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Real estate change agents: Taking on the challenge – Milwaukee Business Journal

2016-2017 ACRE student

For young African-Americans like Lavelle Young, the path to becoming a real estate developer in Milwaukee is challenging — but times are changing.

​It was notable when all four developer teams competing to redevelop Milwaukee’s North Dr. Martin Luther King Jr. Drive library included minority firms.

It is testament to how white the real estate development industry in the Milwaukee area has historically been that a handful of minority-led developers is remarkable. Integration has been slow around greater Milwaukee despite efforts by local developers and training programs like Associates in Commercial Real Estate, or ACRE.

But in the past year a number of new faces have emerged in lead developer roles to take big risks to build careers, and change the community.

The shift means more than diversity for diversity’s sake. It means higher-quality housing in neighborhoods largely neglected by the real estate industry. It means the chance for minority communities to build wealth, not just make money, and for those developers to serve as examples to Milwaukee youths and, eventually, to hire them into well-paying jobs.

But the road to success in real estate is difficult even for folks with money and recognition. It is doubly so for startups without either. What follows are the stories of Milwaukeeans who are accepting the challenge.


ACRE student Lavelle Young

Name: Lavelle Young

  • Age: 24
  • Company: Young Development Group
  • Year founded: 2016

Lavelle Young is familiar with the stats regarding segregation, black male incarceration and the story they tell about Milwaukee.

But he’s still optimistic. He thinks that story is changing. The current real estate market and shifts in city government policy are creating opportunities “for us to redefine ourselves,” the longtime Milwaukee resident said.

“Regardless of whatever the past may have been, or historical statistics are, I personally believe we all have an opportunity, that I have an opportunity as a black male,” Young said. “I’m very optimistic in terms of the way the city is trending to support the historically disenfranchised.”

Combine that conviction with ambition, and you’ve got Lavelle Young. Young is competing for his first Milwaukee project, the redevelopment of the North Dr. Martin Luther King Jr. Drive library. He partnered with Gorman & Co. Inc., an established Oregon, Wis., developer. They are among four teams vying to partner with the Milwaukee Public Library system for the project.

“I’ve always aspired to be in real estate and I knew that was where I was going to go in my career,” Young said. “I wanted to be the investor. I wanted to be the CEO. I always like pitching myself in that role. I was always waiting for the right time, and I was always waiting until I felt confident enough in the skills I was acquiring over the years.”

Young has been in business for himself since last May. Prior to that, he was president for two years of the Black Student Union at the University of Wisconsin-Milwaukee. He interned at Johnson Controls, and took online real estate courses to learn about the industry.

Earlier this year, Young was wrapping up work as a commercial loan underwriter for Legacy Redevelopment Corp. and left UWM before graduating to put more time into his business. He was a top graduate in June in the 2016 ACRE class, and took the Wisconsin Housing & Economic Development Authority training course. After hours, he crafted a pro-forma around an affordable development that became the model for his MLK Drive proposal.

Young spent his waking hours focused on financing, which is the foundation that, more than concrete, truly supports real estate development.

“I don’t mind taking many, many hours staring at a computer screen, staring at an Excel spreadsheet,” Young said.

It’ll be months before Young knows whether he will win the MLK Drive library redevelopment project. In the meantime, he is pursuing other opportunities in Milwaukee County.

“Nothing is final until that shovel is in the ground and until that last brick is on the building,” Young said. “I’m still finalizing agreements and partnerships. But that challenge is being persistent, persevering. You do have a lot of no’s. A ‘no’ is not a bad thing. A ‘no’ is let’s see what it takes to get to ‘yes.’”

Q&A with Lavelle Young

What made you want to be a developer?“I’ve always had a passion for real estate and aspired to have a career in the industry. I’ve taken various real estate training and have been involved in many workshops and educational programs since 2012. When I started working at Legacy Redevelopment Corp. in June of 2015, I immediately was exposed to the business environment of Milwaukee. I was able to meet many small business owners, understand different business sectors and the financials that pieced it all together.

