Development: What attracted you to a career in commercial real estate?
Adrian Washington: It is a passion to create, and real estate development is a super-creative field. You can take the raw materials like a piece of land. Then you bring together talented architects, designers, contractors and engineers. You put together the financing. You envision the project. If you are successful, you create something that is beautiful and that makes a permanent mark for the better on a community.
Development: Could you tell us about launching and growing Neighborhood Development Co. (NDC)?
Washington: We started out doing very small projects — single-unit buildings and brownstone renovations. Now we are involved with boutique condominiums, rental apartment buildings and some commercial projects. We develop our residential products for the entire spectrum of incomes: moderate- and low-income apartments to luxury.
Development: What were your greatest challenges in growing the company?
Washington: Finding and keeping the right people is the biggest challenge, because your success can depend on them. We identify people who are talented and good to work with. Then we try to retain and recruit talent while fostering harmony.
Development: The market has experienced tough financial challenges over the past 20-plus years, such as the Great Recession of a decade ago. How did you and your company weather those storms?
Washington: Those were challenging times, and I am proud that we worked through them. Part of it was strategic. We have always had a balanced portfolio working with both market-rate and affordable properties. During the past 23 years, it was sometimes very challenging to develop market-rate properties, but affordable housing was booming. The other part of it was keeping the company flexible. We have never waited around for the old days to come back. Instead, we’ve always looked for new product types, new financing sources and new partnerships.
Development: Could you expand on your concept of NDC as a triple-bottom-line real estate development company? Why is this important to you?
Washington: The triple bottom line is profits, planet and people. We are primarily a business, and if we are not profitable, we will not be around next year. So everything we do has to be fiscally responsible, earn a reasonable profit and be financially sustainable. We pride ourselves on being a leading-edge developer in terms of sustainability. Next year, we will break ground on our first net-zero project. The final part is people. We are respectful of the communities in which we work. We do a lot of work with affordable housing. Our commercial work is often mission driven, appealing to the neighborhood and serving the people who live in the neighborhood. We try to balance all three of those p’s — profit, planet, people. That’s what we are about.
Development: What is your primary role as CEO of NDC today?
Washington: Two things: one is a focus on the strategic direction of the company, and the other is relationships, internal and external. Regarding internal relationships, I am talking about getting good people, motivating them, working with them, understanding what they want and creating a climate in which they can succeed. As for external relationships, my focus is on investors, community leaders and members of government.
Development: What are your greatest challenges in leading the company?
Washington: The greatest challenges are reacting to changes in the world and the marketplace, while remaining true to our main strategy and our core competencies. Flexibility is critical.
Development: What qualities do you look for in hiring senior leadership?
Washington: We have been successful hiring senior people with decades of experience, as well as people right out of school with no experience in commercial real estate. For the senior positions, I want people who know the industry. For younger people, it is much more about their intelligence, drive, curiosity and willingness to learn.
Development: How has the pandemic impacted the company and affected your workforce and tenants?
Washington: The pandemic has affected the different stakeholders differently. For the company, we first went to working 100% remote. Then last summer we developed a hybrid model, which has worked out well. We have systems in place, cloud storage, Zoom capability and teleconferencing. In terms of our residents, it has been a challenge as many are lower-income. Many are the frontline workers, and they have been affected both in terms of employment in the beginning of the pandemic and in terms of health issues throughout. Sometimes people have had trouble paying the rent. When they tell us they cannot pay the rent, it is because they really cannot pay the rent — not because they don’t want to — so we work with them. As for construction during the pandemic, the supply chain for certain materials and products — such as appliances and light fixtures — has lengthened. Schedules have been pushed out, and it has been difficult to meet our construction timelines. We have some commercial tenants that have experienced setbacks, such as restaurants and daycare centers.
Development: How do you see 2022 shaping up for commercial real estate? Where do you see the industry going in the next few years?
Washington: Rising construction costs are a concern. It is driven by general inflation in the economy, supply chain disruptions and long-term labor shortages. People in the baby boom generation are retiring, and they are not being replaced by younger workers in the numbers that we need. So we’re trying to address that by looking at more disruptive, innovative ways to build.
Development: One of those ways is through a new system you are developing. Could you tell us about the formation of your latest venture, Platform LLC?
Washington: Platform LLC is a startup that I launched about a year ago, separately from Neighborhood Development Co. It goes to the point I made earlier about rising construction costs and lengthening construction schedules. A major pain point in the industry is the underground portion of the building — the excavation, the [concrete] shoring, ensuring the foundation, the site, the utilities. There was no real innovation going on there. What Platform LLC does is provide a single point of contact, one-stop shopping for everything underground. Our goal is to provide an integrated delivery system so that the building platform can be delivered faster, cheaper and better.
Development: What is the best advice you have been given over the course of your career in real estate?
Washington: The most important is to develop projects that you believe in. It’s got to be a project that you’re passionate about, that you want to build, because you’re not in this for the money; you’re in it because you love to build.
Development: What advice would you give someone entering the commercial real estate business today?
Washington: The advice I would give is along the same lines. Don’t come into this business thinking that you will make tons of money, that it’s going to be glamorous and easy. Come into the business because you love to see buildings come out of the ground. Have that passion drive you, because that is what it takes to be successful.
Development: What crucial lessons have you learned in the decades you have been in the business?
Washington: Work with good people and good partners.
Development: How do you de-stress during your off hours?
Washington: I love to read. I’ve always been an avid reader. I read a book a week. I like physical activities, such as working out, hiking in the warm weather and playing golf. I try to stay physically active because I think it’s good for your body and it’s good for your mind.
Ron Derven is a contributing editor for Development magazine.