By Brian Pascus
Don Peebles is arguably the most successful Black real estate developer in the United States. For more than 30 years, Peebles has made his mark across America: first in Washington, D.C, through office building development, then in Miami with a number of luxury hotels and condos. Today, he’s looking to build transformational, multibillion-dollar, mixed-use real estate projects in both Los Angeles and New York City with Angels Landing and Affirmation Tower, respectively.
Peebles is also a founding member of the New York Real Estate Chamber, an organization devoted to addressing issues faced by New York City’s minority business community. During the organization’s 10th anniversary celebration on June 9, Peebles took time to speak with Commercial Observer, shortly after U.S. House Minority Leader Hakeem Jeffries and New York Gov. Kathy Hochul addressed the group at the Harvard Club in Midtown Manhattan.
Commercial Observer: You’re arguably the most prominent real estate developer in the building today, so let me ask you: What has the New York Real Estate Chamber meant to you as a businessman?
Don Peebles: Well, I think first of all, what NYREC means to me is you have a diverse group of developers, women and people of color working together to expand the horizon of opportunities for all of us, sharing best practices and experiences and notes, and having someone you can bounce things off. If you look at our industry, it’s heavily under-represented in terms of diversity, and this organization is helping change that quite a bit.
And it’s addressing the needs of the overall community. The pillars of our democracy rest on capitalism, and, in order for democracy to endure, capitalism has to endure, and capitalism can’t endure if it’s inequitable. So it has to be fair, and I mean not fair on outcome, but fair on opportunity.
In your eyes, how has local politics impacted commercial real estate development?
We’re seeing the politics change in New York City and New York state. The politics have changed dramatically. If you look at the leaders of the state, they’re either people of color, or women, or both, and so now the economic environment will follow that. Politics normally leads the way and the economic environment will follow. So I’m a big believer that economic opportunity ought to reflect the diversity of a population’s demographic, and politics ought to lead the way for it. So the New York Real Estate Chamber is about us all working together to make our industry better and help provide housing that’s sorely needed and other jobs and economic opportunity.
I believe REBNY [the Real Estate Board of New York] and the industry as a whole has had such significant resistance in the New York State Legislature and the City Council because of a lack of diversity, because many of these members in the Assembly and the Senate or in the City Council, their populations, their constituents are diverse, and they don’t see the economic benefit of our industry that does more than just provide housing or office space or hotels — it’s jobs.
Today’s the 10th anniversary of the New York Real Estate Chamber. How have you seen it grow and develop in your time?
I’m a founding board member. When I first started doing development business in New York, this organization was in the embryonic stages of being founded, and I joined it because of what it stood for and what was needed. And, at that point, I think I was on the Board of Governors of REBNY, as well. So we had our quarterly meetings for NYREC in the conference room of (law firm) ArentFox, and I think on our first anniversary a new candidate who was leaving the state government to run for Congress came to speak to us, and that was Hakeem Jeffies. We were a small organization, but still, future leaders like Hakeem saw fit to engage with us.
As our organization has grown, we’ve grown in terms of membership and influence within the political spectrum, and just like Hakeem Jeffries has grown from candidate to congressman to Democratic leader, our organization has had a similar trajectory. So I think you’ll see the New York Real Estate Chamber will be consulted and be more engaged in the political and regulatory process that shapes our industry.
As a businessman who has a national footprint, but also has done many deals in New York City, is it different to conduct business in this city and in this state?
I think some places are much more hospitable than others. I think as a Black developer, Atlanta is extremely hospitable. Washington, D.C., my hometown, has always been that way. If you look at one of the more difficult places to do business, it would be Los Angeles. I would think from a transactional and regulatory environment, up till COVID, New York City was the most efficient. It changed after [former mayor] Mike Bloomberg left office, and you saw more headwinds in terms of just going through and doing business as a real estate developer.
It became more difficult and the regulatory oversight expanded into areas like special permits for hotels with 200 rooms. So New York changed — it was the epicenter of entrepreneurship — and part of why the regulatory environment changed was a lack of inclusion. The most business-friendly environment — up till COVID — for real estate was New York City. But it lacked diversity. And, so, you had, in terms of women and minority developers and investors, there were very few of us. And a big part of that was the lack of access to capital, because capital is allocated based on relationships, and so people use their personal relationships and long history as allocators to continue to grow their business, and so that was the biggest impediment.
There’s a lot of young real estate professionals in this room. What’s the best advice you’d give young, Black real estate professionals to make their way in the industry?
Great question. I think one of the important contributions that NYREC makes is to provide a vehicle for those young, early in their career, emerging developers of color or aspiring developers of color, to give information and access. My advice is never expect it to be easy — because it won’t be. But you want to be a student of the business and understand the business and understand the sector you want to go into.
Our company has always grown when we’re doing business in more challenging environments such as recessions, or pullbacks, because then it’s harder to do deals, and when it’s harder to do deals there’s fewer done and there’s great opportunity. The key is being a student of the business, not expecting it to be easy, and not quitting. And once you have made a commitment to a project, figure out the solutions, because it’s going to have lots of bumps in the road.
Just like anything else, if you want to be good at anything — businesses, education, music, journalism, writing — you have to be a student of it and you have to be committed to it. And if you don’t love this business, you shouldn’t do it because it’s a business of headaches, lots of headaches, lots of problems, lots of risk. You have to really kind of love it, and part of why I’ve had some success is I actually like the business.
What would you tell young people in the industry who are growing more concerned about equity and fairness?
I’d tell them business is a place to bring about change because we can use capitalism as tools of transformation. We can use the real estate business as tools of transformation because how we do business can have a major impact. Our company is committed to at least 35 percent of all our contacts going to women and minority firms round the country — that is a vehicle of transformation.
Also, as business people, we expect excellence because we can’t stay in business without it. So I don’t think we do diversity for the sake of diversity, but we look at things with a wider lens. People should look when they go into this business to use it as a tool for transformation.
Where do you want to see NYREC 10 years from now, at the 20th anniversary celebration?
I would like to see the conversation different, meaning we have gotten to a place where everyone is getting essentially fair access to capital, fair access to opportunity, so it’s a discussion about how the industry can make our society better, how NYREC can make New York City better, how can we provide opportunities and engage and expand the universe of talent that comes to the industry.
I’d like the conversation to be about how all of us have put more back into the community — started schools, provided scholarships, fully engaged in things successful businesses do, which is to invest in their community. But I would hope we would have turned the page in terms of economic inclusion.
Credit: Commercial Observer
