Real Estate Gives Back: Linking Housing Help With Jobs
Workforce and market-rate investor Chris Finlay has created a homeless assistance program that he considers a sustainable way forward.
Middleburg Real Estate Partners CEO Chris Finlay considers himself an unlikely do-gooder. The self-proclaimed “profit-oriented real estate guy” launched his Virginia-based investment, development and management firm in 2004 to buy and manage workforce and middle-market apartments from a fiscal standpoint. Then five years ago, he read an article about situational homelessness, which occurs when a person faces some sort of loss crisis related to housing, financial, or employment, and his eyes were “sewn open.”
“I read that article and for some reason felt compelled to act,” Finlay recalled. He acted by founding Shelter to Shutters, a 501c3 organization that transitions individual people and families out of homelessness to economic self-sufficiency by engaging the apartment industry to help provide jobs and housing.
Through the program, real estate companies provide rent concessions to participants who are trained for entry-level apartment management positions, which typically have a turnover rate of about 50 percent compared to about 7 percent through the Shelter to Shutters program.
In exchange for about a year of rent concessions, not atypical in the industry, Finlay points out that real estate companies get something that’s worth far more: a loyal, dedicated employee who is more focused on career than a job, creating less turnover. “That longevity and that motivation really adds tremendous value to the real estate company and the property,” he explained.
The results are impressive to date: 260 people lifted out of homelessness with 87 percent annual employee retention rate for participants, 89 percent receiving wage increases or promotions, and a 93 percent success rate of participants not re-entering homeless services.
“My focus is going to be helping other people,” Finlay said. “But I migrated to this understanding over time—the more we do, the better we do. It’s recognizing this co-dependence on community engagement and financial performance and how these things are not mutually exclusive, or rather, intertwined.”
Paying It Foward
This business approach is one that Finlay believes is a “sustainable way forward” versus straight philanthropy. Finlay, who serves on the board of the National Multi-Housing Council, says the organization under Doug Bibby’s leadership, has been good about recognizing the challenges of housing affordability, particularly in launching the Housing Affordability Toolkit in May this year to help guide discussions regarding specific housing affordability policies, tools, and incentives.
“What I think we’ll see in the real estate industry–and business in general–is an ongoing recognition that we can work together, that it is not a zero-sum game, and that we can continue to collectively innovate ideas, share those ideas, and make it better for everybody involved,” Finlay says.
This recognition has already substantively reshaped Finlay’s approach to business and his company, which has a portfolio of 2,100 apartment units under management with an additional 2,000 in the development/redevelopment pipeline.
That pipeline includes almost 1,000 units either under construction or being redeveloped in Atlanta that were acquired for $91 million through the Middleburg Workforce Housing Fund. The fund, Finlay says, is not just about owning and improving real estate but also about providing services to the residents that are coordinated by Middleburg’s director of community engagement.
The renovations include all major systems, as well as brand new interiors, fitted out with Energy Star appliances and high-efficiency HVAC systems with a focus on security, lighting, and cameras so that residents have a safe and professionally maintained place to live. Also, Finlay notes that Middleburg is sensitive to providing suitable amenities to its resident base across its portfolio. For example, Middleburg makes study halls available as well as different adult education things like financial literacy training (currently the company is trying to partner with a large tax prep company to work with its residents), health and wellness and other services around entrepreneurship.
Ultimately, Finlay says Middleburg’s goal as an “impact” company is to continually measure and refine its programs based on outcomes and helping residents gain greater financial stability thereby improving their housing affordability ratio. “I view impact as engaging the community in a way that is mutually beneficial so if I serve my residents well, they’re going to take better care of their properties,” he explains. Less property damage and more pride in the community improves Middleburg’s investment.
Middleburg’s recognition of this co-dependence on community engagement and financial performance has spawned the other programs in the organization like volunteer paid time off and mandatory community service projects every quarter at every property and every corporate office where residents are invited to participate. The multifamily firm has also launched initiatives like its local heroes program through which its sets aside 5 percent of its properties for local heroes such as firefighters, police officers, EMTs and public school teachers so that those who serve Middleburg communities can also afford to live in them.
Most recently, Middleburg launched Middleburg ¡Mas!, an employee-driven, company-supported initiative that provides a 12-month paid Rosetta Stone Spanish language program along with some paid work time off each week to complete the course. The business case: Having more company employees familiar with Spanish strengthens Middleburg’s operations in its Hispanic communities.
This month, the program concluded with a trip to Yabucoa Puerto Rico where employees who completed the program are given the opportunity to fundraise for the trip to work on roof and home repairs, cleaning and debris removal, and sanitation in communities still suffering from hurricane damage caused by Hurricane Maria and Irma. In all nine Middleburg employees together raised $2,800 to help with trip costs and plan to donate an additional $2,000 to All Hands & Hearts, a volunteer-powered disaster relief organization.
While Finlay admits that he personally has not “done as well as I should have” learning Spanish, the program itself a great example of the win-win Middleburg attempts to achieve—employees are engaged and learning and, at the same time, the company can offer improved communication with its Spanish speaking residents.