Q&A with Sarah Hale of Urban Hope

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As Executive Director, Sarah has overseen the development of a new affordable housing investment note that offers investors both a financial return and deep community impact.

Hi Sarah, in your article for the Virginia Impact Report, you discussed Urban Hope's new impact investment model. Can you share with us the terms of this new model?

It’s quite simple: Investors place their funds with Urban Hope for a five-year commitment and receive a promissory note and a 2.5% annual return that is paid out quarterly. There is a $20,000 investing minimum and we have a 13-year track record of providing financial returns and a positive community impact.

We do have some investors who have offered to give us even more generous terms. For example, one investor offered to take an eight-year note, with the first three years being an interest-free loan. This gives us a lot more flexibility, which we are always grateful for, but the 2.5% for five years is our standard offer to investors.

In total, how much money have your partners have invested with Urban Hope?

We have approximately $150,000 in new investor funds, and with our legacy investors who are converting to our new model, that amount grows to approximately $750,000. The total equity value of our portfolio is over $2 million.

How do you identify families and individuals who are ideal candidates for Urban Hope homes?

We have great success with personal referrals from the community through relationships and organizational partnerships. However, as we have grown, we have needed to expand our pool of candidates and our depth of understanding of their readiness for an Urban Hope property. So, we brought our financial literacy training in-house, and have a super successful curriculum that we created, which is tailor-made for our community. MoneySmart class is accessible to all who desire to grow in their financial literacy, and is especially recommended for those that want to be considered for Urban Hope housing or work to reduce debt while they are on our waitlist.

You also wrote about the economic pressures of accelerating real estate prices. How does this reality impact the mission of Urban Hope?

With our local real estate market being especially hot, we are pressed to be able to find properties that fit into our budget. Accelerating real estate prices also make our mission more critical because the markets create displacement pressures, incents landlords to sell, and there are homes being bought and renovated with only the higher income buyers as a target market.

We are committed to this geographic area of the East End of Richmond, as it presents a unique opportunity. In this very special location, we sit right in the middle of a triangle with heavy historic implications. At the top of Church Hill, we have St. John’s Church, where Patrick Henry famously said, “Give me liberty or give me death!” At the bottom of Church Hill, we have the former location of the second-largest slave market in the United States. And at our northern borders, we have four public housing communities which create the largest concentration of poverty between New York and Atlanta. These neighborhoods are the troubling fruit of decades of redlining.

With all of that as backdrop, gentrification is happening rapidly, displacing countless citizens, many of whom have called these neighborhoods home for generations. We have an opportunity to participate in the housing market in a way that aims at more just and equitable community change. We seek to provide opportunities for families to stay in place. Instead of further displacing communities of color, and continuing old systems that keep families from building wealth, we have an urgent opportunity to work toward a new, mixed-income, mixed-race community that could be a shining example of what happens when a community is committed to flourishing and the common good.

Investment in Urban Hope is not just a safe, steady investment; it is participating in bringing about justice in a place where some of our greatest injustices have been committed. It is creating a community of reconciliation and hope, one that can be an example to our entire nation.