. Even after the outpouring of industry support that followed the George Floyd killing, and the fashion for buying – and supporting – black, “things remain very much business as usual within real estate,” Reaves says. “And this means an industry with [overwhelmingly white] institutional players and legacy businesses hoping to grow those family legacies.” Don Peebles, the developer behind the Affirmation Tower, says it ‘will serve as an economic engine for all of New York’. African Americans’ historic lack of capital has implications at every level of the Black real estate community. According to Peebles, the Affirmation Tower, which will cost $3.5bn (£2.9bn) to build, came to market with ample prefunding to get the project completed – an immense achievement for a developer of any race for a project of this scale. But with adequate access to capital far more the exception than the rule for Black developers, securing early-stage financing for even the most modestly sized Black-led projects can feel equally monumental.
Curtis Doucette, CEO of New Orleans-based Iris Development , says the intersections of race and economics are felt throughout the development cycle. Whereas other independent developers might be able to tap extended family networks for startup cash, “people in my circle may believe in me but lack the money to invest in me”. Once funding has been secured, discriminatory race-based appraisal practices can undervalue completed developments, which make it harder for builders to secure funding for subsequent projects. “At every stage of the game, there are efforts to prevent opportunity,” says Doucette.
This lack of opportunity doesn’t just affect Black developers. As Peebles’s Affirmation Tower, which still awaits a green light, illustrates, Black entrepreneurs are more likely to hire Black partners, and often build in their own communities. Developers of color also skew in favor of affordable housing, often because they’re supported by various public- and private-sector initiatives. The correlation is so great that some minority developers worry that operating mostly in the affordable housing arena may stigmatize their firms and stand in the way of their seeing profit. We are finally seeing capital investment concerned with both impact as well as returns Brian McLaughlin of Enterprise Community Development Nonetheless, as it supports entrepreneurs who actually look like their target communities, investment in Black developers has the potential to “shape a neighborhood so that it can stand up on its own”, says Baltimore-based Brian McLaughlin, president of the national nonprofit housing owner and developer Enterprise Community Development. And in the wake of George Floyd, he adds: “We are finally seeing capital investment concerned with both impact as well as returns.”
Indeed, both major financial institutions and specialized, equity-focused firms have developed investment programs that especially target Black developers. Citibank, for instance, has committed $200m to fund affordable housing programs led (or mostly led) by minority developers as part of its far-larger billion-dollar Action for Racial Equity initiative, which was announced just after the George Floyd protests. There is also a $3.5bn program run by Enterprise Community Partners to support developers of color who are focused on affordable housing. Capital Impact Partners (CIP) launched a $20m fund in 2021 to support Washington DC-based developers of color, such as Thomas Houston, who’s transforming a vacant lot in DC’s economically challenged Ward 7 into the 31,530 sq ft mixed-use facility Deanwood Station. When completed, the structure will include 26 affordable condos along with a pair of Bipoc-owned businesses, a much-needed grocery store and a juice bar and cafe.
Helping young developers like Houston secure their first win is of particular importance for CIP, which has not only launched startup funds, but also a range of fellowships and initiatives to educate and support young developers of color. In this industry, “there is a lot of focus on track records”, particularly as it relates to a young developer’s ability to “scale upwards”, says Jeff Mosley, CPI’s director of national equitable development initiatives. “We are helping to demonstrate that there’s a path for these young developers to achieve and execute given the right support.” We are helping to demonstrate that there’s a path for these young developers to achieve and execute given the right support Jeff Mosley of Capital Impact Partners Beyond institutional financing, Black developers are also securing support from white investors. Reaves’s Mosaic Partners, for instance, recently saw a $10m investment from billionaire Josh Harris , cofounder of Apollo Global Management and owner of the Philadelphia 76ers basketball team. Reaves describes the Harris investment as “critical and crucial” for the long-term growth of Mosaic, whose projects have created more than 200 construction jobs over the past 15 years.
