AJ Jackson 00:00:35  Sure. Thanks, John. It's great to great to be here. you know, Leo is different in a in a couple of ways, but I'll get to the to the why? First, I think. Sure. That's a good question. when we launched the housing initiative, you know, we had an idea and maybe a half baked PowerPoint. So we've taken that and grown it to a portfolio. Now that's over 3000 units. We've done investments in D.C., Maryland and Virginia. And we frankly gotten to a scale that it made sense to consolidate our asset management, portfolio management, investment, the impact measurement and reporting all the functions around impact investing under a single platform.

AJ Jackson 00:01:15  Whereas as we had grown, we had taken, we'd been working with other parts of the JBG Smith organization and using resources from different teams as we as we needed them. We got to a scale where it made sense to consolidate that. talking about the the growth of the strategy based on what we've been able to do in the impact pool, we've seen that there is a real need for additional investment in workforce housing. And I know we'll talk about this a little bit later, but there's some different ways in which we want to we want to do that. And as we think about raising new capital to make further investments in workforce housing, one of the things that became clear to us was we needed to have a consolidated entity that was responsible for executing on the strategy that we were asking people to invest in. And so for those reasons, we consolidated all of our existing operations under the new wholly owned subsidiary, Leo Impact Capital, which is really exclusively focused on the impact investing work that JBG does.

John Coe 00:02:19  Is that a for profit enterprise or is that a nonprofit?

AJ Jackson 00:02:21  It is a for profit enterprise.

AJ Jackson 00:02:23  I mean, our our fundamental belief around impact investing and around a housing affordability is that you've got to move private capital at scale in order to really have solutions that are equal to the scale of the issues that we're trying to address. And moving private capital exhale means that capital has got to generate returns. It's we've got challenges that are bigger than philanthropy alone or government alone can address. So we've got to figure out how to turn private capital towards them. So we've been in the the for profit business, if you will, since, since the very beginning. having said that, we've also been and we talked about this with the Washington Housing Initiative, but been very focused on the role that nonprofits and philanthropy can play in helping to address some of those issues. We think about it kind of as a three way partnership, a public, private, philanthropic, partnership. And so we do a lot with nonprofit affordable housing investors and the impact or, operators in the impact pool. We work closely with nonprofits. We hope to create the Washington Housing Conservancy.

AJ Jackson 00:03:27  But Leo is a for profit entity.

John Coe 00:03:29  Okay, great. So before we dig further, let's go back into your origins, youth and parental influences. JJ, if we could. Sure. Where did you grow up and what influences did your parents have and family on you?

AJ Jackson 00:03:41  so I grew up in, Columbus, Ohio. until I was in, until I was in eighth grade, in which I went down to, to Alabama for school and right out of Birmingham, a little town that's now called Indian Springs. It was called Helena, spelled like Helena, Montana, but called Helena at the time. but so between Ohio and Alabama and, my parents are both retired educators and did that essentially for their for most of their careers. My father was was briefly in the corporate world at Westinghouse, but, he, did a junior achievement program, and got the teaching bug out of being a junior achievement, mentor. And so left Westinghouse got into teaching, and they both did that. They're both now now retired.

AJ Jackson 00:04:29  you know, retired teachers. And so, obviously the value of education was something that was just everywhere, I won't even say drilled in because it was never really drilled and it was just in the air always, you know, from when I was, from from when I was growing up, you know, and the and the, the importance of contributing to the community, giving back, being a part of of, you know, sort of the change you want to see in the communities that you're, that you're involved in. There are no they're actually from Cleveland. They met at Ohio State. Okay. So, my, my, mother actually did her undergraduate at Kent State, but she was at Ohio State, for summer program. I met my dad, who did both his undergraduate, and, got a master's from Ohio State, as well.

John Coe 00:05:19  Did he teach in the high school level.

AJ Jackson 00:05:21  Or what he taught? No, he taught primarily at the community college level. Oh, he did teach at Ohio State a little, but he taught primarily at a school, that used to be called the Columbus Institute for technology and is now called Columbus State.

AJ Jackson 00:05:37  but very similar to Montgomery College. and I think he really, that really resonated with him. I think because, you know, he was the first in his family to go to college. He had gone to a community college in Cleveland before he went to Ohio State. And I think he always felt like he could really see in the students the impact that he was having, the transformational nature of, of of education. And so, you know, as, as, as he used to always say, you know, I would do this for free. he really loved it.

John Coe 00:06:12  So that's awesome. So you grow up in the shadow of Ohio State and you go to Alabama. So tell me why how that happened.

AJ Jackson 00:06:21  you know, I'd been in Alabama. I went to, like I said, to Indian Springs, and, I actually had no intention of going to Alabama. When I was thinking about college, I wanted to go either to the East Coast or to the West Coast, and I was going to go to USC or NYU.

AJ Jackson 00:06:38  and there was a recruiter from Alabama who just sort of kept at me and kept at me and kept at me. but ultimately, what made it an easy and easier decision was, they offered me a four year full ride. and, and a year of housing and some other, some other benefits. And so the thought of going to NYU and working and coming out of school after working all the way through school, with a significant amount of debt, or or in similar at USC or going to school and coming out completely debt free was just really appealing to me. How did they find me at the time? no, it was, I had been a National Merit Scholar. And so they get the list, you know, and they just kind of stay on. They stay on you. and it ended up actually being a remarkable experience. because I'd been the I was at a small private high school, that was is very much kind of, an amazing place, but but but very much not the real world.

AJ Jackson 00:07:48  and so the University of Alabama is a large public university. and so it just really the exposure to sort of a broad breadth of people experiences, ideas was just really, you know, I think something that that, I didn't expect that going in and it was probably one of the biggest benefits of the university. that and the fact that, you know, it's a big enough school that you can find a critical mass around whatever you're interested in, which is one of the, I think, one of the benefits of larger public universities. you know, if you're into your one thing and you know it and your small school has it, then that's that's great, but but, but in a big university you can kind of bounce around, find different things, do different things. Sure, there's a lot of fun.

John Coe 00:08:34  It's a lot of fun. Well, Columbus, Ohio State's one of the three largest universities in the country.

AJ Jackson 00:08:38  Physically, Ohio State is very big, and I, I, it's, yeah, it's it's it's very big.

AJ Jackson 00:08:45  You know, I didn't want to go back to Columbus at the time. Columbus was much sleepier than it is. It is now. It is now. so. Yeah.

John Coe 00:08:56  Okay. So Alabama, what did you study down there?

AJ Jackson 00:09:00  I studied economics and finance. Interesting. so I in Alabama was interesting because you could take economics either in the business school or through the College of Arts and Sciences. Sure. and all of the core classes are exactly the same. The difference is the electives. Right? And so in the business school, the electives are thing at the time were things like, you know, using database software. And sure, I don't know, I don't know, things like that that were not particularly interesting to me. The College of Arts and Sciences, you could basically take whatever you want. and so I did econ and finance, but then I took everything I could, could take sort of beyond that, took a lot of Latin, took some Swahili, took some interesting women's studies history.

John Coe 00:09:47  So your parents.

AJ Jackson 00:09:47  Really, you know.

John Coe 00:09:48  Through education at you from the get go.

AJ Jackson 00:09:51  They, they they did they really did throw it at me. And I didn't mention this earlier, but one of the other benefits of Alabama in high school, I've taken a lot of AP, so I had 20. I'm gonna get that number on 2520. I basically had a freshman year as place.

John Coe 00:10:05  Credits you.

AJ Jackson 00:10:06  Play stuff, and so you could go straight to the interesting classes. There you go. Right. And so it was really just, you know, the, the, the epiphany I had in college, I realized after my, my freshman year, I said, you know, I've got enough credits from the AP. I could graduate in three years and be out of here. and then I said, but they're going to pay for four, so I could do that, right? Why not have a little fun? So why would you do that? And so it was really just this opportunity academically to just takes all kind of stuff and explore and do interesting things.

AJ Jackson 00:10:38  And it was really, you know, I was really fortunate to have that kind of, experience.

John Coe 00:10:44  So when the fourth year came, what were you thinking about?

AJ Jackson 00:10:48  when the fourth year came, I was actually thinking about, investment banking. Actually, I was thinking about investment banking. I like kind of the deal finance aspect seemed interesting to me. You know, it's economics that interests me. Finance is basically applied economics. Right. and so that was interesting. But I had spent all through high school and college. I'd been involved in politics and state and local level, doing various things. And so, as I was graduating, I reached out just to a couple of my, political contacts because the other thing that was interesting to me was coming to DC. my father had worked in DC before he went to college. I worked for the post office, actually. And what's now the museum there? Sure. where they actually used to unload, unload and sort mail there. Right. and so we'd come to DC a lot.

