If there’s one thing Ruby Reyes loves more than learning, it’s protecting and supporting opportunities for her community to learn together.

She gets to do both as part of the Boston Ujima Project’s member fund management committee, which reviews potential investments for the community-controlled social investment fund focused on uplifting Boston’s BIPOC communities. Each investment requires a majority vote for approval from the Boston Ujima Project’s voting membership, which currently consists of 240 people who identify as working-class or person of color or both, either living in Boston or have been displaced from Boston.

The Boston Ujima Project has made 10 investments so far. Most recently, in June, the group’s voting membership approved a $300,000 loan as part of a construction financing package for the Boston Neighborhood Community Land Trust to build a new six-unit affordable condominium on what is currently city-owned land adjacent to one of the land trust’s existing buildings.

It’s Boston Neighborhood Community Land Trust’s first new construction project, and its first project creating homeownership opportunities. It’s also the Boston Ujima Project’s first real estate investment, with the fund committing to more in the future.

With every investment, including this one, the Boston Ujima Project’s voting members have the opportunity to review a credit memo outlining risks and benefits of the potential investment while also digging deep into the finances of a given business or project. Ujima staff prepare the memo and present it to members for discussion and deliberation as part of the voting process.

“I think it’s important that it operates in this way because it provides the educational component,” Reyes tells Next City. “I’m a nerd. I love learning. For me that’s really important. The other important aspect is that most adults become individualistic because of the society we live in and it helps to create a space that is not about individualism.”

That’s the ethos behind investments in projects like a community land trust, which creates permanently affordable housing — meaning that even if a home in the land trust is sold down the line, it remains affordable to a middle-income household.

“Right now there are very few properties accessible to middle income folks because gentrification is on steroids in Boston,” Reyes says. “If you’re more on the individualistic side, then it doesn’t make sense to you. But if you’re on the side that this property is going to create that stability and provide that same opportunity to another household later on…then it’s a no-brainer.”

Investing in community and creativity

The Boston Ujima Project’s roots are in Boston’s Roxbury, Dorchester, Jamaica Plain and Mattapan neighborhoods — all predominantly working-class communities of color, the kinds of places where residents have long been left behind by the economy. Prior to officially launching, the project’s creators spent a few years hosting study circles and discussion groups hashing out how an economy that actually worked for them might operate.

Alternative models for ownership of businesses, housing or land came up often in those early discussions. It was something that spoke to Reyes, who grew up on a farm in the Rio Grande Valley of southern Texas but has lived in Boston for more than 25 years.

“Low income folks, usually Black or Latino, they’re the ones that are hit the hardest by capitalistic decisions,” Reyes says. “What interested me was the idea of more cooperatives being formed. I’m interested in really alternative models that don’t exist — or they do exist and they’re so small, maybe existed under the radar and just need more support, or just to have more of those models starting to exist in the world.”

They were interested in more than just talking about it. The Boston Ujima Project officially launched in 2017. Reyes was there as part of the group’s symbolic first vote in the courtyard of First Church in Roxbury.

On the organizing side, the group began meeting regularly to continue learning about alternatives while outlining visions for the economic development of their neighborhoods. For Ujima, that meant members of the group from each neighborhood making lists of existing local businesses they loved and wanted to protect or grow, as well as businesses they wished they had or investments they would like to make in their neighborhoods.

On the financing side, Boston Ujima Project created a democratically-managed investment fund, pooling $5 million in capital from more than 300 investors, with a minimum investment amount of just $50. Most were local investors from Boston or nearby.

Crucially, there were some larger investments that came in from wealthy individuals and institutions, some outside of Boston, even though none of them would qualify to have a vote over the project’s investment decisions. The fund was also structured so that, if the fund ever had to shut down, smaller and local investors would be repaid first.

The Boston Ujima Project’s first investment was in CERO, a worker-owned cooperative commercial compost hauler. Since then the group has invested in two restaurants, a bakery, a co-op grocery, a commercial kitchen, a boutique fashion brand, a production company, and even the Bay State Banner — a historic Black-owned local weekly newspaper.

“It’s about making sure low-income folks have not just access but also time and space to create,” Reyes says. “Our folks are super creative and brilliant but not able to be brilliant because they’re caught up in the hustle of 9-to-5 jobs and surviving is overwhelming. You’re not able to think about the possibilities.”

A risk worth taking

Formerly known as the Coalition for Occupied Homes in Foreclosure, the Boston Neighborhood Community Land Trust started out more than a decade ago as a group of tenants who were at risk of being displaced. They were all living in Dorchester and Roxbury, in a scattered set of triple-decker apartment buildings whose owners had gone into foreclosure during the global financial crisis. Speculative investors were going around the hardest-hit neighborhoods looking to buy up distressed properties en masse and start evicting everyone or jacking up rents far beyond what existing tenants were paying previously.

Read more: An Unusual Coalition in Boston Helps Save Homes from Foreclosure

The Boston Neighborhood Community Land Trust now has a portfolio of 11 buildings, totaling 32 units of housing, rescued from foreclosure in Dorchester and Roxbury. One of those buildings is next to a city-owned lot containing a long-abandoned auto-repair garage, located at 355 Park Street in Dorchester. The group had been eyeing the lot for community use, perhaps as a garden or other third space, but the abandoned building made it unsafe for even temporary activation.

Then in 2023, the 355 Park Street lot suddenly came up for sale. As part of the first phase of Boston Mayor Michelle Wu’s Welcome Home Boston initiative, it was one of 12 city-owned lots in Dorchester that the city was selling at a price of just $100 in exchange for redeveloping the lots as affordable housing.

