A veteran Minneapolis businesswoman next month will expand her growing business by renovating an abandoned building on the near north side into a much-needed adult and child day care facility that also will create 25 good jobs with benefits.
Gloria Freeman, a laid-off insurance underwriter turned entrepreneur 15 years ago, is the owner of Olu’s Home. Today Olu’s, an African word Freeman interprets as “praising God,’’ is composed of nine Twin Cities group homes that employ 100 and serve those with developmental disabilities, brain injuries and mental illness.
“We have a steady business, but we wanted to diversify into child development, and serve more of the elderly,” Freeman said in an interview. “Our first group home was in north Minneapolis. There’s a need here for the services and the jobs. North Minneapolis is the right place for Olu’s Center.”
Minneapolis-based Community Reinvestment Fund (CRF), Century Bank and the Metropolitan Economic Development Association have put together a $1.3 million loan package. Construction will soon start on an overhaul of the building at 1315 12th Av. N. The 18,000-square foot concrete structure housed The City Inc., an alternative school that closed in 2011.
“This is exactly consistent with our mission to improve the lives of disadvantaged people and strengthen distressed communities through innovative finance,” said Frank Altman, CEO of Community Reinvestment Fund (CRF). The 25-year-old community development lender is one of the few non-banks in America certified to make U.S. Small Business Administration (SBA) loans.
“Several banks saw Gloria’s plan as a risky new business, and we don’t fault them with all the rules and regulations they have to consider,” Altman said. “However, this minority-owned business has a great track record with residential facilities. We saw Olu’s Center as an extension of her long experience. We do this all the time around the country. Gloria expands her business, creates 25 good jobs in a renovated building in a low-income neighborhood and it creates opportunities for toddlers and seniors who need the service. It’s a double win for the local economy and community.”
Freeman also is benefiting from a new, national initiative of the Calvert Foundation and CRF that already has led to the fund making about $5 million in loans to small businesses that either aren’t big enough or lack the track record required by a commercial lender.
For example, about $525,000 of the Olu’s Center loan was used to pay off a mortgage to Sunrise Banks, which had foreclosed after The City stopped making mortgage payments.
New source of funds
Another new financial tool is the national “Ours To Own” program, which allows mom-and-pop investors to help finance local businesses in the Twin Cities and elsewhere. In the past, community development lenders such as CRF were dependent on capital investments made by banks, corporations and foundations. Now, through the Calvert-CRF program, individual investors can invest as little as $20 and receive interest through Calvert Foundation’s Community Investment Note program. (Details at www.Vested.org).
These investments will support CRF’s small-business lending program, which targets small business owners who have historically faced difficultly securing financing, particularly women and minorities.
The Twin Cities is one of five cities nationally in which Calvert is making the commitment. The national campaign is getting support from the Kresge Foundation and bankers PNC and Wells Fargo. The formal announcements will be made this fall. .
Freeman was introduced to CRF by her business consultant at the Metropolitan Economic Development Association.
“I want to create a fabulous service, create jobs and leave a legacy for my family,” said Freeman, who has a daughter and goddaughter working in the business. “We intend to make money, pay back the loans and be a good community business. This is how we help change the North Side.”
Neal St. Anthony • 612-673-7144 • firstname.lastname@example.org