Terri Ludwig’s Drive to End Housing Insecurity

By Samantha Goldberg

Growing up in a small southern Illinois town, Terri Ludwig learned the value of community at an early age. Her mother, a seventh-grade science teacher, taught her the importance of giving back and helping ensure everyone has a chance to succeed. While an inherited knack for math and science initially prompted Ludwig to study engineering at the University of Illinois at Urbana-Champaign, her interest in human outcomes led her to graduate in 1985 with a degree in industrial psychology. That combination of technical and people skills came in handy when she was subsequently chosen for a training program at Merrill Lynch, leaving her small-town comforts for bustling New York City and launching a 12-year career on Wall Street.

Despite building a lucrative career in finance, however, Ludwig ultimately felt that something was missing. Looking to apply her financial skills in a more meaningful way, she quit her job in 1996 and earned a master’s degree from Harvard’s Kennedy School of Government. Since then, Ludwig has held positions in microfinance and community development, before landing a role in 2009 as executive vice president & COO of Enterprise Community Partners, a nonprofit that works with partners to finance, build and advocate for affordable housing. Promoted to president & CEO just two years later, Terri has not only expanded the company’s core businesses over the past seven years but has united 1,000-plus team members under one mission: creating communities of opportunity for low- and moderate-income residents.

“Twenty million households are meaningfully housing-insecure—paying at least 50 percent of their income on housing—and 11 million of those households are renters,” Ludwig noted. “Our vision is the day that families have stable housing and connections to opportunity.”

Paving a path

Ludwig’s initial move to Manhattan by herself was daunting, but she knew the chance to partake of Merrill Lynch’s 15-month training program was invaluable.

“I knew no one and had no family there. … It was truly a leap of faith that this was going to be an opportunity to learn and grow for me,” Ludwig recalled. She learned the ins and outs of capital markets, and gained experience in everything from investment banking and underwriting to retail sales and government relations.

After the program, Ludwig moved into a structured finance role, advising large institutional clients on optimizing their portfolios. Working on an international account primarily focused on fixed-income securities, Ludwig wanted to learn more about international capital markets, and eventually moved to the foreign currency area. “I didn’t know anything about foreign currency … but I became a very fast learner,” Ludwig said. She eventually developed her own expertise, advising mutual funds, hedge funds and central banks on their foreign currency strategies.

Credit Suisse recruited her in 1993 to be a director of global foreign exchange. In that role, Ludwig gained an understanding of emerging markets by traveling overseas, a part of the job that proved to be a turning point.

“Seeing the extreme poverty and inequality really shook me to my core,” she said. “With so much wealth, it was hard for me to understand how we could let so much poverty exist. I knew from my upbringing that my mission was always to serve in a different way.”

In 1996, Ludwig left her successful finance career behind and headed to Harvard for a master’s degree in public administration, non-profit management and international development. During one of her classes, Terri met the CEO of ACCION, a global nonprofit specializing in microfinance. Ludwig worked on a project for the firm, and after graduating was recruited to serve as CEO of ACCION NY, an early leader in the U.S. microfinance movement.

Providing affordable small business loans to entrepreneurs, Ludwig saw how “as little as $500 could make an incredible difference in a low-income family’s life.” In that way, the transactions were far more impactful than the multibillion-dollar transactions in foreign currency she had once overseen. This made it all the more difficult when tragedy struck on Sept. 11, 2001.

“It was very confronting,” Ludwig recalled, noting that many of the small businesses ACCION worked with operated around Ground Zero. Within a few weeks, Ludwig assembled her team and went to the site to support entrepreneurs in need, listening to their stories and determining what capital was necessary to get them back on their feet. Her connection to the area motivated her to move to Battery Park in 2002 and help rebuild the community.

Later that year, Ludwig returned to Merrill Lynch as president & CEO of a new entity, Merrill Lynch Community Development Co. Ludwig led the firm’s commercial and multifamily lending and investment program, as well as its global microfinance efforts. She also took part in an initiative to get more involved in affordable housing and small business development in underserved markets.

“One of the things we realized was you can’t just focus on housing, you need to focus on community, and she helped us think that through,” recollected Claudia Kahn, who led the initiative as Merrill Lynch’s senior vice president of public policy and corporate responsibility before retiring in 2008. “She’s an incredibly intelligent, thoughtful and creative executive who can really be part of developing innovative strategies to address areas that need attention.”

Enterprising initiatives

Ludwig’s role at Merrill Lynch also involved partnering with public and private entities, including one that particularly stood out: Enterprise Community Partners.

