How Community Capital and Real Estate Development are Opening Small Neighborhood Businesses
Sustainable development is a movement sweeping the country that’s revitalizing neighborhoods by building accessible housing, encouraging entrepreneurship, and building community assets that everyone can enjoy. But, what happens when a real estate developer builds an incredible retail space, but small businesses have a hard time accessing the funding to move in?
The last thing anyone wants to see is an empty storefront, which is why some real estate developers with a mission-driven focus are connecting their potential tenants with alternative sources of capital, like crowdfunding.
Sustainable Community Associates is a Cleveland-based real estate development company that values inclusion, celebration, and expansion in the projects they take on. They design projects that still protect the historical integrity of the spaces they enter but also are environmentally sustainable and are accessible to all kinds of people.
It’s obvious that small businesses greatly enhance the neighborhoods they’re in, and they’re often a major draw for people to move into a new area and get involved in their community. However, small businesses are in trouble as traditional sources of capital are becoming more difficult to come by, which can make it difficult for developers that are looking for small business tenants to partner with them.
In 2020, Sustainable Community Associates partnered with Leavened Bakery in Tremont in a tenancy agreement to have the artisan bakery be the flagship location of their newest building, the Tappan. However, Ian Herrington, the owner of Leavened, needed to access funding to build-out the space and provide working capital for the opening.
Ian connected with Honeycomb Credit and ran a loan crowdfunding campaign that raised $43,550 to open Leavened. Honeycomb is a loan crowdfunding platform that gives small businesses the opportunity to take out a loan from their community, not a bank. This is a great resource for businesses just starting out who might not be able to get a bank loan, or who would rather pay back their neighbors than pay back Wall Street.
For Ian, the reason he connected with Honeycomb was that he wanted his bakery’s opening to really be a part of building a community at the Tappan, and to get people interested in their new neighborhood bakery by being able to invest in it!
“Honeycomb's ability to let me access people in my community really helped me jumpstart my business, not just to get the funding I needed but also to get my name out there,” says Ian.
Josh Rosen, a partner at Sustainable Community Associates, says, “Our work and commitment extends beyond the building itself and into the neighborhoods we’re entering. This is why we’re so pleased to support small businesses like Leavened by providing a space for them to occupy, and partners like Honeycomb that help them access the funding to thrive.”
Now, Leavened is open and a valuable neighborhood asset to the residents of the Tappan, who can go down to the bakery for a bite, or stay a while and build community over a cup of coffee and a pastry.
“The community's response to my campaign was truly overwhelming,” says Ian. “I think people invested in my campaign because they truly wanted a neighborhood bakery. I was shocked by how many people were willing to contribute to my bakery.”
Get your community involved with building your neighborhood
You can attract star local businesses into your projects and strengthen neighborhood bonds by connecting your small business tenants with community capital through Honeycomb Credit. Learn more about how Honeycomb small business loans can help local entrepreneurs at www.honeycombcredit.com/grow.