Development Magazine Spring 2016

Social Inclusion Best Practices: Forest City Washington

A national developer reaches out to the community to involve local residents and businesses.

FOREST CITY Washington is committed to building community with local businesses. The company is redeveloping a 42-acre waterfront site in Washington, D.C., known as The Yards. The nearly $2 billion mixed-use project involves 20 to 25 buildings and is expected to take 15 to 20 years to complete. The firm wanted to go beyond race and gender and take a more inclusive approach by bringing in small or disadvantaged local businesses.

According to Andre Banks, Forest City Washington’s director of social inclusion, the company’s social inclusion initiative has two major aspects:

Contractor Goals. To ensure local small contractor participation, Forest City Washington instituted a voluntary mentor/protégé program. Large prime contractors were encouraged to subcontract part of their agreements to small or disadvantaged local builders and trades. This is tied into a District of Columbia requirement that 35 percent of the contracts go to certified business enterprises (CBEs), which are defined as small, local or disadvantaged firms. The philosophy behind the program was “each one/teach one.” The goal was to create opportunities for small and disadvantaged businesses so they could expand their technical capabilities and grow their businesses into viable enterprises that can hire local residents and expand the city’s tax base.

Workforce Intermediary. Forest City became the first developer in Washington to launch its own workforce intermediary, an organization that acts as a broker to pair businesses with local residents seeking work. These jobseekers often include dislocated workers, disadvantaged young adults and the working poor. The workforce intermediary typically is made up of businesses, labor unions, educational institutions, social services agencies and faith-based and community groups. These groups work together to recruit, train, hire and retain employees.

headshot of a man

Andre Banks

The purpose of the workforce intermediary here was to understand the employment needs of the new Harris Teeter grocery store at The Yards, and to coordinate the efforts of local nonprofit training partners and pair those with District of Columbia residents seeking employment. Its goal was to recruit, train, place and retain local residents for positions at the store and achieve a 70 percent retention rate.

First Steps

For both its mentor/protégé program and its workforce intermediary entity, Forest City took two initial steps. First, the company brought in two consulting firms, Unique Staffing LLC and APB & Associates, to help set up both programs. Working with the consultants, Forest City put together a business plan to clearly outline these programs and their goals.

For the mentor/protégé program, Forest City first asked its prime general contractors to subcontract out a portion of each assignment to a small, local disadvantaged business. The firm stressed that this was a voluntary program, but asked the larger contractors to embrace its values and goals for social inclusion.

The company implemented a checklist of eight qualifiers to ensure mentor eligibility, including evidence of good standing with the city government and a developmental program to help protégés expand their core competencies. Forest City had a similar eligibility checklist for potential protégés and required contractors to provide references, financial statements and resumes of key personnel. For each project, the firm provided a list of five or six local companies that the general contractors could consider as subcontractor protégés. This sped the process along and allowed the contractors to choose the companies with which they worked. Finally, Forest City worked hand-in-hand with the smaller subcontractors to ensure they had the correct insurance and bonding.

For the workforce intermediary program, Forest City held extensive talks with Harris Teeter to understand its needs in terms of positions and employees. The developer partnered initially with 12 — a number later expanded to 30 — community groups, including churches, schools and civic groups to help identify the best possible candidates for new positions.

Forest City worked with a local community college to help potential employees through the job application process, and has continued working with local groups to help individuals and ensure job retention.

Progress Report

For the seven parcels and projects that have been developed or are currently underway, Forest City has met or exceeded its contractor goals, with 35 to 57 percent of the work at these projects going to CBEs.

The Harris Teeter store and local restaurants at The Yards have hired nearly 300 local residents, which represents a 1 percent reduction in D.C.’s unemployment rate. Eighty-two percent of those hired at the Harris Teeter store have stayed on the job for six months or longer.

Next Steps

The Yards is only about 20 percent complete; the neighborhood will eventually boast more than 20 new or redeveloped buildings. As the mentor/protégé partnerships develop, they often extend their work beyond the Forest City project, says Banks. “In some cases, we’re seeing these smaller contractors become the prime contractors for these projects, and that was the goal all along.”

Before joining Forest City, Banks served as compliance manager for the District of Columbia’s Office of Local Business Development. As a native Washingtonian, Banks explains that his father and uncles were born in Ward 8, one of the most impoverished areas in the city. “Our roots are here,” he says. “My father taught me to never give up on where we come from. My job with Forest City allows me to continue that legacy.”

Recognizing the success of the firm’s workforce intermediary, a neighborhood association has asked Forest City to continue the program for its upcoming movie/theater/restaurant project, adds Banks. He notes that Forest City is now marketing its program in the surrounding D.C. area. “Having learned the ropes, we now want to bottle and package this as a service to other developers and/or government agencies that are looking to have a competitive edge.”

Forest City’s Corporate Core Values

  • Integrity and openness.
  • Accountability.
  • Diversity and inclusion.
  • Sustainability and stewardship.
  • Community involvement.
  • Entrepreneurial spirit.
  • Teamwork.

This article is adapted from the NAIOP Diversity Resource Center. For more information, see the “Company Best Practices” section.

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