Investment with an impact

NKG Corp.’s first major project, an apartment building in the High Falls neighborhood, is on track for completion in early 2024 after years of development. With it, the Brooklyn-based developer hopes to provide a model for the kind of housing reinvestment and access to real estate financing that many areas of the city need.

Named after Neville Greaves and his brother Kadeem, NKG is a family business, run by the brothers with help from their father, Andy. Although the elder Greaves has done general contracting, carpentry, painting and home repair in the Brooklyn area since the 1980s, he always saw real estate development as the next step.

“I always like to say, he had the car already ready. We put the GPS system in it,” Neville Greaves says.

“We have a family business, but this information should disseminate to other people who want to do the same thing as you,” Greaves adds. “To develop not only houses, but also to develop these relationships for Black and Brown people. To redevelop the neighborhoods and build an ecosystem or community where people who want to do it should look similar to the people who live in the neighborhood.”

Nonprofit multifamily lender and investor Community Preservation Corporation and its ACCESS program for BIPOC developers assisted the family business by helping it secure funds and connections for the High Falls project.

“The family is just a pleasure to work with. It’s impossible to not like them and you end up just wanting to help them because of that drive,” says Mena Norman, manager of community impact for ACCESS. “I know when it’s done, it’s going to be absolutely beautiful.”

“Andy immigrated from Trinidad as a young man with a dream and now is able to actualize that dream by passing down that knowledge to other generations in both his family and community,” says Lawrence Hammond, director of ACCESS. “To see a father putting his children into a business and their willingness to take hold of that is a great story. An American story.”

As a Black-run business in an industry dominated by white developers, says Greaves, who also serves as president of 587 LLC Project, the entity that owns the building, it adds another layer to the importance of equity and community impact for the project.

“What CPC is doing for us as minority developers is what we want to do for the public. So, that’s why we stress on affordability and sustainability for this housing,” Greaves says. “We want to help the communities we build in.”

In High Falls

NKG’s first effort in Rochester is rooted in the potential of the High Falls neighborhood, a small area bounded by the Genesee River, the Inner Loop, and Broad and Bausch streets, with a population of about 700 people.

Greaves was introduced to the area by a fellow developer friend who had done a smaller-scale project in Rochester.

“(He) knew we were interested in expanding out and felt like Rochester is a hot market with some opportunities for us,” Greaves says. “We came and visited him, he took us around, we checked out the area and, at the end of the day, felt like, ‘Yeah this is a place we can make an impact.’ Not just for us, but the people who live around the area.

“We looked at a few buildings, but we ended up falling in love with the one we’re at right now,” he says of the location they scouted at 350 State St. “It’s just this beautiful-looking, historic spot.”

The High Falls neighborhood has played a prominent role in the city’s history, starting with factories and mills built in the late 1800s at Brown’s Race, which harnessed the 96-foot waterfall for power. In addition, the neighborhood sits in the shadow of the Kodak Tower, the 19-story headquarters building for Eastman Kodak, a company that dominated the local economy for more than a half-century.

In 1997, Frontier Field–now known as Innovative Field–debuted as the new home of the Rochester Red Wings baseball team, and 20 years later, Monroe Community College opened its downtown campus between the stadium and Kodak Tower. On the far side of the Pont de Rennes bridge, which spans the river, is the Genesee Brewing Co.

As part of ROC the Riverway’s Phase 2 announced in March 2022, the latest plan for High Falls involves creating a state park. While still upwards of 10 years away from completion, the project has already landed a $6 million grant from the state.

Those connections might suggest an easy transition to an entertainment district for High Falls, something the city has pursued since the 1990s. However, housing actually might be the growth driver for the neighborhood. From 2010 to 2020, Brown’s Race exploded from 15 to 129 housing units and grew from a population of 19 to 182. The 16 units in NKG’s building will raise its census block’s housing by 50 percent.

The emphasis on entertainment also obscures the true nature of the High Falls neighborhood to an outside observer. For example, census data estimates that over half of all residents are Black and a similar percentage has less than $14,999 in annual household income. The 2023 federal poverty level for a family of two is $19,720.

“We want to be a part of bringing life into the area because you have different sets of people all over who want to live in a nice space,” Greaves says. “Everyone deserves to live in a nice space, no matter how much money you make or what your skin color is.”

Greaves says the apartments at the State Street location will be connected to the city’s housing voucher system and that the building’s location could be an asset for working-class residents, 40 percent of whom either walk or take a bus to work.

As with many structures in High Falls, NKG’s apartments are part of historic brick houses, which Greaves calls “the icing on the cake.” The four row buildings gave the developers an opportunity to expand the space behind them.

In addition, NKG worked to establish energy-efficient buildings with New York State Energy Research and Development Authority grants for proper insulation and solar banks and panels. Most recently, Greaves says, the company has installed metal roofing, which can last 40 to 50 years.

“Everything we do on the building, we want to make sure it is, one, durable, and two, is energy efficient, and three has a low carbon footprint in the area it’s in,” he says.

He estimates the building is about four months from completion and thinks residents will be able to move in soon after.

A significant step

For NKG, completion is a significant accomplishment and represents the first big step. For real estate development, connections made from years in the industry are key. Since BIPOC businesses have historically faced discrimination in the real estate industry, they lack the years of generational knowledge important for success.

“You may encounter more resistance sometimes because people may not fully believe in what you’re doing, so they may marginalize how they deal with you,” says Greaves, who believes knowledge can lead to a fairer playing field. “When you know what you want from them and they know what they want from you, then it can be a fair exchange.”

Efforts to break into developing in the Greaves’ hometown of Brooklyn were unsuccessful, leading the family to look at Rochester. Practically, CPC says it is nearly impossible for a small Black family developer to get a foothold in the New York City market.

In addition, studies have found access to capital is harder to come by for BIPOC developers. Decades of underinvestment in an area can lead to a catch-22 where lenders are less likely to fund a project because it is underdeveloped, leading it to stay that way. With the NKG building, CPC says it helped to fund the project when, in its view, the loan appraisal was undervalued with no reasonable justification.

“Along that stretch (of State Street), there were several other buildings that had already been developed,” says Hammond. “When we went out there and walked the area ourselves, we were like, ‘Did the appraiser even come out and look at the project or did he just do the appraisal from a desk?’”

In fact, only about 1.5 percent of real estate assets under management are controlled by BIPOC-owned firms and 2 percent of real estate development companies are Black-led, according to a 2022 policy brief by CPC.

“Folks that identify as BIPOC, Black or Hispanic, that makes up almost a third of (the United States’) population,” Norman says. “I don’t think there’s any other industry that has this big of a representation disparity. … You can find Black and brown doctors, lawyers, engineers. This tiny percent in real estate? Painful.”

CPC, already aware of these issues, took a more active role in 2020 following the death of George Floyd by launching ACCESS, which works to aid BIPOC developers with both capital and knowledge.

“In order to create those opportunities, you need to seek out and be intentional about pulling those folks up. We need to double, triple, quadruple down on these efforts to bring BIPOC people into this space,” Norman says, referring to homeownership as a transformational force for generational wealth.

Greaves and his brother were among the first ACCESS class graduates. Armed with that knowledge and trust by CPC, he is confident this project is just the first of many in the Rochester area.

“Give minority businesses more opportunities to have access,” says Greaves. “That’s all we’re asking for. Give us a chance and we’ll give back to the community how we can.”

Jacob Schermerhorn is a Rochester Beacon contributing writer and data journalist. The Beacon welcomes comments and letters from readers who adhere to our comment policy including use of their full, real name. Submissions to the Letters page should be sent to [email protected].