It wasn’t quite what the Boston Neighborhood Community Land Trust initially envisioned for the lot. The land trust also hadn’t built anything new before, and its hands were full dealing with years of backlogged maintenance left behind by previous owners of its existing buildings. It would be a risk taking on some debt and the responsibility of seeing through the project all the way to selling the units to condo owners using the unorthodox community land trust ground lease structure.

The decision rested with the land trust’s board, which currently consists of five land trust residents, five other residents of the neighborhoods where the land trust’s properties are located, and three “resource solidarity” members selected for having relevant knowledge and experience to help the land trust operate. Mulling over all the above, the board decided to go for it — with confidence they were connected enough to the Boston Ujima Project and other potential investors who believed in both their mission and their model.

“We decided if it’s not us, it’ll be someone else,” says Meredith Levy, executive director of Boston Neighborhood Community Land Trust. “It wasn’t just a slam dunk. We went through a lot of vetting, we did a lot of risk mitigation, [asking ourselves] what are the things we can do to tighten up the risk? We spent a lot of time on that. A big one was working with this awesome group of impact solidarity investors so that we’re working with people who are with us, who are going to help us problem-solve as we go.”

In June 2024, the city selected Boston Neighborhood Community Land Trust and its partners at CoEverything, a worker-owned architecture and development cooperative, to build a new six-unit condominium at 355 Park Street. The first floor will include two ADA-accessible two-bedroom units, and the two floors above will each include a one-bedroom unit and a three-bedroom unit. Half the units will be reserved for residents between 81%-100% area median income for Boston, half for residents earning no more than 80%. That comes out to estimated sales prices of $334,700 for a 2-bedroom at 81%-100% AMI and $258,500 at 80% AMI.

“I don’t think this proposal is going to be a silver bullet, but it provides another alternative, another option, which to me is a plus,” Reyes says. “There isn’t a silver bullet to the affordable housing problem, but it’s going to be something that alleviates the bottleneck that’s part of the crisis.”

A model worth understanding

Financing for acquisitions, rehab or new construction has long been a roadblock for community land trusts across the country. With few exceptions, traditional lenders still balk at the model.

In a typical construction loan scenario, if a developer wants a construction loan to build a bunch of homes, the developer has to be able to show they’ll eventually pay off the construction loan by selling the homes to homeowners using conventional mortgages that involve the developer handing over property ownership to the buyers.

Under a community land trust, the trust doesn’t sell the land to homeowners, instead it sells them only the house that sits on the land using a long-term (typically 99-year) ground lease. If the homeowner wants to sell the house, they can only do so on specific terms set at the sale by the community land trust, terms that ensure the home will still be sold at an affordable price to the next buyer. Relatively few lenders have invested the time to understand how mortgages work under the model, and they’re mostly community banks or credit unions serving specific geographic areas.

If the construction lender hasn’t taken the time to understand how community land trust homeowner mortgages work — or if it doesn’t have a good relationship with any other lender who does make loans to community land trust homeowners — the lender won’t be comfortable making a construction loan to a community land trust because it doesn’t see a viable pathway for that loan to get repaid.

It’s a chicken-or-egg situation. Not enough lenders make construction loans to community land trusts because there aren’t enough lenders who make loans to community land trust homeowners; there aren’t enough community land trust homeowners because community land trusts can’t get construction loans to build community land trust homes.

Boston isn’t one of the few areas where community land trusts have ongoing relationships with conventional construction lenders, even though it’s home to one of the country’s most established community land trusts. Dudley Neighbors, Inc., founded in the 1980s, now owns more than 30 acres of land with 228 units of affordable housing as well as commercial space and green space in the Dudley Triangle portion of Dorchester.

“The real challenge has been just finding a stable source of funding that’s available and really understands the model,” says John Smith, executive director at Dudley Street Neighborhood Initiative, the nonprofit that administers the Dudley Neighbors community land trust.

The staff and members of the Boston Ujima Project did what most lenders haven’t shown a willingness to do. They educated each other about community land trusts — on top of educating each other about real estate financing and development.

In the months leading up to the vote, Ujima held educational sessions for members to learn about the model from legal experts and others. The credit memo that staff prepared for the membership touches on the civil rights era roots of community land trusts in America, starting with New Communities, Inc., established by Black farmers in Georgia in 1969. It went on to note there are now 314 community land trusts across the country, including 18 in Massachusetts and five in Boston.

“The presentation was really strong, they talked about what was going to happen, we’re building a building, you’re going to get paid back here,” Reyes says. “It really impressed me with how land trusts work, day-to-day as well as big picture.”

The vote to approve the loan to Boston Neighborhood Community Land Trust was 90% in favor. The $300,000 investment from the Boston Ujima Project is part of a combined $1.3 million in construction financing for 355 Park Street, with the rest of that amount coming from the Boston Impact Initiative and the Local Enterprise Assistance Fund — a local community development financial institution whose board includes Smith from Dudley Street Neighborhood Initiative. The city also allocated $1.8 million in American Rescue Plan Act funding for the project, and the Greater Boston Community Land Trust Network is also contributing a small slice of funding to complete the total $3.7 million in development costs for the new building.

Investing in land or real estate was part of the early vision for the Boston Ujima Project, but it didn’t surprise the group that it took nine other investments before finally getting around to it. The project has also just launched an initiative to raise a second investment fund that will focus exclusively on real estate.

“We anticipated that real estate was going to be, in terms of our democratic process, the hardest to get candidates for, just because of the nature of how real estate transactions happen,” says Nia Evans, executive director at the Boston Ujima Project.

“If you’re not in it, if you’re not a developer or financier, you often don’t know about these projects until they’re kind of well on their way, and you’re in the position of reacting to something that’s been pretty largely developed without you,” Evans says. “That’s been one of the drives behind Ujima in the first place, to have a different sort of process that includes community members from the very beginning.”

This post was originally published on Next City.