AJ Jackson 00:11:42  when I was, when I was growing up. And I'd always liked the city. and so that was kind of, that was calling to me on the one hand where the finance was calling. On the other hand. Ultimately, I got an offer from a guy that I had known I'd worked with before, who at the time, who had become a chief of staff to a member of Congress to come and work on Capitol Hill. And I thought, well, you know, I'll go and do that and see what happens. And typical, postcollege, fashion, Ohio. this was an Ohio guy. This was a guy. The congressman was a guy from southern Ohio down along the West Virginia border. but, and this guy named Frank Kaminsky since passed away, but, so I got the chance to come to Capitol Hill and work for Frank Crimmins. and so I did that, and I came, and he was up for reelection, and he lost. so I worked for him for kind of 6 or 9 months, and I was like, okay, that's over.

AJ Jackson 00:12:36  And then I'm going to go into back into finance. Right? So, polishing off my resume and sending it out. And I got a call from a guy who was the chief of staff to, what would have been my hometown congressman in Columbus, a guy named John Kasich, who went on to become governor of Ohio. And, he was chair of the budget committee at the time in the House. And they said, hey, we'd like you to come over and, do his it's called be his budget associate, which is basically do his committee work on the on the budget committee in the House. and so I went over to, to Kasich and did that, and was there for almost almost five years. And it was really just a fantastic experience because John Kasich was, you know, I've had this real, fortune of working for great people throughout, my, my career. And it's really kind of been the the secret of, of my success. Such as, such as, as Ben has really just been working for great for great people.

AJ Jackson 00:13:37  And so, John Kasich was a terrific member of Congress. Smart, hardworking, sort of problem solver, wanted to fix things, get things done, and incredibly bipartisan. you know, his his best friend was a guy from California named Ron Dellums, who's a liberal Democrat from Oakland and the sharpest dressed member of Congress you've ever seen. but John would work, you know, he'd work with anybody to try to solve a problem. And he was open to compromise, and he wanted to get things done. And so it was just a phenomenal experience, would.

John Coe 00:14:10  Be needed.

AJ Jackson 00:14:10  Today. It's, you know, it was a different, this is a different Capitol Hill. I don't think I would ever want to go back. and, you know, I don't know. Yeah. I don't think I'd ever want to go back, but, But it was nice. It was a really. It was a kind of a really special time. and I learned a lot. But we got to do also, I mean, we balance the budget.

AJ Jackson 00:14:36  So. So when he.

John Coe 00:14:37  Left and he ran for governor after that, then. Right.

AJ Jackson 00:14:41  He ran for president twice, but he left in 2000. he ran for president 2000 very, very briefly. He was out before the Hampshire primaries, but he was retiring in 2000 anyway. He'd been there 18 years and basically said, I've done all I can do. So he left. and I'd known that he was going to leave. So I'd applied to business school and I was going to go to business school. I actually, this is this is one of the serendipitous things. I don't know how I got in this list because I hadn't taken the GMAT. I hadn't done anything. I got a card about an MBA event here in in D.C. and there's a woman there, all a bunch of folks who want gone to the Harvard Business School talking about their their experience there. I was like, that sounds interesting. That sounds like something that would be, would be fun to do. And it was interesting because none of it was actually about business.

AJ Jackson 00:15:35  Harvard's motto is we educate leaders who make a difference in the world. and it's like, well, that that's appealing. so I'd applied to business school. I had been admitted. but business school started in, I don't know, JuneJuly. Kasich's term ended in January. and so I was trying to figure out what I was going to do for six months. you know, Capitol Hill is not. It's not investment banking. So I wasn't going to travel the world like I found that all my other classmates did before they showed up at HBS. so a guy that I knew, was working on the transition team at the General Services Administration, this was after the presidential election in 2000, before the inauguration in 2001. He said, I need someone to come over to the GSA who knows something about Capitol Hill, and help on what they call these parachutes teams, which it's basically a short term job to help with the transition. So I did that fully expecting I was going to leave in June and go to business.

John Coe 00:16:33  School between Clinton and Bush.

AJ Jackson 00:16:35  This was between Clinton and Bush. This was in 2000. and so, as you recall, it started late. and so, there's a little yeah, there's a little controversy around the transition, but, I went to GSA, I was in the congressional, affairs shop and helping with the transition. And I basically my primary task was putting together briefing materials for the incoming administrator who hadn't been named or nominated yet. But what I got to do in putting others materials is basically go all around the agency and talk to all the senior leadership and all the different groups, find out what was important to them, what they were working on, what they wanted to see done, what hadn't worked. And we put together these these binders, right, these giant, giant binders back in the day of information. And so it was my first exposure to GSA was my first real exposure to real estate. I thought when I applied to business school, when I was still on the hill, I thought I was going to be a management consultant.

AJ Jackson 00:17:36  I had no real thought about about real estate. but, you know, GSA does a lot of things beyond real estate. And so you got to kind of learn the whole agency. So when the administrator was finally nominated in April, I managed his confirmation process. and then managed his kind of kind of onboarding. But again, all the time thinking I'm leaving unexpectedly, the GSA inspector general retired. this guy, he'd been there forever. He was on Eisenhower's Secret Service detail. Been there forever. He retired. The person who was chief of staff was nominated to be the inspector general. And the administrator said, I think you should be the chief of staff. I said, well, I'm leaving. He's like, I didn't. I think you really should reconsider. I think you should really reconsider. and so I did, I said, this is just too great an opportunity. Can't pass it up. And so I was the chief of staff at the General Services Administration. Cool. put off Harvard, and then ultimately went, went, went later.

AJ Jackson 00:18:37  and that was really my first exposure to, to real estate and working on some sort of, you know, complex, large, high level real estate issues, with the, with the federal government, in addition to all the other stuff that, that, that, that GSA does. so it was a it was a phenomenal, phenomenal experience. being at the GSA.

John Coe 00:19:00  Yeah. Well, what did you learn? I mean, you learned about, obviously, how government interacts with the with the private sector, right? As far as the pieces and the structure, the interface with Congress, which is important, the Gao and the executive branch. Now, I've interviewed Dan. Dan,

AJ Jackson 00:19:21  Oh.

John Coe 00:19:22  no. No. he was in the Trump administration. He was that GSA had, got just name just escapes me anyway, you know, so I got a sense of that that that role is and he was in Congress himself for probably 15 years or so understanding and working in the in the committees. Yeah.

John Coe 00:19:42  So he knew how the the funding process worked and all the different. It's a complex.

AJ Jackson 00:19:48  Entity. It is a complex entity. I mean, the great thing about the GSA, there were a couple one, there aren't a lot of political appointees. There's the administrator who's confirmed by the Senate, and there's the inspector general who's confirmed by the Senate. And then there are, you know, a couple dozen, including all the regional administrators, actual political appointees who are politically appointed but not confirmed by the Senate, including the chief of staff. So it's relatively small. At the time, it was about a 15,000 person agency. It's a little bit bigger now, but a relatively small political cadre. So a lot of interface independents with the career, with the career staff, 1 or 2. Most of its money is not appropriate. It collects, rents. It charges fees for the things that sells. Kind of like an Amazon or like. Right. And so a lot of the money is not appropriated, which, keeps Congress less involved than in other agencies.

AJ Jackson 00:20:42  and three, it's a sub cabinet agency, which keeps the white House less involved than a lot of other agencies. So it was really a great place to have people, again, like John Kasich, that model who wanted to do something and get something done, who had less political interference than, you know, my friends had who were either in the white House or in cabinet level agencies. You could actually kind of do a lot. and as long as you don't embarrass the administration or break the law, generally you're going to be left alone. and that was a real gift in the, in the GSA. I think the thing that initially most surprised me, which is embarrassment, but it most surprised me was the incredible, dedication and professionalism of the career staff in the GSA. I mean, I think there are really some remarkable people in that agency who, are committed to public service, and who have made a career out of out of, out of doing really kind of, you know, back office and behind the scenes work on behalf of the American people.

AJ Jackson 00:21:43  And that was was really, you know, not what I was expecting going in and sort of not what, you know, the stereotypes may be about bureaucrats, but I, I found none of that, certainly at the senior level, found none of that. but then the politics, you know, the where the politics really get involved is in the real estate projects and the, the, the skill for the thing that has been most valuable out of all this was GSA builds courthouses, right. And so, courthouses, each courthouse is in a district. The district has a chief judge. as you may have learned from, I'm just a bill. Judges are appointed for life. And so you have someone who is essentially the prince or princess of a fiefdom, who cannot be replaced, who will be there until their heart stops beating. these are federal judges who may or may not, be on board with what? You you know, where the courthouse is going to be built, how the courthouse is going to be designed, what the size of the court.