“I was really attracted to Enterprise because they were my go-to partner and they did a lot of housing, but they also understood the broader opportunity set in communities for change,” she noted. Enterprise’s leadership was also taking note of Ludwig’s work.

“She had gotten some across-the-board great reviews in terms of her work and leadership at ACCION, and (for) her creativity and commitment,” recalled Bill Frey, who joined Enterprise as the first director of its New York office in 1987 and is now senior director of preservation. “She brought not just her financial acumen but also a unique way of connection and compassion for what was being done in community development.”

When Frey and then-President & CEO Doris Koo asked Ludwig to come on board as executive vice president & COO in late 2009, the decision to accept the offer was a “no-brainer,” she recalled.

Taking on the role right after the financial crisis, Ludwig immediately got started on ensuring the company’s financial strength, with a focus on growing the firm’s impact and revenue base. Ludwig worked with Frey on creating the “one Enterprise” concept, which united the three core parts of Enterprise’s business: delivering capital, developing programs and advocating for policies, all to create and preserve affordable housing.

On the capital side, Ludwig partnered with Charles Werhane, president & CEO of subsidiary Enterprise Community Investment Inc., to increase the company’s capital allocation through public-private partnerships. Enterprise has expanded its investment in communities from $1 billion in 2011 to more than $7 billion in 2017.

Ludwig’s early success convinced Ronald Terwilliger, the former CEO of Trammell Crow Residential and chair of Enterprise Community Partners, that she was a fit for the company’s top job when Koo returned to the West Coast in 2011. “It became very clear to me that she had the credentials and capability to be the CEO,” he recollected.

Ludwig has gone on to lead several major acquisitions, including the 2012 merger of Enterprise’s multifamily mortgage finance business with Bellwether Real Estate Capital to form Bellwether Enterprise. The unit netted more than $6 billion of Enterprise’s total 2017 investments.

She has also been instrumental in the growth of the Enterprise Homes affiliate, a nonprofit affordable housing developer. Initially focused on rehabilitating and preserving affordable housing in the Washington, D.C., area, the firm has taken on ownership and property management roles in the last few years, Terwilliger noted.

In August 2017, Enterprise Homes acquired a 4,153-unit Mid-Atlantic portfolio from The Shelter Group, tripling its number of owned properties and adding 175 employees. In January 2018, Enterprise Community Investment combined with multifamily owner Community Preservation and Development Corp. (CPDC), which is set to expand Enterprise’s resident services and preserve the affordability of 12,000 units in the Mid-Atlantic region.

Impact in action

Enhancing the capital side of the business has helped Ludwig expand the firm’s programmatic and policy work, with an emphasis on data and technology to create better solutions. Enterprise recently launched Opportunity360, a platform that allows users to see how any Census tract ranks on key opportunity measures, such as affordable housing, education, and access to jobs, transportation and healthy foods.

On the policy front, Ludwig has been advocating for more resources at the federal, state and local levels to address housing insecurity. She has “really played that policy role in terms of bringing some education and understanding to folks on the Hill, as well as in various cities,” Frey said. “There really is an engagement with her, because of her energy and understanding of what is happening around the country and what can happen with some best practices.”

The company has also been focused on how housing security and stability drives health and educational outcomes, partnering with organizations in those fields on policy initiatives and programs. “These problems are interconnected, so our solutions have to be, too,” Ludwig proclaimed.

Among all her responsibilities at Enterprise, Ludwig finds particular joy in traveling around the country to the firm’s 10 regional offices, as well as to individual communities, to see the company’s work on the ground. Frey recalled a recent tour Ludwig led with HUD employees to see Enterprise’s housing and community building efforts in the Bronx. In order to demonstrate the significance of Enterprise’s work, Ludwig let residents share their stories with tour participants.

“What is extremely rare nowadays is for people to take the time to listen and take what you’ve listened to and transfer that into what becomes part of our work,” Frey said.

As Ludwig enters her eighth year at the helm of Enterprise, her main goals include driving more investment capital by bringing on “impact investors,” expanding sustainability efforts, and determining how technology can transform the firm’s work. But the ultimate objective is for the firm’s efforts to reach what she calls “population-level outcomes.”

“We’ve put out almost $30 billion in capital, partnered with some 2,500 community groups across the U.S.; we’ve achieved some incredible milestones, but at the same time, we’re confronted by the scale of the issues,” she said. “We have a unique place to play in this market to bring not only the capital functions but also how does that connect with our programmatic work … and how do we put that into our policy work so we can really accelerate our impact to improve the lives of low-income people nationwide.”

Photos by Michael Schoenfeld, Courtesy of Enterprise Community Partners.

Read more about Terri Ludwig in the March 2018 issue of MHN.