A third-generation resident of Seattle’s Central District, K. Wyking Garrett has fond memories of the MidTown Center property on 23rd and Union. He remembers getting french fries at the now-closed Thompson’s Point of View restaurant, where his sister worked in high school, and waiting in line at the nearby post office with his father. The property was also the former home to Liberty Bank building, Seattle’s first bank owned by African Americans. Garrett’s grandfather was a co-founder.
MidTown Center has remained a stronghold for the historically black neighborhood amid dramatic displacement. The Central District went from more than 70 percent African American in the 1970s to less than 20 percent in 2015. By next year, it is expected to drop to 14 percent.
“We’ve seen buildings gone, businesses that have been there for a long time are no longer there,” Garrett said. “Restaurants, like Thompson’s Point of View … we’ve just seen the erasure of the black community.”
The block has become emblematic of the Central District’s struggle. It is the subject of a song by Seattle hip-hop artist and activist Draze called “Irony of 23rd.”
As president of Africatown Community Land Trust, Garrett has been fighting, along with other activists, to preserve MidTown Center for the Central District’s black community ever since the property came up for sale a few years ago. In May, the organization reached a landmark deal with help from a new investment fund launched by land protection non-profit Forterra.
Forterra has raised a $10.5 million fund designed to help preserve and create community land and affordable housing in the Seattle region. It is a for-profit fund, with a modest 2 percent annual return. The unique model attracted the attention of big names in the tech industry, including Madrona Managing Director Tom Alberg and Nick Hanauer, an activist and venture capitalist with Second Avenue Partners. Forterra is launching the fund at a time when massive job growth in tech and other industries is putting strain on Seattle’s housing market and squeezing out lower-income residents.
“I was intrigued by it because over the years, there’s been lots of discussion of different ways to accomplish social purposes other than just asking for donations,” Alberg said. “Many of us … give lots of money as donations but there’s been a trend toward investing in socially-oriented companies, companies whose mission is not to maximize return but a profit-making entity that has, in some ways, social goals that are more important.”
Forterra is a 25-year-old organization that, throughout most of its history, has focused on preserving wild lands and farmland in the Pacific Northwest. Now the non-profit is turning its attention toward protecting urban land for communities that have been rattled by Seattle’s rapid growth, which is driven in part by the booming tech industry.
“In order for old growth trees to thrive, in order for a farmer to grow radishes or blueberries, in order for a community group to come together … each of those creatures needs a place to grow and to thrive,” said Michelle Connor, executive vice president of Forterra. “And who owns the land determines what the outcomes of that land will be.”
In the case of the MidTown Center project, Forterra simply leveraged its real estate expertise and acted as an intermediary. That helped Africatown Community Land Trust and Capitol Hill Housing, a non-profit affordable housing developer, to secure ownership of 20 percent of the property in partnership with a private developer, Lake Union Partners. Both plan to build affordable housing on the property, with more than 500 units for people with incomes between 40 and 85 percent of the area median, according to KNKX.
This story has been updated to clarify the roles of Forterra and Capitol Hill Housing in the property sale.
“Just the presence of the fund changed the conversation from being about activists fighting the development, to a community being invested equitably and engaged in the decision-making around the development,” Connor said. “For us, that was quite powerful.”
MidTown Center was the first of several projects tied to the Forterra fund. In January, Forterra invested $3 million, in addition to outside financing, to purchase a 1.7-acre property in Tukwila across from a mosque. In the next nine months, the organization will work with leaders in the Somali Community to raise the necessary capital to convert the property into an international marketplace.
“That neighborhood is very close to downtown Seattle,” Connor said. “It’s very close to light rail. It’s rapidly changing and that’s a good thing. The economy is doing very well there. But there are over 60 small businesses, that are predominantly run by women in the families of these Somali community members, that will be displaced and there is no place for them to go. So we are trying to keep up with the speed of the change in the neighborhood to house as many of those small businesses before they are displaced.”
In total, Connor expects the fund to support around seven projects when it reaches its $15 million target. She says that she’s seeing growing interest from the tech community to invest in this kind of model.
For Garrett’s part, he welcomes investment from an industry that has rapidly transformed Seattle and left some communities behind.
“We have significant billionaires in this city and they should not be involved in displacing communities,” he said. “They should be involved in helping to support all of our communities to grow and thrive.”