AJ Jackson 00:22:51  They have their own desires about what they want, essentially as the palace out of which they're going to operate as the, you know, the Duke and Duchess of their little of their little fiefdom. And so the skill of working with learning how to work with and build relationships with these, judges, chief judges, so that you could actually advance courthouse projects consistent with sort of broader administration policy, broader, broader objectives. That's really been, I think, the most transferable, relatable kind of negotiation and relationship building, building skill, you know, because nothing, you know, in the administrator's office at the head of the agency, the chief of staff level, it's just like any other sort of senior job. Nothing is coming there unless it's a real issue. Right. And so it was it was always seemingly intractable, situations that you were trying to, try and trying to get resolved. and so that skill and then similarly working with the Office of Management and Budget, trying to get major federal federal buildings built, one of the projects I worked on was the Department of Transportation headquarters, which ironically, JBG built and recently sold.

AJ Jackson 00:24:00  But getting that lease approved through OMB was, was a real master class for me in negotiation and in really understanding how to take the perspective of someone else and, and then bring the argument to bear in a way that would resonate with that perspective so that we could get the lease approved. And in the case of OMB, it wasn't recalcitrance. It was that there were very specific rules in the federal government. The government can't sign capital leases, right? You can only find an operating lease if you're the government. however, the government wants to build the buildings that only it's going to occupy.

John Coe 00:24:41  Can you explain the difference between a capital and operating lease?

AJ Jackson 00:24:44  So a capital lease in the in the government speak is essentially you're buying a building over time, right? You're paying 100% of the value of the building. I'm you're just going to it's basically a financing mechanism for something that you essentially own, although you don't actually own it. Right. But you're essentially taking the value out there, almost like a sale leaseback, right? Whereas operating lease is like what a commercial tenant would sign in a building where I'm going to come in, I'm going to take 200,000ft², and I'll be here for seven or 7 or 10 years or whatever.

AJ Jackson 00:25:14  The government wants to build headquarters buildings for its agencies. It wants to occupy them exclusively. It wants to have control of them for 20 plus years. But it's legally forbidden from signing capital leases. this would present a problem. So? So the figure out how to think about, like in the case of Dot, how to think about the fact that because of our design guidelines, that building would be open to the public, we were going to put a Starbucks into the ground floor. We were going to allow, we were going to allow, third party commercial parking. What cost in the building of this building and what revenues could we pull out that were not really related to the Department of Transportation's occupancy, so that we could meet the threshold for the lease to be operating or operating or not and not capital, and do it. It's a lot of calculus, but but I mean, we're not pulling the wool over anyone. You're doing it in collaboration with OMB. but it is really about understanding their perspective and then trying to present data and evidence in a way that works within their perspective to to get them to say, okay, yeah, we want we want to do this because the reality was, Congress was the reason that the government doesn't sign capital leases, because if you sign a capital lease from a budgetary perspective, you pay for the whole thing when you sign it.

AJ Jackson 00:26:35  So an operating lease, you pay a lease payment every year. So from a budgeting perspective, the government doesn't want to take the hit of building a new building up front. Well, yeah.

John Coe 00:26:43  I mean, if if the government would take a private sector approach to finance, it would be a whole different government.

AJ Jackson 00:26:49  Well, yeah, I mean, it was one of the great frustrations. That was one of the great frustrations. Yes. I mean, we should, you know, in my view, we the government ought to be, either building and owning or selling and leasing back assets that it's going to occupy, like headquarters for long periods of time. It would be cheaper. I think it'd be a better deal for the for the taxpayer. you know, that was that was a frustration. You know, the other real frustration we had is on the real estate side. is that the government? the government does not. Congress. I will say not the government. Congress does not like to appropriate money for CapEx.

AJ Jackson 00:27:29  They like to build new buildings, but they don't like to do CapEx. And so you have a lot of buildings that are in really, really rough shape. And so one of the things that we had to do was figure out how, like with the courthouse in DC, how we could build an addition onto a courthouse that would create a ribbon cutting opportunity and also get the money then to do the CapEx on the rest of the building. I think Congress likes to build new buildings cause I like to cut ribbons. so I know.

John Coe 00:27:52  You've been out of GSA for a while, but looking at it today, what would you do if you were leading the agency today? And how would you manage their challenges of decreased use of facilities and reduction and requirements?

AJ Jackson 00:28:05  You know, I think from my perspective on the outside, I don't have all the I'm not in it. So it's hard hard to say. But my perspective on the outside, there's a real opportunity in this moment, given the dislocation in the commercial office space to materially both right size but also upgrade the quality of the government's real estate portfolio.

AJ Jackson 00:28:25  Yes, right. Just like every other private operator, you know, let's trade out of the seas, and trade into the A's and B's, and let's buy some of these assets that are selling at significant at significant discounts. Right. I think there's a real opportunity to do, to, to do some of that in the real estate portfolio. It's hard to it's, it's, it's hard to do. And it likely requires, some congressional assistance. But I think that's that's the real opportunity. I think that the government, that that the government has, in addition to collaborating with OPM, which essentially the personnel side of the government, to understand what space utilization really needs to look like for the federal workforce, how many federal jobs could be fully remote? which I actually think is an opportunity for the federal government. Right. Because it's often not the most competitive employer with regard to compensation. Right. But if you can be very competitive with regard to flexibility, I think that can be an advantage, particularly as the DC market has become more and more expensive and there's more and more private sector, high paid private sector jobs.

AJ Jackson 00:29:29  There's just more competition for kind of talent on the at the federal level. So, those are the areas, I think, where I would, you know, probably between.

John Coe 00:29:38  I don't know, maybe 10,000,000ft² right now downtown. Yeah. That could be repurposed. Yeah, that's owned by the federal government. Yeah, yeah. So if you if you were at the head of GSA, how would you try to implement that?

AJ Jackson 00:29:52  I think you've got to get Congress on board with you. Right. Starting with, Delegate Norton in, in the, in the district and then going, to the public building committees. But you've got to get Congress on board, with you in the disposition of of assets. I think ironically or not ironically, but but but I think there's a moment, because we've gotten into such a mess on the deficit side that I think there's going to be a real push for. Where do we raise money? it, you know, from from from any source. and so I think that may create that, that deficit pressure may create the opportunity to say, hey, look guys, there's billions and billions of dollars, tens of billions of dollars of assets here that we could dispose of that could be repurposed, that we don't need.

AJ Jackson 00:30:43  that would be a win, for the district in terms of vibrancy and revitalization and different types of activity in the core of the district, and be a win for the federal government as well.

John Coe 00:30:52  Even if it was a leasehold sale. They could hold the land.

AJ Jackson 00:30:55  Yeah. You know. Yeah, yeah, there's a lot of I think there's a lot of, a lot of opportunity. I do think it will require ultimate legislation. You know, Tom Davis, who was a great member from Northern Virginia, was was really instrumental with Lawton in trying to get, the federal government to be able to do, leasehold, sell and lease back interest there. So yeah, I think it requires legislation, but that's, that's kind of the direction I would push in.

John Coe 00:31:23  So then you went on to Harvard Business School and so talk about why and you know, why Harvard and you know why business school and what were your what were your goals for.

AJ Jackson 00:31:34  Why business school I went to business school basically to transition out of politics.

AJ Jackson 00:31:38  I'd been on Capitol Hill with Kasich, and at the end of five years, I basically looked around and said, I don't want to be a lobbyist. I don't want to be a congressional chief of staff, because that's primarily about fundraising until you get unless you're working for a really senior member. it's a lot about fundraising, which is just not that interesting to me. and I don't want to be a committee staffer. because I don't want to be that narrowly, you know, focused and be the expert on this one very, very narrow thing. And so what job exactly is there left for me to do here? and so I think I should try to go, you know, go to the private sector. That interest that I've had since since since undergrad. but having spent five years in the public sector, I felt that the MBA was kind of the fastest way to make a hard pivot, and really, signal, you know, to to future employers. my move to the, you know, to the, to the private sector.

AJ Jackson 00:32:38  And so that was the motivation for business school.

John Coe 00:32:41  what about the Kennedy School?

AJ Jackson 00:32:44  it's, you know, I I'm not a policy guy. I'm a I'm a I'm a doer. And I think that's why the GSA was also so appealing to me. you know, and I did think about the joint degree thing for, for a while, but, I just, you know, I don't know, I would be very frustrated if I spent all my time generating policy and not implementing. Sure. So that was that was probably the main.

John Coe 00:33:15  a way to bridge the public and private.

AJ Jackson 00:33:17  It is it.

John Coe 00:33:18  Is what you do now.

