5 Questions With Leon Walker| Housing Finance Magazine

Leon Walker has helped bring grocery stores and medical services to food and health care deserts on Chicago’s South Side. Now, his expanding work includes affordable housing.

Managing partner of real estate development firm DL3 Realty, Walker is also one of the co-founders of the Chicago Emerging Minority Developer Initiative (CEMDI), an organization that launched in 2020 to increase the number of minority developers active in the city.

How is DL3 different from other development firms?

I grew up on the South Side of Chicago, the son of two public school teachers. When you have teachers as your first models, they put something special, I believe, in your spirit and soul that says that you can help others and be well yourself. Do good by helping others. That has always driven my perspective.

Like so many people in my cohort, when you grow up on the South Side of Chicago or parts of Philly or Detroit or New York, when you grow up in these urban communities and we get opportunities to have education and work experience outside of those communities, we all leave. There’s a brain drain out of most of our urban environments. Like many of my colleagues, I went to college, the University of Michigan for undergrad and then the University of Chicago for law school and business school. After that education, I went on to corporate America in commercial real estate. I was at Citigroup in the real estate capital markets, and then I went to LaSalle Partners in its Los Angeles office, which became JLL. I was a young partner in 1999, and I voted on the merger.

In 2000, my dad got ill. He died that year of prostate cancer. I had a fork in the road. Here I was a junior young partner of this massive growing global enterprise. My next assignment was Singapore. It looked exciting. There was a fork in the road. I made a decision and reached back down to those roots. I came back home to our family business, took over the leadership. That’s how I got back involved in community development. My folks had focused on education and development. We built our first building from the ground up in 1979. They borrowed at 18% interest rates. I got my first hard hat on that job. They built a state-of-the-art education facility for 300 kids. Once I got that hard hat, I knew I wanted to be in the real estate business. I knew I wanted to be doing something to do good and do well. That’s been the guiding ethos of my career and our firm.

I did my first deal in 2005 after returning in 2000. The first few years I spent really working on my parents’ business and getting my arms wrapped around that. I was a kid that grew up in the business, and here I was coming back as this suit-and-tie JLL partner to the South Side dealing with 160 staff persons and 1,000 kids.

DL3 is a successful commercial developer. Why did you decide to add housing to your business plan, and how does housing fit in with your overall community development strategy?

We said we have to have to a two-handed, two-fisted approach here. You just can’t bring the jobs and retail without bringing the housing. On the other hand, you just can’t bring the housing without the jobs and retail. You have a Catch-22. Too often and for far too long the affordable housing program has been delivering housing but hasn’t looked beyond the four walls of those housing buildings to see how they are impacting the neighborhood. On the commercial side, you can bring the retail and services, but if we don’t have the backs to be clothed and the stomachs to be fed then the retail can’t be successful. It just makes sense. I’m driven by need.

In 2016, when we opened to national fanfare Starbucks, Chipotle, and all these great retailers in Englewood, I said, “Where’s the housing? Where’s the density?” I’m waiting for that to happen, so a need was presented. We meet needs. That’s the fundamental way to build a business.

Is it correct that you have three affordable housing developments in the works?

We’ve closed three deals—two 9% low-income housing tax credits deals and a 4% credit deals. That’s about 300 units. Right on those heels, there’s another 700 units in the pipeline. We’re doing it in a way that’s part of a bigger plan. In Englewood, we’re adding 100 units to the Englewood Square development because we have to deliver on the housing. The community wanted housing. Our project in Woodlawn, where the Obama Presidential Center is being developed, is going to have 58 units. That was our first deal and is in construction now with our partner, Michaels Development.
I didn’t just go into this business trying to just glom it on to our existing commercial work. We built a vertical. Tania Kadakia is leading that vertical. We have a housing group within DL3 that’s focused on housing.

Why is it important to have diversity in real estate development business?

Blacks represent less than 2% of the commercial real estate industry. There’s a very low participation. Why is that? It’s a capital intensive business. Where are people going to get resources? I was fortunate. I come from a family that built their first building in 1979. I had seen the process. I worked in corporate real estate. I had built up some resources.

Despite all of those challenges, we still need to bring more diversity in. I think having context, having developers come from the neighborhoods that they grew up in, makes a difference in terms of the delivery of the product and the commitment to those residents.

How should the industry support Black, women, and other underrepresented developers?

First, let’s start with the mindset of intentionality. It’s not going to happen with just nice words. There needs to direct action and intentionality. We need a commitment to keeping this issue front and center and not just a moment in time.

With two colleagues, I helped start CEMDI that’s being intentional about accelerating the efforts, the business plans, of emerging developers here. We have an accelerator, a roundtable, we connect and convene and bring capital to developers. We need all of those things.