“After being accepted into the Associates in Commercial Real Estate (ACRE) program, I found a focus in the real estate industry. When the program began, it created a twofold increase in the experience that I also was receiving during my employment. This experience is what showed me a clear path to becoming a developer.”

What is the biggest challenge you had to overcome to break into the industry?“Graduating from the ACRE program, starting my development company and proposing my first development project, all at the age of 23 years old, presented many challenges. The biggest challenge has been the perception of being inexperienced, unqualified and incapable due to my age. However, I’ve made a commitment to myself to never let that hurdle inhibit my progress in pursuing my goals. It is my priority to make sure that I am well prepared and equipped with knowledge, skills and resources before pursuing large endeavors. This has allowed me to face the challenge head on, persevere and overcome it.”

What impact do you want to make on the local community?“I believe it is my duty to return the investment that was made in me back to the community. I plan to do this by adding value. I am a strong advocate in the idea of real estate being the means to build and attract value to a community. The more economic value a community has, the more it can reinvest its resources in it’s people to create and maintain sustainability. It is through these means that I plan to make an impact.”

What will it take to draw more minority developers into the industry?“There are many ways to attract underrepresented individuals, like myself, to the development industry. Imagining themselves in these positions is what I believe to be the most significant way. They see themselves in those positions by seeing role models who look like them. To draw-in future developers, we need to continue to find ways to provide connections and exposure to the current role models in the industry.”


ACRE students: Index Development team

Names: Que El-Amin (32); Jackie Carter (53); Rafael Garcia (41); Heidi Henley (40); and Alexander Walker (35)

  • Company: Index Development
  • Year founded: 2016

Four phones chime at 2:30 in the morning with an update on the development.

One of the five members of Index Development is hard at work on the team’s first project and sent a group text to the others. Those teammates — Que El-Amin, Jackie Carter, Rafael Garcia, Heidi Henley and Alexander Walker — all have day jobs and families.

So it’s normal that when one wakes up for an early morning start, others are at the tail end of a late-night work session. There also are Sunday meetings with attorneys during Green Bay Packers football games.

“It speaks to the passion this group has collectively, the love for this community and the love for people,” Garcia said. “We all come from humble beginnings and we’d be lying to you if we said we didn’t want to make any money, but we know this community is in need of safe, affordable housing.”

Index Development’s first project is a four-story building with 41 apartments in the 3600 block of West Villard Avenue in Milwaukee. Like many starting Milwaukee developers, they will seek affordable housing tax credits to finance it and will reserve apartments for low-income residents.

The five are crafting that project — and pursuing more for 2017 — on top of the job and family that most call a complete life’s pursuit.

Garcia is executive director of Community First, which since 2004 has rehabbed more than 1,600 houses for owner-occupants using federal funds. Carter teaches financial education for YWCA Southeast Wisconsin and is property manager of Johnson Park Lofts in Milwaukee.

El-Amin runs a company that teaches high school students science, technology, engineering, arts and math. Henley is in the Milwaukee County Transit System’s treasury department, and Walker works in the city of Milwaukee plan examination department. “I’ve got to feed the family,” Walker said. “I have a daughter, one on the way, bought a new house. I’ve got to keep the day job, but while doing that find opportunity with this group to make things happen.”

The five met through the ACRE program, where they were randomly assembled into a work group and made the Villard Avenue development their class project. After graduating the class, the team pitched their proposal to three experienced developers, seeking a partner to move it forward. They teamed with Brinshore Development of Northbrook, Ill.

Such partnerships are common, and crucial, to start-up developers. It cost about $40,000 to get the Villard Avenue development to its current point, El-Amin said. That cost of doing business is a tall barrier to entry.

Brinshore brings financial resources to help pay for that work, and also experience in pricing out the project costs and applying for the housing tax credits the project will require. The partnership lets the Index team continue to lead the project by burning the midnight oil while learning from more experienced developers along the way, Carter said.

“We wanted to be involved in every way, except for the financial part where we are unable to,” Carter said. “You really need to find a development partner who is going to be willing to work with you, nurture you and guide you so you can learn as much as you can for the next development you take on.”