AJ Jackson 00:33:19  It is, you know, and it all comes full circle. You never get that far, that far away from. That's true. Right? Yeah. you know, it is. but I didn't feel that I had the, that I, that I had the essentially the right branding around things outside of the government. And so I thought NBA will that's a that's as clear as clear as you can send.

AJ Jackson 00:33:47  Sure. and you know, the case method was really the appealing thing to me at Harvard. because it was it was actual, you know, actual stuff. What did people done? What worked, what didn't work? so, yeah.

John Coe 00:34:02  What was the most exciting case that you saw that you remember? Do you remember any of them that was.

AJ Jackson 00:34:06  You.

John Coe 00:34:07  Know, one that was, anything related to the government at all or not? It was,

AJ Jackson 00:34:11  You know, we actually did have a couple of cases related to, to the Iraq war that were kind of fresh off the press while I was while I was there. It was pretty current. but the most interesting, actually. So I won't say the most interesting case, the most interesting course and, and probably the most valuable course that I took. There was a business history course, called Creating Modern Capitalism. The guy who's now retired named Richard Tetlow. But he's a great biographer of businessmen. But the the key, takeaway from that course is how history rhymes over and over again and how you look at things.

AJ Jackson 00:34:54  And really the question is when is something like this happened in the past that I can go back and learn about and reference, not what the hell's going on. Right. And so to reading, you know, I just remember reading all these cases, for example, about the, the, the expansion of the railroad industry right during the Gilded Age and thinking, wow, this is a dotcom bubble, right? Just, you know, in a different in a different form just over and over those kind of examples where you just see, you know, the themes. The themes are consistent, right? The circumstances vary, but the themes are volatility.

John Coe 00:35:27  Of the American economy.

AJ Jackson 00:35:28  And so it just yeah, even beyond beyond the US. You're reading about about about Wedgwood and his essentially influencer marketing strategies to sell, you know, to sell China. which is which is not that different than TikTok really. so it's, it's that was the most valuable, course that I, that I, that I took there.

John Coe 00:35:52  So you had a real estate experience at GSA. So you were at Harvard Business School. Did real estate really kind of stay in the front?

AJ Jackson 00:36:01  Yeah.

John Coe 00:36:01  So once, once.

AJ Jackson 00:36:02  I left GSA, I knew I wanted to be in real estate. And so I went to Harvard Business School, with the intention one of coming back to DC and two of working in real estate. Sure. That was the intention the day I entered. And, and this is where you can start to question my judgment because of all of this sort of, business schools. Harvard probably has the least well developed, real estate program. And so literally from the first day of school. I, I would do what they, what we called then a network job search, which is basically Harvard's way of saying you're on your own. you take the alumni directory, you find everyone who works in real estate, you divide it into blocks of ten, and you call, email ten people a day, every day. Wow. and so, that's what I did.

AJ Jackson 00:36:57  And not just in D.C. all over the country. and that's what I did. And at the at the beginning, I wasn't even I wasn't even marketing. I wasn't looking for a job. I was looking for knowledge. Right? I was looking for information because I didn't know. I knew what I knew from GSA, and I knew that that was a tiny little fragment of the industry. So I was I would talk to, you know, guys doing a retail investment, sales, somebody doing whatever, anything. You,

John Coe 00:37:23  In that conversations.

AJ Jackson 00:37:25  You know, there are a couple of guys out on the West Coast, who were really interested. I'll come back to the one who really struck me, but a couple in the West Coast were really interesting. One was the investment sales, retail broker who had been a homebuilder in North Carolina, then moved to California and started doing investment sales and talked a lot about kind of the stress and anxiety and why he left the entrepreneurial side of development. Right, and how it was deliberative.

AJ Jackson 00:37:51  But he couldn't sleep at night personally guaranteeing all these loans, etc.. but then you know what he hated about the brokerage industry and the fact that he started basically, as he said, I start from zero every January 1st, and I've got to go back and sort of and sort of, sort of rebuild it. That was that was just I learned a lot in that, in that conversation. But the guy who really struck me was Bob young. And so I met. This is how I met Bob. one of the things that that I did to sort of, improve my improve my job search was helped organize a trek to DC, with, the real estate club, and we did a series of panels, and one of the panelists was Bob, and we did a tour of some of the properties. And so that's how I got to know Bob. And we and we stayed in touch. you know, through, through through HBS. And ultimately I went to work at EIA after after graduation.

John Coe 00:38:41  So he's the one just meeting him and getting to know him. Yeah. It just felt good. And so did he kind of convince you that the, you know the for sale residential business was what you wanted to do.

AJ Jackson 00:38:53  No. You know I worked my, my business school between my first and second years I worked for Tishman Speyer, which I think was one of like three real estate companies that recruited. There's not not a lot. I work for Tishman Speyer, and, I realized that I liked the sort of B2C aspect of the residential, you know, kind of multifamily and residential space more than the office, than the office business just wasn't. The office business wasn't as exciting to me for, for whatever reason. and then when I met Bob, you know, they was just doing really creative stuff and kind of, kind of, at the time, pushing the edge. and also really, I thought impactful, impactful stuff. And it just kind of resonated with me in a way that while this is really, this is different.

AJ Jackson 00:39:45  so I want to learn more. I want to see what this is about. but you know, this. You know, you can kind of tell when something special. And that was that was special.

John Coe 00:39:52  It's quite a contrast in GSA. It's a very it's.

AJ Jackson 00:39:55  A very big contrast. So it's a very big contrast from GSA. yeah. It was it is but you know, that that again, it's, you know, I guess this is where Kasich and the guy who's the administrator, Steve Perry at GSA, this this legacy of having great bosses. I knew I wanted to learn from Bob and Terry. So that was, you know, like that was that kind of sold it. So talk.

John Coe 00:40:24  About your career.

AJ Jackson 00:40:25  There. so I started out, actually the same day as Acosta card. And if you, if you talk to a, I know you know, Acosta because everybody, everybody listened to this podcast knows the cash. But I started out the same day as a coach. We started basically doing the same thing, which was, junior folks doing development work.

AJ Jackson 00:40:42  Right. and as much so I was, I was learning, a lot about the industry, but really a lot about a philosophy and approach to business and how you deal with people. From Bob and Terry, that was just really special. so I grew as I was that at UIA. I grew to spend more and more of my time working on, mixed income housing projects, public private partnerships, and we'd call them when we worked with a housing authority or church or someone who is usually land rich, cash poor, and wanted something beyond just money from the development of their real estate. So money and affordable housing, money and jobs, money and whatever, whatever it may be, and really gravitated to that, to that work because I think I was, I was based on my political background and my government experience. I was just comfortable, you know, comfortable dealing with housing authorities and comfortable with all that kind of, sort of extra mental gymnastics that that kind of work, that kind of work requires.

AJ Jackson 00:41:53  And so spend a lot of time doing that work. and that was most of what I did at whose idea was.

John Coe 00:42:00  To do this.

AJ Jackson 00:42:01  Because,

John Coe 00:42:02  This goes a little bit away from what they typically.

AJ Jackson 00:42:04  You know, right before I came, EIA had taken on a project in Alexandria, Virginia called Chatham Square, which was the redevelopment of a public housing block. Anyway, I had done several projects in Alexandria and the city essentially wanted.

John Coe 00:42:20  That's where they cut their teeth.

AJ Jackson 00:42:21  A high quality developer they can trust. Yeah, to help with this redevelopment. And so they did. They did Chatham Square. and I think they realized what a good business it was from a, from a financial perspective, and also that there were many more opportunities to do similar stuff. Interesting. and so I think that was kind of that that had laid the groundwork, I think had gotten, you know, as Bob will say, you know, the first time, the Chatham Square opportunity came around, they passed on it because they didn't think they were mature enough as an organization.

AJ Jackson 00:42:55  This is all before before my time. but that that was really kind of the start of their foray into public private partnership. and then it just kind of grew. It grew from there, but it grew to really be a significant portion of, of, of the business, because it was a way to develop really great real estate that you couldn't otherwise find if you were committed to urban infill and you were committed to this sort of low to moderate density version of urban urban infill. The sites were, you know, becoming harder and harder to to find, but there was a lot of publicly controlled land that was exactly right for this type of thing. It also the building form, was one in which it was easier to integrate significant amounts of low income housing into that townhouse stack flat, building form than into a high rise, then into a high rise building. And so it actually worked well for the, for the housing authorities. It was also the for sale component allowed you to generate significant nearterm cash flow that you could use, in, through, through paying for the land that you could use to subsidize the development of the affordable housing.

AJ Jackson 00:44:08  And so it really turned out to be like the right form, and the and the right time and the right, like, you know, everything just kind of came together.

John Coe 00:44:16  That's a complex legal structure when you.

AJ Jackson 00:44:18  It was a very.

