Nonprofit real estate company Urban Land Conservancy (ULC) was established in 2003 with $10 million in cash and $7.5 million in real estate as an impact investment by the Gary Williams Energy Company (now Gary Community Investments, GCI).  With a long-standing commitment to Colorado’s underserved communities, GCI seeded ULC to “conserve” strategic urban properties for community benefit ahead of market rate development.

ULC’s focus is community place-based real estate geared to improve the lives of low-income residents. Its emphasis is on making strategic impact real estate investments that will improve the health of struggling communities, as opposed to maximizing profit.  ULC’s real estate strategy is a comprehensive approach for how to turn around neighborhoods with the issues endemic to urban poverty. Gentrification does not solve the problem of poverty, but simply moves it to a new location. The built environment in a neighborhood is a determining factor in how its residents experience their lives. The presence of relevant and positive services provided by nonprofits, businesses, and public entities, along with reliable public transportation, affordable housing, access to jobs, and quality schools, create the milieu for positive outcomes for residents, and has the power to transform high-need communities into healthy and high-functioning ones.

Over the last decade, ULC has been creative in quadrupling GCI’s initial investment, purchasing 24 additional properties in metro Denver including affordable housing, schools, nonprofit facilities and land banking.  ULC has preserved and developed over 550,000 square feet of nonprofit facilities that are home to more than 50 organizations.  These nonprofits serve over 10,000 people and employ hundreds of people annually in metro Denver.  Five of these nonprofits are schools serving over 1,000 students, from preschool to high school. In 2015, in partnership with New Legacy Charter School, ULC constructed Aurora’s first high school for pregnant and parenting teens (both mothers and fathers) as well as a preschool for their children, all in one building.  In many instances like this school, ULC’s impact investments in real estate are supporting nonprofit capacity-building by providing commercial space well below market rate and freeing up operating dollars for other organizational priorities.

In addition to affordable commercial space, ULC has preserved and partnered on the development of over 1,000 affordable rental apartments. Nine of ULC’s 15 affordable housing investments came out of the country’s first Transit Oriented Development (TOD) Fund. This unique partnership with Enterprise Communities, the main investor and manager of the Fund, included financing from program related investments provided by foundations; bank equity equivalent (EQ2) investments; and top loss loan capital provided by the City of Denver. This creative blend of capital allowed ULC to acquire properties along transit lines for affordable housing development and preservation. Three years after purchasing its largest parcel, the first phase of development was completed with the opening of Park Hill Station, 156 permanently affordable apartments on two acres. The remaining 7 acre site will be developed over multiple phases to include more than 350 mixed-income apartments as well as 80,000 square feet of community serving space. ULC’s investments of $6 million will leverage an additional $200 million in development that will provide direct benefit to northeast Denver.  ULC’s $1.5 million of impact investments made through the $15 million TOD Fund will leverage over $400 million in development of community real estate, which includes more than 700 affordable apartments, a new public library, and 150,000 square feet of commercial space.

With Denver’s TOD Fund proven out as a successful impact investment, ULC worked with the Calvert Foundation to create a new source of capital to deploy into community real estate. As part of the Ours to Own Initiative, where individuals can make an impact investment through the purchase of a secured community note for as little as $20, ULC and Calvert created a $10 million Facility Fund to be used toward the acquisition of real estate that benefits metro Denver. This new partnership attracted $3.5 million of PRI from GCI and four local foundations (including Colorado Health, Denver Foundation, Colorado Trust, and Piton) as top loss to the fund. These investments will conservatively leverage $250 million in development that will include over 500 mixed income homes as well as 80,000 square feet of commercial space in North Denver. The Facility Fund also provided needed capital for ULC to preserve an existing warehouse in Sun Valley and a seven-story building in Capital Hill; both buildings provide affordable space for nonprofits who serve thousands of people each month.

 Strategy for Lasting Impact: Community Land Trust (CLT)

In many of ULC’s impact investments, a CLT was used to steward the long-term benefits of the real estate. The use of a land trust is common practice in the West to protect pristine open lands from development; ULC’s use of the land trust and its 99-year ground lease ensures the urban built space remains a benefit for nonprofits and neighborhood residents. CLTs offer considerable benefits: they reduce the financial strain and risk for nonprofits; they protect philanthropic investments in the capital campaigns of nonprofits; and they ensure the property will not be sold for purposes incompatible with the original philanthropic and community focus.

The use of CLTs allows investing in community benefits to be impactful for the long term. From schools to affordable housing and nonprofit offices, ULC’s $70 million of real estate investments ensures these community assets are not lost over time and changes in the market.

Case Study: The Holly Area Redevelopment Project (HARP)

ULC acquired the 2.6-acre Holly Square in Northeast Park Hill in 2009 after it was destroyed by arson connected to gang activity. ULC oversaw demolition of the burned structures and launched a community engagement process to reimagine the entire six block area, which included the former shopping center site and adjacent properties that are home to other community assets.

To ensure that the redevelopment of the property would build on the neighborhood’s strengths and help advance residents’ dreams for a safer, healthier community, ULC and a Steering Committee comprising local residents and stakeholders created a Vision Plan to guide the site’s redevelopment. Today, Holly Square is home to a new Boys and Girls Club, a new elementary school, as well as an outdoor space for community to gather. ULC retains ownership of the entire site, with 99-year land leases in place with both the Boys and Girls Club and school organization. The land lease was critical to both nonprofits building facilities in NE Park Hill.

Fundamentally, ULC’s impact investing is about improving the neighborhood conditions for long term residents that have struggled with the lack of services and are now seeing their community change with the influx of gentrification.

Urban Land Conservancy acquires, preserves and develops real estate to under-served areas for long term community benefit. By making sound real estate investments that include land banking and land trusts, we provide low-income communities with affordable housing, schools and nonprofit office space to strengthen neighborhoods for current residents and future generations.

Aaron Miripol is President and CEO of Urban Land Conservancy. He has 20 years of experience running community development and affordable housing companies. He has over seen more than $400 million in direct economic development, including over 2,000 permanently affordable homes.