Q&A with Jackie Carter of Index Development

What made you want to be a developer?“Initially, I didn’t plan to be a developer. I became intrigued with real estate development in my early years of living in Milwaukee over 20 years ago while working at First Wisconsin Community Investment Corp. While there, I had an opportunity to work with two developers — Robert Lemke and Todd Hutchison — who are still making a difference here in Wisconsin. During my time there, I witnessed firsthand the hard work and dedication it took to develop quality housing. But what struck me most was the impact that those developments had on the lives of the people who lived in the neighborhood and most importantly to the new tenants who would reside in the developments.

“I observed how new tenants had this great sense of pride and they felt so fortunate to have the opportunity to live in a development that was safe and that they could feel proud to call home. It was overwhelming. From those experiences I discovered a deep passion within myself, a spark that I didn’t realize was there.

“So as much as I was intrigued and passionate about development, I never thought of it as a career option. I didn’t feel it was a possibility. But that spark never left and has directed the steps in my career such as working with organizations that help establish quality and affordable living where there otherwise was not any available. I have increased knowledge and readiness of residents of Milwaukee preparing for home ownership and I am currently property manager of a low-income housing tax credit development.

“And now fast forward years later, the ACRE program happened, and it made being a developer a possibility because it gave me the opportunity to learn directly from developers and other major players in the field who are already making such a great impact. I feel that I have come full circle. That initial deep passion I felt many years ago has now been reignited.”

What is the biggest challenge you had to overcome to break into the industry?“I was my biggest challenge. I didn’t believe I could do it. I didn’t think it was an option. However, no matter where I turned in my career I saw glimpses of myself doing tidbits of what developers do and skills they need to possess. I almost didn’t apply to the ACRE program because I still had this doubt, but Robert Lemke took the time to talk to me about the great benefits of ACRE and encouraged me. So when I finally stopped doubting myself and applied to the program, it has led me to this next phase.”

What impact do you want to make on the local community?“I have lived and worked in the city of Milwaukee for more than 20 years. So when I think of Milwaukee, I think about the many unique neighborhoods there are, the various cultures and traditions that are part of the families that live there, but many of those neighborhoods aren’t being built up, they’ve been neglected for years.

“I plan to utilize the newfound knowledge and skills that I’ve gained from ACRE to create new and forward-thinking developments into the heart of those neighborhoods in an effort to uplift them. I’ll never forget the many individuals that I’ve met and spoke to who were absolutely overjoyed when new developments were created in their neighborhoods. It was life-changing for many and I want to be a part of changing lives.”

What will it take to draw more minority developers into the industry?“It’s going to take seeing more minority developers. And for that to happen, it means that more minority developers need to have the opportunities that I was fortunate enough to come across. It needs to be something that more people believe they can do. I admire Mark Eppli because he recognized a need and developed a plan to address the need, and I’m so grateful for programs like ACRE that make this possible.”


ACRE student: Brandon Rule

Name: Brandon Rule

  • Age: 28
  • Company: Rule Enterprises
  • Year founded: 2012

Brandon Rule has been at it for five years and hasn’t seen his first payday yet.

That first payment is only a few months away when he closes financing for his first project and collects his first developer fee. That deal will bring 56 apartments to 704 W. National Ave. in a neighborhood where Rule grew up. But to reach this point, he’s taken on substantial debt and tallied “countless” hours without getting a check.

“I’ve worked more than a full-time job doing this without earning one penny, not one penny from it yet,” Rule warned. “Unless you are ready to really invest in yourself, don’t even think about it. I do it for my community. I represent inner-city youth, inner-city entrepreneurship, inner-city growth, and progression and creation of wealth.”

Rule recognized that wealth built up over multiple generations of families — the kind of money needed to make projects happen — for the most part is not available to starting minority developers. He didn’t have a rich uncle to call. His personal income built through banking jobs wasn’t enough to leverage the money needed to move his projects forward.

“I had to find some affluent individuals or people who have influence to make decisions, and I had to figure out what they needed from me to give them comfort in funding what I’m doing,” Rule said. “By no means is this an excuse. I’m not using it as a disability or anything like that. I’m using it as my fuel to go that much harder.”