John Coe 00:44:19  Complex, publicly owned land. And you're doing for sale housing on it.

AJ Jackson 00:44:23  It was very it was very complex. We you know, it's an interesting structure. I'll tell you about, you know, we did the deal on capital one of the deals on Capitol Hill. We had 323 unit deal. So it's roughly a third of that or two thirds of that are for sale. Third market and third workforce. So let's just say we had 200 individual lot releases from ground lease that we had to get, now acting HUD Secretary Adrian Hoffman, then then housing director, to sign and put into escrow because we wanted, you know, we were going to sell these houses. We couldn't go back to the Housing Authority and wait for something to work its way through the bureaucracy to get signed when a home buyer wants to come to the settlement table, but they weren't going to release all the ground to us, because what if we didn't build? What if we didn't perform the reason they wanted the ground leases? Because it's easier to take back the land than to do some sort of foreclosure.

AJ Jackson 00:45:15  So the solution that we agreed to was they would execute all these releases and put them into put them in escrow. That's just one aspect of the complex structure.

John Coe 00:45:23  Then my legal bill on that one.

AJ Jackson 00:45:26  You have no idea. I have no idea. I can only imagine. I mean, there was that there's a, you know, homeowners association that actually involves rental housing that's occupied by low income residents but actually owned by the housing authority, tax credit financing, which needs to be pulled apart into separate lots. Payment in lieu of taxes. A workforce housing program that had, in one instance, second mortgages and the others. Covenants. That had to be anyway. It was it was it was a lot. It was a lot. but it was a great project. So.

John Coe 00:46:01  And it all sold out.

AJ Jackson 00:46:02  It all sold out. I mean, it was successful for eoa, successful for the housing authority, successful for the residents. So, you know, it's a win win win, as we like to say, but they do require a lot of lot of mental gymnastics.

John Coe 00:46:17  So EIA and I did I obviously interviewed Bob. So we talked a lot about the evolution of this company. And they went into the eventually got into the rental side. Yeah. Were you still there when that happened.

AJ Jackson 00:46:28  When we were just starting. So one of the the last public private deals I worked on was at Shady Grove, where they built, they've now built two apartment blocks, but that was a large sort of county, Montgomery County owned facility, where we did a master plan that included, a significant number of apartments and some retail hospital there. Now it's at it's near the near the Shady Grove Metro station. Just north of it. There was a piece of land used to be called the County Service Park because they had the liquor warehouse there, the central kitchen for the food services, the bus depot for ride on. All this kind of industrial use is sitting on top of a metro. And so we said, well, hey, wait a minute, what if we could move this stuff and you could, and we could build, you know, this new community here.

AJ Jackson 00:47:13  And so eventually we got the county on board with that. The state then threw a wrench in the plans because they decided they were going to build the ICC. And we had we had gotten control of two pieces of land north of the service park where we were going to move some of these industrial uses. The state decided they were going to put, not even a permanent facility, essentially a construction shed for the ICC on one of our properties. We had to get them to move that north to another property, which required amending an environmental impact statement. Oh my.

John Coe 00:47:45  Goodness.

AJ Jackson 00:47:45  It's the same story as all these. There's a lot of legal complexity, a lot of sort of breaking new ground. from a policy perspective. but we ultimately pulled that off. you know, I think we had a lot of we had a lot of those kind of innovative first, we worked on a deal. Well, actually, one of my first projects, I think the first entitlement I was actually ever really a part of in Montgomery County, at a site called National Park Seminary, which is in Silver Spring, which is an old near there.

AJ Jackson 00:48:15  So it was a finishing school. Then it was taken over by the army. It fell into disrepair. It's a giant historic site, that we actually purchased from the county through the GSA. because the county didn't want to, own it, but the GSA can only dispose of it to a government entity. So we did the simultaneous transfer thing. And then in the middle of development, we found contamination. We had to go back to the Army to get them to clean it up. we were able to use a brand new law that had never been used before to allow us to do the cleanup on the Army's behalf, because otherwise we would have been waiting around, you know, for a year or two of them to get around to cleaning this thing up. So a lot of projects like that where there was just, again, a lot of mental, mental flexibility required.

John Coe 00:48:56  That's cool, that's cool. So obviously EIA has a long time relationship with the GBG companies at the time. So I assume you had some interface with the JBG company when you were at EIA.

John Coe 00:49:09  Is that?

AJ Jackson 00:49:10  I did so after, you know, after 2009 or 10 or so, JBG became the primary equity partner for EIA for most of our, most of our work. So, you know, Matt and I are classmates who I've known Matt. but before and obviously a lot of other folks over here as well. but, yeah, we were working directly together. you know, starting whenever that was 9 or 10.

John Coe 00:49:38  And then you came over.

AJ Jackson 00:49:39  Yeah. And then I, and then I came over many years, many years later. but yeah, to launch, our social impact investing work and start the Washington Housing Initiative. I came over to, to do that, about six years ago now, I guess I was, yeah. 2008.

John Coe 00:49:56  So what? Why and so what, why didn't you stay in and continue there?

AJ Jackson 00:50:02  you know, it's a good question. I, I was not thinking about I mean, the Martian housing initiative, you know, wasn't a thing. I wasn't thinking really about, about leaving.

AJ Jackson 00:50:11  I said I had known Matt for a long time, and Matt approached me, and said, hey, I've got something I want to run by you. Can you, can you come? Come by my house and I'll. We'll talk about it. so I went over this is right before Thanksgiving. I remember very well I went over and he basically had this, this PowerPoint, you know, thing, ten slides or something. And we've got this idea we want to try to, we want to try to, to do something different around housing affordability. And so I flip through the slides and it's actually a pretty good idea. There's some creative things in here are different approach. You know, you guys are putting your own money behind it. You're bought into it. This is this is this is pretty cool. You know. Good luck. and he goes, well, I want you to run it. so so we don't we don't this is not something we do. and, and, you know, it's a complicated it's a complicated space.

AJ Jackson 00:51:03  And I've seen what you've been doing at UVA, and a lot of it deals with really complicated stuff, and a lot of it's around housing affordability. So would you do it? and, you know, this is this is, despite everything I learned at GSA earlier about dealing with judge and all, this is probably like, you know, the worst negotiation I've ever been through, because immediately I was going to do it. I mean, it was it was such a clear opportunity, I thought, to do something that could really be impactful and move the needle and had the buy in, you know, of this, of this organization. It was, you know, it's kind of like somebody shows you something you can't say no to. And it was kind of one of those moments. And so, so, that part that was the easy part, right? The hard part was leaving UIA because I really not you know, that was not where I was. and so, I ultimately went and, you know, told Bob, I said, look, I've got this opportunity, I want to do this.

AJ Jackson 00:52:01  and so we, you know, he was gave me a support and I left, and came over to came over to start it, but it was, you know, it was it was one of these kind of just amazing, you know, left field opportunities, that really couldn't, couldn't not do.

John Coe 00:52:19  As I recall, the first time I heard about it was when I had coffee with, with Rob Stewart. Yeah. And I think it was his. It was pretty much his ideas.

AJ Jackson 00:52:28  Yeah, I think so. Rob was really frustrated at the inefficiency in conventional affordable housing. and I think saw from a real estate perspective and from a finance perspective that there was opportunity to take a different approach that he thought would be faster and less less expensive. way to achieve, to achieve a lot of what folks were trying to achieve around housing affordability and could bring in private capital, which could could be scaled and be net additive from a resource from a from a resource perspective. so he had been noodling around with this idea, working with, with some folks here at JBG as well as at the Federal City Council.

AJ Jackson 00:53:15  and it started to kind of kind of get it, you know, get it going. And so that was the basis of what? Of what, you know, what Matt showed me, what the initial sort of, sort of plan was.

John Coe 00:53:26  Talk about the philosophy behind it a little more, particularly with what was happening about 20 years ago in Washington. And, you know, what we saw, of course, is the move east. Yeah.

AJ Jackson 00:53:39  You know, housing. Yeah. I mean, I think I think, you know, people may not know Washington, D.C. proper had the highest what they call intensity of gentrification, right? In the United States of any city in the United States, a significant influx of new residents into neighborhoods in that were historically black neighborhoods in Washington, D.C., and significant displacement of long term residents as a result of that, of that, of that, of that gentrification. That was kind of the context around a lot of what was going on in the district. and the notion behind the, behind the housing initiative was really how do we take institutional capital at scale and use it to preserve affordability and prevent displacement? And and also, as we say, unlock access to opportunity.

