Creating an Atlanta Where All Entrepreneurs Can Thrive
Helping small businesses succeed amidst rising real estate costs
The following blog post is part of the City Accelerator initiative, a collaboration between Governing, the Citi Foundation and Living Cities that aims to speed the adoption of innovative local government projects within and across cities that will have a significant impact on the lives of their residents, especially those with low incomes.
Atlanta has a long-standing reputation for being a city where minority entrepreneurs can thrive and succeed. Since the innovative programs that the late Mayor Maynard Jackson first put in place in the 1970s, the city has helped hundreds, if not thousands, of businesses owned by people of color get started and grow into some the of the leading African-American owned businesses in America. So how is it that Atlanta’s business inequity problem has become such an uphill battle?
Across the country, co-working spaces have been a boon to new businesses looking for their first commercial space, but there have been some unintended consequences. As neighborhoods gentrify and become more popular to newcomers, existing businesses become at risk of being displaced and locally based entrepreneurs are often unable to afford the rising cost of commercial space to start or stay in the neighborhood. This challenge of displacement is exacerbated by the need for entrepreneurs to navigate changing demographics, market shifts, rising costs and institutional bias to be successful.
Kiyomi Rollins, owner of The Good Hair Shop, became an entrepreneur because she did not feel her passions existed in a traditional corporate environment. Her business, which focuses on uplifting and supporting the natural hair community with plant-based products, was located on Atlanta’s Southside.
“The true pulse of Atlanta is the SWATS,” said Rollins. SWATS stands for ‘Southwest Atlanta Too Strong,’ an acronym used locally to show pride in the Southwest Atlanta neighborhoods. “I recognize the value and opportunity from the rich legacy that already exists and what will emerge.”
Unfortunately, Rollins recently found herself on the receiving end of a ‘Notice of Intent to Evict’ letter for The Good Hair Shop. And during her time as a business owner on the Southside, she’s seen other small business owners become displaced from the neighborhood as well.
Due to these market shifts, the City of Atlanta is actively seeking new solutions and developing specific programs to address the opportunities and challenges successful small business growth faces due to rising real estate costs. In 2018, Mayor Keisha Lance Bottoms announced the city’s competitive selection to participate in Living Cities’ City Accelerator program, supported by the Citi Foundation, and the receipt of $100,000 in grant funds to pilot solutions to help strengthen local businesses owned by people of color and create jobs.
Atlanta targeted these resources to establish the Accelerate Southside program, which will focus on four major challenges experienced by businesses owned by people of color:
• Limited access to capital based on traditional underwriting criteria
• Debt service payment capabilities
• Difficulty accessing commercial space
• Preparing for business growth
The initiative is being spearheaded by Invest Atlanta and will dive deep into each of the challenge areas addressing topics that entrepreneurs of color may not be familiar with – all with the aim of restoring the promise of entrepreneurship and real estate as sources of community wealth building for area residents.
Atlanta’s Southside neighborhoods are home to an estimated 3,300 businesses that generate $3 billion in revenue and employ more than 43,000 people. But much of this area, geographically located below Interstate 20, has historically not received the same level of interest and investment compared to other areas of Atlanta such as Buckhead or Midtown.
However, with the announcement of several catalytic projects, the Southside’s real estate market is becoming more dynamic and property owners are raising rents and seeking to replace their existing tenants with higher paying, commercial grade tenants. This phenomenon is resulting in the displacement of hyper-local, hyper-native, and legacy businesses that serve a demographic often overlooked by national retailers. As this trend continues, the City of Atlanta is interested in launching new programs, products,\ and policies to help stabilize legacy businesses and preserve neighborhoods’ cultural identities.
By choosing to focus the initial launch of Accelerate Southside at Pittsburgh Yards, Invest Atlanta seeks to demonstrate that Southside neighborhoods have the ability to attract and support local businesses that meet the neighborhood’s need for amenities, and prove the concept of businesses of color investing in neighborhoods that reflect their culture and prospering.
In order for this program to have maximum, sustainable impact, Invest Atlanta understands that key partners that are invested in equity and wealth building are crucial. One such partner is The Guild, a co-living organization that targets social entrepreneurs and change makers and focuses on community wealth building strategies that aim to improve the ability of communities to increase asset ownership, anchor jobs locally and build economic resilience.
Accelerate Southside received more than 90 applications for the first phase of the program – a clear indicator that there is appetite for a program like this in Atlanta - and has selected 21 businesses to participate. The first part of the program, the 2019 Community Wealth Build Accelerator lead by The Guild, will teach advanced business fundamentals to boost business profitability, real estate basics to assist in acquiring commercial real estate and new economic models that will allow them to build community wealth.
Although the program is still in its early stages, Invest Atlanta intends to expand this concept beyond Pittsburgh Yards, based on momentum and interest from both local and national organizations. Accelerate Southside is an opportunity for Invest Atlanta to address issues of equity, small business ownership and wealth creation that are not only affecting Atlanta, but cities across the nation.