ImpactAlpha, January 12 — Columbus, Ohio-based East Chop Capital, founded by a pair of Black real estate investors and developers, has rallied Black investors to back Black developers and aims to partner with Black realtors, banks, electricians, plumbers, housekeeping crews, cleaning companies and more as it acquires luxury vacation rental properties across the U.S.
“We’re looking to do that as our portfolio grows – helping them grow their businesses significantly,” East Chop’s Carrington Carter told ImpactAlpha. With its $4 million first fund, the private equity firm aims to acquire up to a dozen vacation homes over six months. At least 90% of investors in the new fund are African Americans, says co-founder Calvin Butts.
East Chop has a mission to bridge the funding gap, and provide other resources, for Black, women and minority founders while generating superior risk-adjusted returns for its investors.
The firm is already looking ahead for its next fund, talking with investors about an upcoming real estate debt fund this year that will provide debt financing for Black, women and other minority-owned real estate investors and developers that have been traditionally overlooked by traditional lenders.
Diversity in real estate
Maryland-based Community Enterprise Partners aims to tackle the low representation of Black and other people of color in the real estate sector — just 2% of real estate development firms are Black-led. The nonprofit is looking to raise $350 million, and catalyze $3.1 billion more, to diversify the industry. (see, “Enterprise’s Equitable Path Forward initiative“).