AJ Jackson 00:54:38  So create opportunities for people to live in resource rich communities, put the afford, put the affordability into these resource rich communities so that it can be of a benefit to the to the folks who are living in the properties. And so that was really the, the, the, the animating idea behind the Washington Housing Initiative, in addition to a focus on what we call the missing middle, which is basically the the person in DC. You think about him as kind of the 50 to $100,000 household income, right? Exactly. Policeman, fireman, teacher, restaurant manager. IT specialist, someone who's making too much money to get subsidized housing, but too little money to be financially stable in most of the rental communities in this region, and certainly in the ones that are, that are in resource rich neighborhoods. And so that was really kind of the, the, the, the animating idea. How do we preserve affordability, prevent displacement, you know, unlock that access to opportunity.

John Coe 00:55:42  So you you've started this impact pool.

John Coe 00:55:46  So how did you how did that money get organized and, and sourced.

AJ Jackson 00:55:51  So we you know, we said from the beginning we wanted private capital at scale. And we thought about who are the groups of people who are likely to invest in this. And we thought, okay, well, local high net worth investors who are motivated by community spirit and also by financial return, there are likely group of investors, foundations ought to be investors because it's mission aligned, but it also drives some returns. So they could make mission related investments. And then we said, oh, the there's this thing called the Community Reinvestment Act. And banks should be excited about doing this because we can structure this in a way that it will qualify as an investment in the Community Reinvestment Act. So we created the pool. We created a structure to appeal to those three groups of investors. And so we created certain tax benefits, certain CRA qualification for the banks, mission related investment structure for the for the foundations, and really went after all three of those groups of investors not knowing who where would have success or who would, you know, who would, who would, who would invest with us, What we learned pretty quickly was we were much more successful with banks, from a CRA perspective than we anticipated that we could be.

AJ Jackson 00:57:08  This was a new area in the CRA. This. They're used to buying low income housing tax credits or making direct loans. And so it did take some work to, to educate banks about about, what we were trying to do and assure them that it would be seri qualified. But we got a few of our largest banking relationships on board, and that really helped to bring in a lot more. we were much less successful than we thought. With foundations, they basically said, you're not a nonprofit, so I can't give you money. I understand it's a mission related investment, but all my real estate investments are in opportunity funds, and you're not promising me 20 IRR, so I can't make an investment from the corpus. I don't know what to do with you. and then on the high net worth side, we were very fortunate to have, some, some local, real estate and nonreal estate investors who came in early and that had strong, strong, strong signaling for us. But ultimately, we had so much success on the bank side that we decided not to.

AJ Jackson 00:58:07  We talked about like, trying to create a feeder or do something like that. We decided not to do that, because, because the, the bank side of the, of the, of the equation really worked out well for us. and so that's how the how the how the pool kind of, you know, that's how we organize the pool initially, but we had, you know, starting out, we didn't know. We didn't know where the capital is going to come from.

John Coe 00:58:27  Honestly, I sat down with you very early on, as I recall, and I was in the business at that time. So I was thinking, how can I make this money here doing, you know, placing debt in this space. And because you're and you can talk a little more about the deal structure, but as I recall it was mezzanine type or. Yeah, preferred equity depending on how you structure the deal. Yeah. That you would invest and you had certain restraints with regard to the, you know, income level of the tenants and all that.

John Coe 00:58:59  So maybe you can go. Yeah.

AJ Jackson 00:59:00  I mean, our our basic approach, our basic our basic idea is, is actually pretty simple. starts with invest where people want to live. So we spend a lot of time figuring out where we're, where we want to buy properties, right? Where do we want to be? And we call those high impact neighborhoods. We look at a lot of data around educational levels, around employment levels, around access to transportation, around a whole bunch. Whole streams of data, basically to try to pick the best locations. Invest where people want to live. Part two the strategy. Very simple strategy. Let's charge rents that they can afford. And for us, that means that in every property, we're going to restrict the majority of the units to people who earn 80% of Ami or less. And that is essentially somewhere between 65 and $95,000, depending on the size of your, your your, your household. so we're looking for properties where we're not going to have to write down rents significantly, but where what we're doing is competing essentially with value add investors to flatten the rent curve going forward.

AJ Jackson 01:00:05  Right, because it becomes very expensive to try to buy down a $3,000 apartment into an $1,800 apartment. But if you can take a 16 or $1800 apartment and basically say, I'm not going to do the value add strategy and try to press the rents 200 bucks, but I'm going to grow the curve essentially in line with, with CPI. that that's essentially what we were doing. and so identifying where we want to be, finding the properties in those neighborhoods that met those criteria. And the third piece, of the strategy, very simple, is operate these properties so that our residents never want to leave. And that means, you know, lower turnover, higher retention, more on time rent payment, all the operating performance. Because if you're not juicing the top line, we're really trying to control the variability of the revenue and then and then control and then control the control expenses. And then we found that there are little things that we can do to, enhance the returns sufficient enough to keep the investors, interested in what we're and what we're doing.

AJ Jackson 01:01:10  So, for example, when we make those affordability commitments, if we make them binding, we can structure our senior debt in ways that reduce, the rates. So we get a lower spread from the GSEs? we might get better scr. we might get a longer period of IO, which is important because since we're not getting subsidies, we use cash flow for CapEx. Right. And so little things like that at the jurisdictional level, we can get either property tax reductions or in some cases, abatements, depending on the level and length of affordability that we're willing to, willing to provide. And then we can also JV with other essentially impact or mission capital that has even lower cost, lower cost than ours. And so all of that is designed to really get us into, call it a kind of a core plus level of return for our, for our investors in these in these investments in the impact pool. We structured them as primarily mezzanine debt. And we did that so that we could have nonprofit partners who would be the owners of the real estate and maintain the affordability for the long term.

AJ Jackson 01:02:19  Right. Because the biggest challenge that we were the biggest sort of circle that we were trying to square was the impact. Pools are closed in vehicle, right? As a ten year has a ten year life. So how do you create long term affordability in a closed end vehicle where you also need to exit and return capital, plus hopefully return to your to your investors? What we concluded is that if we structured our investments as mezzanine debt that had a fixed maturity and a fixed payoff amount, we had no squabbles about the exit. We had no or we're going to bust covenants to get out to make them, you know, pay me what you owe me in your and you're done with it. And then our owner subordinate borrower was a mission owner. Then that was as close as we could get to ensuring long term affordability with short term capital. And that's that was sort of the basis of that of that structure. So it looks like mezzanine debt, but effectively from a sort of risk in position in the capital stack.

AJ Jackson 01:03:15  It's equity. Right. We're going up to call it 95% of the capital stack. Yeah. we're providing asset management, property management capital project management for all of the assets that were almost all that were missing. So our investments are generally 7 to 10 year investment.

John Coe 01:03:32  So at the end of 8 or 9 years who's taking you out there.

AJ Jackson 01:03:37  So the way that we underwrite our investments is by refinancing the first mortgage. So we're using essentially inflationary rent growth, you know, to two and a half to 3% sort of top line growth plus some amortization on the first mortgage to create the space to retire our loan at maturity. Right. But the key is that it's not you're our underwriting, our base underwriting going in assumes the maintenance of affordability into perpetuity and assumes rent growth in line with the long term historical average, which is again around two and a half to 3%. And so you're not really kind of banking on you don't have to knock the cover off the ball, right. You have to kind of not operate it, in a way where your expenses get away from you.

AJ Jackson 01:04:21  You have to be a little bit lucky and not have a crazy capital event occur.

John Coe 01:04:24  Also accounts receivable.

AJ Jackson 01:04:25  But but yeah. Yeah, that's part of that's part of the. Yeah. That's part of the expensive that's part of keeping keeping the residents happy, keeping the occupancies high, keeping the on time payment, keeping the on time payment.

John Coe 01:04:36  Pandemic had to hit you pretty hard though, didn't it?

AJ Jackson 01:04:39  It's, you know, the the interesting thing with the pandemic is I don't I went to the pandemic hit us hard. The policy response, hit us hard, meaning that in Washington, D.C. proper, we've had more issues coming out of the pandemic because of the policy response around eviction moratorium around really a broken process in the courts, frankly, with getting out tenants who don't, who don't pay rent with some of the other operating challenges in the, in, in the district. So overall, across the portfolio. No, I mean, not not really generally, our residents, you know, are were employed, continue to be employed and are paying they're paying their rent on time.

AJ Jackson 01:05:28  we've had a couple of challenges with assets in the district proper, but I really chalk those up to the district's Covid response more than Covid itself.

John Coe 01:05:39  So talk about what Leo does that that you didn't do before when you were in the impact pool.

AJ Jackson 01:05:44  So what we do, well, Leo is a platform for management. It manages the impact pool. we're in the process right now of of talking to investors about a new vehicle. And so Leo will manage that vehicle. it does the asset management function and portfolio management function, in addition to the addition to the to the investment. And it makes direct we make direct investments through, through Leo. So that a little bit of that in the impact pool. But the primary strategy is really this mezzanine strategy working with nonprofits.