Rule recently left jobs working on business loans at two community development financial institutions to focus exclusively on Rule Enterprises. He previously worked as a personal banker, but had an interest in real estate.

He started heavy networking in 2011, and in his off hours worked on a pro-forma laying out financial plans for an affordable housing development. He was on a developer team that unsuccessfully competed in 2014 to redevelop the former Esperanza Unida building at 611. W. National Ave., a block from his current development.

“I was going to develop a project in my neighborhood, there was no other option,” Rule said. “All throughout 2015 I gained the confidence I could do it. I was a developer in my eyes, but no one else’s.”

Rule gained credibility after gaining news coverage for his affordable housing project at 704 W. National Ave., which he is doing in partnership with Horizon Development, Madison. The day that project went public in February, Rule was pitched the opportunity to buy and redevelop the former Judge’s Irish Pub property on East North Avenue. He is now moving forward with plans for a five-story building with 58 luxury apartments on the Judge’s site.

Longer term, Rule is growing a business to promote entrepreneurship in the central city called The Rose that Grew. That effort is in line with Rule’s broader perspective about the work he does.

“I realize the importance of the creation of wealth and I see real estate investment as a tool to do that,” Rule said. “If I can improve the housing stock and the community around me by working and developing and investing in my community, I can be the change I want to see in a positive way. I can listen to the community, and we can make the decisions we want to see.”

Q&A with Brandon Rule

What made you want to be a developer?“Growing up, being an adolescent, I knew I wanted to be a doctor. I was going to be a medical doctor and I wanted to help people. I even had an email called Dr. Rule at Yahoo or Hotmail. Then in my freshman year at Marquette University I was taking chemistry and bio and I was trying to get into physical therapy but that wasn’t for me. Even in high school I knew I wanted to do real estate on the side, buy and sell houses.

“Then I went through the ACRE program while I was in school and I was exposed to what a development was and what a developer does and I thought my skill set lends itself well to that. I’m very driven. I’m very charismatic at times. I work extremely hard and as a developer you have to work non-stop.

"I had a ton of sales experience growing in the jobs I was working. You have to be able to sell yourself. You have to be able to do that, and I love numbers. Working on the pro-formas and doing all of those things I thought, OK, this gives me financial freedom, it gives me flexibility, it gives me the ability to help the community as well. This is what I want to do.”

What is the biggest challenge you had to overcome to break into the industry?“Access to capital and getting people to support you with no balance sheet. I felt like if I had wealth this would be much easier. Every development is a challenge. I’m not saying anyone else has it easy. But from my perspective one of the biggest things is my youth doesn’t allow me to get site control. I couldn’t get site control for the first couple of years I was trying to get these deals. I kept swinging, kept missing.

“I couldn’t get any financial resources. Maybe I could get site control, but where could I get $25,000 to put down for the site? That is very, very difficult — building that capacity and having that track record with no balance sheet and no experience.”

What impact do you want to make on the local community?“I want to create wealth. I want to help others create wealth. I want to expose people to things they may not know are possible. I think belief in self is one of the most important things in the world, so I want to help them really through The Rose That Grew become all the things they can be.”

What will it take to draw more minority developers into the industry?“Creative financial resources and good partnerships that are looking to actually help and not just make money. The ACRE program does a great job of exposure to commercial real estate. That’s one step. I think that’s done. But after the exposure there has to be more resources for the developers to become an actual developer. I know those four years I didn’t have anything. I created Rule Enterprises out of literally nothing. Even after I did that there’s still so many roadblocks and so many hurdles. We need some creative financing to help close those gaps, and not loans.”


ACRE student: Terrell Walter

Name: Terrell Walter

  • Age: 30
  • Company: Royal Capital Group LLC
  • Year founded: 2010

Terrell Walter got a big chance in 2012 when Kevin Newell hired the then-26-year-old as the first employee in his development company.

“We discussed it after I was hired, and I was the one with the least experience in the real estate industry,” Walter said of the job candidates.

