Kensington Corridor Trust
The First Four Years
3312 Kensington Avenue (with the orange awning), occupied by Vizionz Gallery, is one of the several properties KCT stewards. Photo by Luis Acosta Studio, 2020.
By Karen Black
This report is the fourth in a series of Nowak Metro Finance Lab City Cases, a set of case studies that will dig deeply into institutional and financing models that have driven large-scale urban transformation. City Cases seek to provide sufficient detail to enable large-scale adaptation and adoption and, over time, contribute to a new paradigm for financing inclusive cities by demonstrating how reorganizing public, private and civic resources in novel and creative ways can reshape local economies and remake local places.
Executive Summary
What is KCT?
Kensington Corridor Trust or KCT is a neighborhood trust started in 2019 whose mission is to acquire and redevelop real estate on a disinvested commercial corridor and place it into long-term community control to preserve culture and affordability while building neighborhood power and wealth.
What is unique about the KCT model?
KCT has an innovative trust governance structure that seeks to decommodify commercial and residential assets by taking them out of the speculative market and placing them under community control.
Why was KCT formed?
KCT was formed to address vacancy and speculative development on a neighborhood commercial corridor.
HOW IS KCT FINANCING THE ACQUISITION AND REDEVELOPMENT OF PROPERTIES ALONG THE CORRIDOR?
KCT set a fundraising goal of $2 million in non-recoverable grants to fund trust formation, operating costs, and community engagement efforts. It also sought to raise $20 million in patient, low-interest capital to fund the acquisition and development of 60 properties. Today KCT has raised $2.5million in grants and $10.85 million in loans at interest rates between 0-2 percent with a 30-year amortization term. Its investors are primarily philanthropic organizations rather than market based investors.
HOW DOES KCT PROVIDE COMMUNITY CONTROL OVER ASSETS?
KCT has established a 501(c)(3) nonprofit board comprised of community residents and small business owners and a Perpetual Purpose Trust Stewardship Committee made up of nine community members who are responsible for ensuring that board decisions further neighborhood control and preserve affordability.
WHY IS KCT’S MODEL IMPORTANT TO EXPLORE?
Cities are seeking new models for creating community power and control over neighborhood real estate development and for regenerating failing retail corridors in a manner that benefits existing residents. KCT seeks to prove that commercial districts can be improved while catering to the needs of existing residents.
WHAT IMPACT HAS KCT HAD?
As of Spring 2024, it is too early to show the impact of KCT. At that time, KCT controlled just 20 out of 627 properties on 1.4 miles of a deteriorated neighborhood commercial corridor. KCT also has received virtually all of its funding outside the market from philanthropy rather than private market investors with an interest in social impact. It is unclear whether this first infusion of funding is just the beginning or whether it will represent the bulk of funding the model will receive over the next ten years. KCT’s Executive Director feels strongly that it has the capacity, capital, and community standing to affect transformative change.