In New York, Peebles’s Affirmation Tower has spent the past year in regulatory limbo after Governor Kathy Hochul’s decision last year to reconsider the site’s long-term fate. Initially, under then governor Andrew Cuomo , calls were put out to develop the site with the type of commercial and hotel tenants Peebles planned for Affirmation Tower. But after Cuomo’s resignation in mid-2021, his successor faced pressure from activists to introduce affordable housing into the tower’s design, which was not part of the original plan for the project. Peebles, who has built thousands of affordable units throughout his career, finds this snag irksome for a commercial tower that was never intended to include housing of any type.
“This is often where they think we belong, in the affordable housing space,” says Peebles. “But Affirmation Tower will serve as an economic engine for all of New York.” Peebles remains in a holding pattern, waiting for Hochul to restart the bidding process for the Affirmation Tower’s proposed sites. In the meantime, Peebles insists that the project would not just salute the Black design and development talent behind it – it would also provide a permanent home for the New York headquarters of the NAACP, a national civil rights museum and myriad offices for major Black businesses. “This is the type of economic inclusion the state should truly be encouraging,” he says.
This article was amended on 24 February 2023 to reflect that Enterprise Community Development is a nonprofit housing owner and developer, not a lender.
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‘Things remain very much business as usual within real estate’: a Black-run Manhattan skyscraper hits a roadblock
A new New York City skyscraper designed by a white architect, built by a white contractor and developed by a white real estate company? Business as usual. But what about a new New York City skyscraper designed by a Black architect, built by a Black contractor and developed by a Black real estate company? Now you’re paying attention.
Which is why the proposal for the 90-story Affirmation Tower is both so audacious – and long overdue.
Set on a 1.2-acre plot along Manhattan’s far West Side, across the street from the Jacob K Javits convention center, the skyscraper was designed like a delicately cantilevered, gravity-defying stack of building blocks, skinny on the bottom and wider up top. Envisioned as a home for some of the nation’s top Black-owned businesses, the Affirmation Tower would be ambitious for a real estate leader of any race, let alone Don Peebles, the Florida- and New York-based businessman considered by many to be the most accomplished African American property developer in the nation. “The time for this project is long overdue,” says Peebles, whose all-Black supporting cast includes the Anglo-Ghanaian architect David Adjaye for its design along with the McKissack Group, the century-old Black- and woman-owned construction management firm to oversee its construction. “New York is a city filled with monumental towers but not one of them is designed by a Black architect with a Black development team and a Black builder,” says Peebles. “This is my way to address these inequities.”
While the scale of the Affirmation Tower, a super-tall structure that would put most skyscrapers to shame, may appear outsized, the challenges Peebles faces – and his hopes that the Affirmation Tower will ultimately become New York’s tallest building – are shared by Black developers at every level. Indeed, nearly three years after the murder of George Floyd – which saw US corporations of all stripes publicly commit to investing in racial equity initiatives including property development – the $20tn US real estate industry remains almost entirely devoid of African American participation.
Despite a handful of high-profile Black-led projects – including a $3.8bn lakefront Chicago development and a 109-acre redevelopment scheme for Philadelphia’s navy yard – only 2% of US real estate firms, according to Enterprise Community Partners, are run by African Americans. (In addition to Peebles, another key player is Greg Reaves, whose 15-year-old firm, Mosaic Development Partners, is behind that billion-dollar Philadelphia project.) Urban Land Institute, a nonprofit that advocates for urban development and growth, reports that just 5% of its total members are Black.
“This is a very difficult industry to be part of without wealth or capital, and the Black community doesn’t traditionally come to the table with large amounts of either,” says Reaves, a former pharmaceutical executive whose firm is focused on correcting racial and gender inequities within the commercial real estate sector. Even after the outpouring of industry support that followed the George Floyd killing, and the fashion for buying – and supporting – black, “things remain very much business as usual within real estate,” Reaves says. “And this means an industry with [overwhelmingly white] institutional players and legacy businesses hoping to grow those family legacies.”
African Americans’ historic lack of capital has implications at every level of the Black real estate community. According to Peebles, the Affirmation Tower, which will cost $3.5bn (£2.9bn) to build, came to market with ample prefunding to get the project completed – an immense achievement for a developer of any race for a project of this scale. But with adequate access to capital far more the exception than the rule for Black developers, securing early-stage financing for even the most modestly sized Black-led projects can feel equally monumental.