Walter moved from his job at Wells Fargo, where he was recently promoted, to work with Newell on two Dane County projects with a combined 335 apartments. That hire meant Walter has become a project manager in big-league housing development in four years, instead of slowly building skills through a long road of single-family housing rehabs.

“Coming from where I’m from, I couldn’t fathom the idea of multimillion-dollar deals,” Walter said. “It was smaller home runs at the time. Within my first week at Royal Capital, I’m handed a seven-figure budget and told to go get it done, we trust you to execute.”

Walter is now ready to transition from apprentice to mentor himself. The growing firm is looking to hire in 2017, and one of those hires will likely be someone whose talents they’ll develop in-house. Next, Royal Capital will launch its own entrepreneurship training program to teach residents the basics of businesses.

“Real estate fuels everything else the company will ever be able to do at this point, but we have the goal of being able to instill business skills,” Walter said.

Walter also wants to volunteer more at local schools in 2017 to talk about career opportunities in business.

“From what I know, they are consumed with what they see on their blocks, in their neighborhoods on the day-to-day,” Walter said. “That is the norm. Anything outside of that is, well you’re lucky or your circumstances must have been different.”

Walter wants to demonstrate that luck isn’t the factor, and remembers when he learned the same lesson himself. While in high school, a younger African-American man and former north side Milwaukee resident visited to discuss his current job at a national accounting firm.

“I know how that matters,” Walter said. “It’s huge in terms of changing the psyche. Not only do they need to see, they need to be able to say, ‘Hey, it’s possible.’ That’s a 2017 goal for sure.”

Developing people also is a running theme on Royal Capital’s projects. The company isn’t counting on any revenue from a coffee shop space planned in its 181-unit apartment project set to break ground next spring in Milwaukee's Brewers Hill neighborhood. Instead of leasing it to a national chain, company officials want to hold a contest to give local people the chance to compete to open a cafe there. Royal Capital will provide financing and business support for the endeavor, Walter said.

“We can attract a national or local player to fill that space, we are already getting some calls on it,” Walter said. “We are putting everybody on hold because we want to see what is out there. We want to see if there is even a local smaller shop that wants to expand.”

Q&A with Terrell Walter

What made you want to be a developer?“Post-college, I yearned for a career that offered autonomy, was challenging, provided me with the opportunity of continual growth (through learning), and most importantly allowed me to influence change by making a positive impact in my community. My role at Royal Capital Group checks all of the aforementioned boxes.

“For example, I am managing all aspects of the development process for the Mill Road Library project (in which Royal Capital Group is partnering with Maures Development Group). With this development we plan to replace the Milwaukee Public Library on (North) 76th (Street) and Mill Road with a new 17,000-square-foot library and 65 apartment homes on (North) 77th (Street) and Good Hope (Road). I lived and worked in this neighborhood during my high school years, so I know how important the library is to the families within this community.”

What is the biggest challenge you had to overcome to break into the industry?“The experience gap. Most opportunities in the industry require some level of experience. Of course, in order to gain that experience, you have to be employed within the industry. Being hired as a project coordinator at Royal Capital in 2012 afforded me the opportunity to utilize transferable skills to lead certain aspects of the development process while gaining the experience needed to effectively lead the entire development cycle.”

What impact do you want to make on the local community?“Personally, I want to encourage and inspire others to live a life of continual growth. I offer my time, resources, and network to assist others as they pursue business ventures (often non-real estate related) in hopes that it creates a culture of like-minded individuals supporting and guiding others as they grow.

“As a company, Royal Capital believes in storytelling through urban development. This causes us to be more selective in the projects that we pursue, and helps us to ensure that we are adding value to the communities that we develop. This always extends past bricks and mortar.”

What will it take to draw more minority developers into the industry?“Two things: Commercial real estate companies/developers have to own the responsibility of hiring and developing a diverse workforce. It’s evident at every real estate event or conference that I attend across the country that this industry could use a boost in this area.

“Individuals with aspirations to be a developer have to be very intentional with their efforts in pursuing that goal. This includes obtaining the proper education (through ACRE, the WHEDA development training program, or a degreed program at a college/university), being resourceful and networking.”