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Caritas of Austin serves thousands of families and individuals annually, most of whom do not have a stable place to call home. The organization empowers people in our community to find sustainable ways to climb out and stay out of poverty and homelessness. When they found that research showed that keeping people from falling into long-term homelessness is more effective and 58% less expensive than the community’s cost of supporting homeless families, Caritas developed a business plan to expand its efforts to reach families in crisis before they become homeless.
In part to address the suburbanization of poverty, they designed a hub and spoke model to locate their much-needed services where the lowest income families live and work. While the main office downtown remains intact, providing client support for households centrally located as well as foundational, operational and leadership support, each spoke location will serve as a neighborhood resource to truly engage poverty where it exists.
“Austin has grown and changed tremendously over the past 10 years, and we knew we must adapt our services to address homelessness and poverty as and where it is occurring,” said Caritas of Austin Executive Director Jo Kathryn Quinn.
Research implementing this method has shown a more than 60% reduction in the likelihood of homelessness after 18 months. Based on demographic analysis, Caritas determined the first spoke should be located in the Rundberg neighborhood in North Austin. Currently there are more than 28,000 households living at or below income of $35,000 annually in this area.
During the summer of 2014, Caritas of Austin participated in Mission Capital’s Accelerator program, where they worked with mentors to build out a business model and scaling plan for their hub and spoke operations, as well as establish connections with Austin’s philanthropic community. In April 2015, Caritas successfully opened a satellite center in the Northgate Plaza. Executive Director Jo Kathryn Quinn credits the Accelerator for helping bring their vision to life.
In the process of developing the space, the organization saw an opportunity to think creatively about the broader community need. They noticed that some of the surrounding businesses clashed with their mission, for example a payday loan provider threatens long-term financial stability of some of the same people that Caritas serves. So when the opportunity to buy the plaza arose, the organization jumped on it. Caritas worked with Alori Properties to create a “philanthropic partnership” to purchase the building. More than $800,000 from 37 investors was raised in just a few weeks to purchase the property. Some of these investors were existing Caritas of Austin supporters, but many were drawn to the dual opportunity of a real estate investment with a philanthropic arm.
“Having a solid business plan in place and strong business connections in the community enabled us to move very quickly on this,” Quinn said.
The partnership is designed so that Caritas receives the immediate benefit of a rent-free space and a long-term benefit of eventually being able to purchase the building at the same price the partnership paid which will also result in a positive cash flow for Caritas programs. The investors earn a small return annually and get their investment back when Caritas purchases the building.
Quinn added, “Our ultimate vision is not just a real estate investment. It’s that this property could eventually become a hub of service providers and nonprofit organizations which serve this entire neighborhood.”
While Caritas provides important services, they understand the value of collaborating with other organizations to better serve the Rundberg community. Caritas hopes to build out the plaza as a service center for their neighbors in need by finding the right tenants.
“We are excited to be a north Austin neighbor. This community possesses great strengths and resources, and our hope is to become part of the fabric of this community with like-minded organizations at Northgate Plaza.”
If your organization serves the Rundberg population and you’re looking for a space in the area, consider reaching out to Alori Properties at 512-454-4663 or firstname.lastname@example.org about leasing in the Northgate Plaza.
Caritas North will serve as a pilot for building future spoke locations and reaching more neighborhoods. This type of risk taking, innovation and collaboration is just what Austin needs to begin addressing some of our city’s most complex social issues.[/vc_column_text][/vc_column][/vc_row]