Curtis Doucette, CEO of New Orleans-based Iris Development, says the intersections of race and economics are felt throughout the development cycle. Whereas other independent developers might be able to tap extended family networks for startup cash, “people in my circle may believe in me but lack the money to invest in me”. Once funding has been secured, discriminatory race-based appraisal practices can undervalue completed developments, which make it harder for builders to secure funding for subsequent projects. “At every stage of the game, there are efforts to prevent opportunity,” says Doucette.
This lack of opportunity doesn’t just affect Black developers. As Peebles’s Affirmation Tower, which still awaits a green light, illustrates, Black entrepreneurs are more likely to hire Black partners, and often build in their own communities. Developers of color also skew in favor of affordable housing, often because they’re supported by various public- and private-sector initiatives. The correlation is so great that some minority developers worry that operating mostly in the affordable housing arena may stigmatize their firms and stand in the way of their seeing profit.
Nonetheless, as it supports entrepreneurs who actually look like their target communities, investment in Black developers has the potential to “shape a neighborhood so that it can stand up on its own”, says Baltimore-based Brian McLaughlin, president of the national nonprofit housing owner and developer Enterprise Community Development. And in the wake of George Floyd, he adds: “We are finally seeing capital investment concerned with both impact as well as returns.”
Indeed, both major financial institutions and specialized, equity-focused firms have developed investment programs that especially target Black developers. Citibank, for instance, has committed $200m to fund affordable housing programs led (or mostly led) by minority developers as part of its far-larger billion-dollar Action for Racial Equity initiative, which was announced just after the George Floyd protests. There is also a $3.5bn program run by Enterprise Community Partners to support developers of color who are focused on affordable housing. Capital Impact Partners (CIP) launched a $20m fund in 2021 to support Washington DC-based developers of color, such as Thomas Houston, who’s transforming a vacant lot in DC’s economically challenged Ward 7 into the 31,530 sq ft mixed-use facility Deanwood Station. When completed, the structure will include 26 affordable condos along with a pair of Bipoc-owned businesses, a much-needed grocery store and a juice bar and cafe.
Helping young developers like Houston secure their first win is of particular importance for CIP, which has not only launched startup funds, but also a range of fellowships and initiatives to educate and support young developers of color. In this industry, “there is a lot of focus on track records”, particularly as it relates to a young developer’s ability to “scale upwards”, says Jeff Mosley, CPI’s director of national equitable development initiatives. “We are helping to demonstrate that there’s a path for these young developers to achieve and execute given the right support.”
Beyond institutional financing, Black developers are also securing support from white investors. Reaves’s Mosaic Partners, for instance, recently saw a $10m investment from billionaire Josh Harris, cofounder of Apollo Global Management and owner of the Philadelphia 76ers basketball team. Reaves describes the Harris investment as “critical and crucial” for the long-term growth of Mosaic, whose projects have created more than 200 construction jobs over the past 15 years.
In New York, Peebles’s Affirmation Tower has spent the past year in regulatory limbo after Governor Kathy Hochul’s decision last year to reconsider the site’s long-term fate. Initially, under then governor Andrew Cuomo, calls were put out to develop the site with the type of commercial and hotel tenants Peebles planned for Affirmation Tower. But after Cuomo’s resignation in mid-2021, his successor faced pressure from activists to introduce affordable housing into the tower’s design, which was not part of the original plan for the project. Peebles, who has built thousands of affordable units throughout his career, finds this snag irksome for a commercial tower that was never intended to include housing of any type.
“This is often where they think we belong, in the affordable housing space,” says Peebles. “But Affirmation Tower will serve as an economic engine for all of New York.” Peebles remains in a holding pattern, waiting for Hochul to restart the bidding process for the Affirmation Tower’s proposed sites. In the meantime, Peebles insists that the project would not just salute the Black design and development talent behind it – it would also provide a permanent home for the New York headquarters of the NAACP, a national civil rights museum and myriad offices for major Black businesses. “This is the type of economic inclusion the state should truly be encouraging,” he says.
This article was amended on 24 February 2023 to reflect that Enterprise Community Development is a nonprofit housing owner and developer, not a lender.