John Coe 01:06:14  No equity investment.

AJ Jackson 01:06:15  We do direct equity investments. What we what we realized, one of the learnings from the from the housing initiative, as we've crossed over 3000 units, which was our initial our initial target, and we've got we've got more to go there.

AJ Jackson 01:06:29  But one of the learnings from the housing initiative around the mezzanine strategy was that the gate around the ability to deploy capital was really the equity that's required from the nonprofit owner borrower, right? senior mortgage lenders generally, no matter what we're willing to provide, want 5% true kind of g p sponsor equity from the nonprofit borrowers and all of that is donations right. That they've raised that is that is actually the most expensive, most difficult capital to get because you're asking someone to take a complete write off on it. Right. And so what we saw was need an opportunity that exceeded the ability to raise philanthropic capital. And so that was one reason, that we made the we're making the shift to doing more direct, more direct equity investment. We'll continue to do, the nonprofit, mezzanine structure. We think there's a there's a strong place for that and a need for that. but we can do even more if we're also doing if we're also doing equity, equity investments. The other thing that we saw is that in Washington, DC proper and in, parts of Maryland, there are significant advantages to being a nonprofit owner in terms of tax relief, in terms of access to right of first refusal processes that give you a little bit more flexibility in the purchase price, etc..

AJ Jackson 01:08:00  In a lot of other markets, including in Northern Virginia, those advantages don't really exist. And so the benefit of being using a nonprofit structure, even if it might be gating from a capital perspective, isn't really there in a lot of other jurisdictions because they don't have the same preferential treatment for, for, for nonprofits. And so we thought, okay, we can still be committed to affordability, we can still make these investments, and we won't be disadvantaging ourselves. And we can actually do more if we're making direct investment. So that's that's the other thing that Leo does that that's different.

John Coe 01:08:32  So what's your next goal? As far as units.

AJ Jackson 01:08:36  we, you know, we don't have a unit. We don't have a unit goal, per se. Our next our our our next goal. What we're working on right now is raising capital to be able to do more direct investment, in, in workforce housing. And I think we're we are we see multiple sort of multiple strategies in the workforce, housing space, if you will, or around around housing affordability in these high opportunity neighborhoods that we can that we can pursue.

AJ Jackson 01:09:12  and so we're trying to raise capital around those, around this, those strategies. Right, right now. Good.

John Coe 01:09:21  Amazon's HQ2 was and is a huge shot in the arm for this region. As you know, I interviewed your boss, Matt Kelly, and he described some of that impact. Curious if the collaboration collaborative effort with Amazon was instrumental in the formation of your impact pool and consequently, Leo Capital? I mean, they obviously helped.

AJ Jackson 01:09:44  Well, actually, the impact pool predates the Amazon, the Amazon selection. So, the the the Amazon, the impact pool was actually, a significant part of the formation of the Amazon Housing Equity Fund. Right. that model is, is very similar to the impact pool model in terms of providing subordinated debt to allow sponsors to acquire existing assets and place long term affordability restrictions, Restrictions on them. I think one of the things that was, significant in the Amazon selection was the fact that JBG had already started the housing initiative, that it was not something we dreamt up as a part of the pitch to Amazon, but something we were doing previously that we could then talk to them about in the pitch and say, hey, we've we're thinking about housing affordability in this market, and here's what we're doing around it.

AJ Jackson 01:10:42  Here's what we think a reasonable strategy is, because housing affordability was a big issue for them in their search, because of the experience they'd had in Seattle. And I think it lent a lot of credibility to be able to say, oh, we didn't hear that and think about this. We were doing this. And you would you like to be a part of it? And here's how we would here's how we think we could come at it. So that, that I think that was really, that was really significant. Having said all that, you know, in the impact pool, we've done three deals that also include Amazon, including their very first deal at Crystal House. And so, you know, they basically supersized, you know, what we were what we were doing. We had $150 $140 million fund. They said, how about we do a $2 billion commitment? with with capital that's, you know, half the cost of yours because we can borrow cheaper than the federal government. and so they really they really supersized the effort.

AJ Jackson 01:11:38  And I think drew have drawn tremendous focus, to preservation of existing assets as an important component of an affordable housing strategy. in a way that I think we we couldn't have done on our own. And I think it's been really important because they're so big that they've gotten the, you know, the public sector in this market, but also in Nashville, obviously in Seattle. And I think even in other places in the country to realize, oh, preservation is part of our housing affordability strategy. It's not, you know, something off to the side or it's not unimportant. I think it's been really, really, you know, kind of transformational for the space.

John Coe 01:12:17  Another piece you haven't talked about yet, which I'd be interested in your flavor on. Is the environmental impact of not doing ground up as opposed to.

AJ Jackson 01:12:26  Yes. Yeah. Yeah, it is preserving. It is. yes, yes. The greenest building is the one that's already built as. As they say. Yeah. No, it it's it's an environmental.

AJ Jackson 01:12:36  It's an environmental savings. It's a time savings. It's a cost savings. It's access generally to better locations because a lot of the best neighborhoods are, are, are highly built out. and it's less expensive on a, on a, on a per door basis than, you know, the new construction. There's a lot, I think that commends preservation. We need new construction because we we're net short of units and so we need more units. But we also need to maintain the affordability that we have, particularly when it's when it's well located, because that, that is greener, faster, cheaper. It also drives, long term, you know, great outcomes for people to be able to live in those in those neighborhoods. And so that's pretty clear.

John Coe 01:13:21  Well, I learned about the Amazon Housing Equity Fund when I interviewed Katherine Buell, who started it and actually wrote a six page memo to Jeff Bezos, which she wouldn't share with me, unfortunately, which I asked her for, but she wouldn't share it with me.

John Coe 01:13:37  I said, I wonder if you called up R.J. to help you with that memo, because as you just said, the fund was already in place. The ideas were very similar. So. And of course, she worked here. Yeah. She was at Saint Elizabeth's, you know, and she's a native Washingtonian. You know, she grew up in Montgomery County, but she lives in Anacostia, so.

AJ Jackson 01:14:01  Yeah. Yeah. And, you know, when she'd run the Housing Authority in Atlanta, she came at it with a lot of. Yeah, a lot of the right experience. And had been at and had been at, at, the Greater Washington Partnership, you know, really leading them on housing, but also seeing that regional perspective, and seeing what corporations could, you know, you know, could do, to try to, to try to try to move the, try to move the needle. so, yeah.

John Coe 01:14:28  So I, you know, I asked her so and she, she was so at that point when I met her, she'd already invested, she'd already committed 2 billion.

John Coe 01:14:37  So she'd already had it out there. And I said, this is amazing. And I did ask her the question, what about other corporate entities? You know, your competition, maybe the Microsofts of the world, the apples, the Googles, you know, why aren't they doing the same thing? Because they're making a footprint. Certainly, you know, all of them have huge real estate impact in their markets. They're in. Yeah, but I understand Amazon because you have AWS, which is now the largest, I think the largest cloud, you know, provider in the world, if I'm not mistaken. So they're in that. And then all the warehouses and all the distribution that the company has is. Yeah. It's phenomenal.

AJ Jackson 01:15:20  It is. You know, it is interesting the the different responses. I mean, some of the tech companies, particularly back in the Bay area, have, you know, have have tried to get involved in, in housing supply or housing affordability. Google's doing it through land, that they, that they have acquired where they're actually trying to, to essentially be a master developer.

AJ Jackson 01:15:46  you know, Facebook and others have made contributions to other to other funds, to try to sort of try to spur. But I don't know that anyone has had, the level of impact in terms of I think Amazon has funded more than 20,000 units at this point. the level of impact that Amazon has, has had. and I think the risk that they were willing to take of putting themselves out there, right, and saying we're this is what we're going to try to do, and we're going to make these direct investments, and we're going to run it ourselves, is a risk that most of the other players have not been willing to take, and that most businesses writ large, have not have not been one to take. I mean, one of the the great, you know, failures that we've had with the Washington Housing Initiative is the inability to get other corporate leaders, particularly outside of the real estate industry, to engage on housing in the same way that they engage on education or transportation or public safety or workforce.

AJ Jackson 01:16:52  And US housing affordability is just as critical as all those other, what I'd call infrastructure issues to having a functioning, dynamic local economy, to having the type of employees that that you want to have to having the robust environment that they want to live in, etc.. But business has generally been very skittish about engaging on housing, I think, in part because they can't get their head around the problem and they don't want to take ownership of more than they can reasonably address. They don't want to be accused of not, you know, of of not solving it. So I think Amazon should really showed a lot of credit to get out there and, and encouraged to get out there publicly and say, this is what we're going to do, and then do it and then do it themselves. And, you know, my hope is that it would be an inspiration to other businesses to do it hasn't worked out, as you know. there haven't been as many coattails as, as, you know, I think as even they would have wanted or certainly as we would have wanted, you know, simple.

