“Making Gary Great Again” is more than profits and payroll
As many of you know, it is my professional mission to flip my hometown of Gary, Indiana. In the town’s heyday, the city was the second largest in the state. It was home to a booming steel industry, a diverse and thriving population, and a beautiful lakefront community on the shores of Lake Michigan. Unfortunately, Gary’s fortunes hinged on the steel industry, and in the 1960s the city started a downward spiral as the U.S. steel industry downsized thanks to competition from overseas.
Gary tried to bolster its flagging economy with major construction projects but failed to reverse the decline. In the late 1990s and early 2000s when the public school system revealed it had millions of dollars missing from its budget, was taken over by the state, and ultimately closed a number of the schools, it felt like a death knell for the community. A large portion of the population and a lot of the people and companies who had been investing in Gary packed up and left. It was a hard time, but in some ways, it changed Gary in ways that opened a door, decades later, for an influx of creative investing that characterizes the housing market and the Gary economy today.
Ideal for Impact Investing
In some markets, when a series of negative events like those that hit Gary between 1960 and the end of the 20th century occur, it means that area is essentially “over.” At this point, most municipalities flounder for five or six decades, but it becomes clear relatively quickly that things are bleak.
Not so in Gary.
Thanks to the city’s unique geographic positioning, it is poised to make a recovery from its downward spiral if community investors can envision its potential in the market. This is where impact investing comes in — and where it can work in other communities as well if there is creative investor leadership ready to take the reins. Gary needs visionary entrepreneurs to make strategic investments in the area to bolster the economy in practical and pragmatic ways while also demonstrating to other investors exactly what is possible in this market. This is known as impact investing, and it is an often-misunderstood concept in real estate. Impact investing is often confused with “socially responsible investing,” another valid but often less viable investment strategy for real estate investors.
- Impact investments are made with the intention to generate positive, measurable impact along with financial return.
- Socially responsible investments are made to endorse certain behaviors or corporate practices based on a predetermined set of ethical guidelines.
Although both types of investments can be profitable, only impact investments are most effective when they generate returns for the investor because then other investors see the benefits of the investment or the locale and bring their own capital to the cause.
Gary is the perfect place for impact investing because it is easy to see why, how, and to what degree your impact investments are successful. Gary is geographically unique because it is a real transportation and shipping hub. It is highly affordable, and it has a population of active, creative entrepreneurs dedicated to keeping their businesses in the local economy. This is the ideal place for real estate investors to place capital because the returns can be measured and impactful.
3 Examples of Creative Impact Investing in Gary
- Accelerated portfolio-building due to highly affordable investment options for both single-family and small-multifamily investors benefits investors and local neighborhoods by reducing blight and creating desirable, affordable housing.
- Actionable trend-spotting as public and private entities support new initiatives, such as the Hard Rock Casino slated to open on New Year’s Eve 2020, be completed by 2022, and predicted to create 1,000 new jobs immediately and nearly 2,000 when the casino and hotel are both complete. This growth comes on top of the Amazon distribution center in Gary that opened more than a year ago and has created more than 500 jobs. This type of growth affects the broader housing market and enables creative investors with the goal of making an impact to “get in early” in appreciating areas.
- High-level networking on a national level as impact investing necessitates sharing goals and visions for an investment with others in order to further support the community. In Gary, the annual Community Go-Giver Event (CGGE) hosted by the Good Success Mastermind brings more than six dozen creative entrepreneurs and real estate investors to the community to exchange ideas and make immediate, actionable investments in local businesses via the event’s signature “Make Your Day Wednesday,” which involves making one-time donations to meet specific needs in the community while identifying areas of interest for further investment.
For the truly creative real estate investor, impact investing can be the most rewarding investment strategy available. Not only does effective impact investing create a growth environment for your assets; it also creates a growth mindset that will enable you to be more creative – and often more profitable – than you ever dreamed possible.