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This new development will ask buyers to invest in a fund to give back to the community

Alloy Development’s new building in Dumbo will ask condo owners to make a donation to the Brooklyn Community Foundation and help make decisions about where in the community the money should go.

This new development will ask buyers to invest in a fund to give back to the community
[Photo: courtesy Better Brooklyn Fund]

When a new condo development opens in Brooklyn’s Dumbo neighborhood in late 2020 or early 2021, residents will get a unique request when they move in: an invitation to donate to a new philanthropic fund to support social causes in neighboring communities.

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Called the Better Brooklyn Fund, the first-of-a-kind fund is a collaboration between Alloy Development, the developer behind the building, and the Brooklyn Community Foundation, a public foundation that will administer the fund. When the developers approached the foundation about the idea, the foundation immediately recognized the potential.

[Photo: Better Brooklyn Fund]
“Brooklyn is gentrifying very rapidly, and real estate developers are everywhere,” says Cecilia Clarke, president and CEO of the Brooklyn Community Foundation. “I think a lot of people have spoken about, ‘How can developers give back?’ or, ‘Do developers support their community?’ Usually, honestly, my answer has been ‘no’—we haven’t really partnered closely with developers. And so this is an opportunity for a developer to kind of break out and say, ‘Well, we’ve created a model that we think could work that would sincerely give back to the community.'”

Alloy Development has worked in Dumbo for the last 13 years; the cofounders themselves live in the neighborhood and realized that some people moving into new developments want to be part of the community and help support positive change in areas ranging from justice reform to immigration rights and education. In the new fund, a committee of building residents will choose local nonprofits to support, with guidance from the Brooklyn Community Foundation. By creating a structured process, the developers believe that people who are interested in supporting the community will be more likely to actually act. “I think an organized infrastructure around a common value set has a more purposeful outcome,” says Alloy Development CEO Jared Della Valle. “Providing the structure, providing the meetings. As individuals, it’s easy for life to happen. But as a collective, I think people end up participating and engaging more, voicing their opinion, and actually having a vehicle to achieve their goals.”

[Photo: Better Brooklyn Fund]
The projects will be located throughout the borough, rather than only Dumbo, which is both a relatively small neighborhood and already wealthy. (While expensive development throughout Brooklyn has led to displacement of black and Hispanic residents over the past couple of decades, according to a report earlier this year from the National Community Reinvestment Coalition, Dumbo itself was mostly an industrial neighborhood, where old warehouses and factories were transformed into pricey lofts.) The developers wanted the fund to have the flexibility to work on issues throughout the broader area.

The company is aiming for the fund to be seeded with $1 million; the building has 46 condos, the majority of which will be listed at between $1.5 million and $3 million . The developers see an even larger potential for something similar to happen in other buildings throughout the city, where around $20 billion in real estate transactions happened in 2017, and $17.8 billion in 2018. “One percent of $20 billion dollars—$200 million a year—that’s an enormous potential engine to tap into,” says AJ Pires, president of Alloy Development. “And so to a certain extent, the legal and infrastructural opportunity of articulating a way to do that was exciting.” The company is hoping both to add more of its own developments to the fund, and that other developers copy the template.

“We’re looking to set an example for the rest of our industry about the potential of their work and the built environment—that we not only build buildings, but we make homes and we build communities at the end of the day,” says Della Valle. “And that really the development community needs to start taking responsibility for the health and success of our city from a number of different lenses.”

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About the author

Adele Peters is a staff writer at Fast Company who focuses on solutions to some of the world's largest problems, from climate change to homelessness. Previously, she worked with GOOD, BioLite, and the Sustainable Products and Solutions program at UC Berkeley, and contributed to the second edition of the bestselling book "Worldchanging: A User's Guide for the 21st Century."

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