AJ Jackson 01:17:52  Who runs the housing equity Fund now? You know, was is very fond of saying, like, we can't solve this on the ground, like we're not going to we're trying to basically shine a light and make a path, but we're not going to solve it. And I think we feel the same way, you know, with with what we're doing at Leo, that the best thing that would happen is if somebody else would compete with us. Right? Or 3 or 4 people would compete with us because more capital committed to sort of balancing the housing market is, I think, a net positive, for the, for the, for the region.

John Coe 01:18:22  The question I have, because you're a for profit, the other one, the other question on it. So you're additive to the bottom line of JBG Smith. I will hopefully. And but, you know, there was a purpose behind that. And how do you see Leo fit into the overall corporate mission of JBG Smith?

AJ Jackson 01:18:44  Yeah. It's funny. I mean, we're we're, So our Leo is owned by our taxable REIT subsidiary, which is all of our non sort of core real estate, businesses because it's it's doing a lot of management management work.

AJ Jackson 01:18:58  I mean, you know, we are, we are rounding on the bottom, on the bottom line to be to be to be fair about it. but what we do is a couple of things. you know, this, this workforce housing business is, is, you could call it countercyclical. It's really a cyclical because of the fundamental supply, demand imbalances. So it is a way to utilize the platform essentially across across cycles. Right. So there is there is that it is an opportunity for people in the organization to use their core skills and talents in a way that is community benefiting. Right? So we're we're very philanthropic. We're very big on, you know, days of service. We have something called JBG Smith Cares. We do a lot in the in the community. But I have to say that the response that you see, the reaction that you see from people who are, you know, in accounting or in marketing or whatever it may be, who can do what they do every day, but spend a little bit of time doing something that benefits the community using their core skills.

AJ Jackson 01:20:08  It really the level of buying, engagement, excitement that people, you know, get from that. And I think even folks who don't work on it directly. there is and I think, you know, not to tutor on horns, but justifiably, you know, a little sense of pride about being a part of an organization that's doing these things in the community in which it has such a large footprint. So I think that sort of, internal return, if you will, is not insignificant. there's also the simple fact that we are a publicly traded company. You know, we do have, both ESG and CSR. measures, and what we do in the housing initiative and what we do in Leo is a part of, as a part of our, our social impact. Right? We are a social impact investment platform. It's a part. It's a part of what we what we do, what we do there. and then I think, you know, it would be, you know, in all fairness, we have to say to it, it is only helpful if we are building relationships with communities around addressing housing affordability, which is the number one or number two issue from every local politician I've talked to in every market that I've talked to a local politician in, in this, in this, in this country.

AJ Jackson 01:21:27  If we're, if our, if our if we're having those types of interactions, it's only, beneficial to all the other interactions we want to have and all the other parts of the business with those same elected officials. Right. And it lets them see sort of the full spectrum of the organization. and the fact that, yes, we are a business, yes, we are trying to make return for our for our shareholders and trying to trying to make profit. But we are also trying to invest in a real significant way, with the meet the muscle of the organization back into the communities. That's, that's a helpful, you know, position to have.

John Coe 01:22:07  So my next question is about the Urban Land Institute. But before I get into that question, I want to talk about our asking if you are involved in a product council that relates to affordable housing and if you are. Have you advocated on a national basis what you're doing here and also brought Amazon and say, okay, guys, and let's go to Los Angeles, San Francisco, Miami, Florida, all these other markets where there's obviously affordable housing issues, right?

AJ Jackson 01:22:38  Yeah, I am involved.

AJ Jackson 01:22:39  I was I was I've been on a product council for a long time. I was, I was, chair of the Public private Partnership council for a number of years. I'm now on the affordable workforce housing, council. And yeah, we have advocated around preservation around I mean, it's it's been it's been interesting to see and I think Amazon, gets a lot of credit, and I think we get some credit for what we've been able to do in the Washington market. It's been interesting to see the evolution of the conventional affordable housing community, thinking around preservation and around, this workforce housing or missing middle space. I think there was a lot of skepticism about it, in the, in the beginning about whether it was really additive about whether it was impactful. and now, you know, we've done, deals with with, Montgomery Housing Partnership MP. We've done deals with Apple. We've done deals with with Nht, with other other nonprofit, affordable housing providers in, in this area. And Amazon has done the same.

AJ Jackson 01:23:42  I think that our actions and their actions and others in other parts of the country have are starting to move the conversation so that folks really see that there's a spectrum of housing need from the deepest level of affordability and permanent supportive housing all the way up to market. And we actually need interventions and activity all up and down that spectrum, and that you can that this is additive activity and not competitive activity to, you know, low income housing tax credit development or to permanent supportive housing or those kind of things. so we have been advocating. and I think that the views are starting to views are starting to, to, to, you know, to change. but I also I'm really encouraged we talk every I'd say at this point it's fair to say every week we talk to someone in a city or county, someplace in the country who wants to do something like what we're doing, or at least learn what we did and figure out if they can tweak it for their market. And sometimes it's a fit and sometimes it's not a fit.

AJ Jackson 01:24:44  But it's encouraging to see that. And it's and it's it's all I mean, you know, it's the Midwest. It's the Sunbelt where you would expect it to be, but it's also small towns. It's big cities on the coast. It's literally everywhere. like I said, it's the number one and number two issue, pretty much every, every market.

John Coe 01:24:59  What's interesting is the pandemic is actually accelerated.

AJ Jackson 01:25:02  That it.

John Coe 01:25:02  Has dramatically. It has I mean, the housing increase in values. It has. I just saw a statistic. It's just like 20% increase since, you know.

AJ Jackson 01:25:11  It is really 20. It's, you know, nationally, it's it's the Harvard just put out there. two reports actually state of the rental housing market and the state of the housing market, but at any rate, and one of them, they they were showing that since 2001, but actually not even between 2001 and 2022. housing rents grew ten times as fast as wages. Median rent to median wage. Wow. Right.

AJ Jackson 01:25:39  Ten x expansion. Right. And so there's just no it's acute everywhere right. It's acute. And even if rent growth has slowed or soften in some of those markets, The fact is, it's nowhere near in line. You know, you've still got the same affordability gap. Maybe the gap is not widening quite as much, but the gap is. But the gap is, the gap is huge. And I think, frankly, the any of the sort of rent relief that you see in some of those markets is going to be short lived because supply is turned off. and so as you work through the immediate delivery, as you're back into the same sort of supply demand imbalance. so yeah, it is it's, it is an important, it's an important issue.

John Coe 01:26:23  It's one of the conflicting influencing issues that just creates, you know, the increasing social tension out there.

AJ Jackson 01:26:32  Well, yeah, I mean, I think in particular where we focus in the workforce base, there's deep need at lower incomes, but there's also need in the in the middle.

AJ Jackson 01:26:40  And I think, yeah, it it resonates because it is the most, evident manifestation of the decline in sort of opportunity, upward mobility in the country. Right. You know, there's there's this, this statistic that I wouldn't say I'm fond of it, but that stays. It stays in my mind that, You know, the chance of outrunning your parents is basically gone from, you know, 70% plus in 1940 to a 50/50 shot, at, you know, at best. And it's actually declined the most for middle income people. Right? High income people probably wasn't that great. But there's a lot of wealth there. And low income people, the math almost pulls you just from an inflation perspective above your parents, even in real, in real terms. But in the middle, there's really this lack of mobility. And the housing affordability is a very, visible manifestation of, of that. And that, I think, is really the underlying angst, you know, that people have, which is why we are so focused on creating affordability in these neighborhoods that have been proven to unlock opportunity for people.

AJ Jackson 01:27:52  Because if you can create this foundation of of essentially affordability and stability, and then there are things that we do on the operating side that try to build community. But if you can create that in places that are opportunity rich, then that is what unlocks, you know, gets that, that sort of flywheel of upward mobility restarted.

John Coe 01:28:12  So now I will go to my question about what I was going to ask you in 2022. You participated in a July workshop that produced, quote, the ten principles for Embedding Racial Equity in Real Estate Development, which I will share in the show notes of the episode, perhaps at a high level. Share these principles and cite examples of where they come into play in real estate development, investment, finance and other disciplines in our industry.

AJ Jackson 01:28:40  Yeah. I mean, at a high level, I won't go through all ten principles, but because you're going to link them. But at a high level, it's really about a few things. One is having an equity lens to everything that you're doing.

AJ Jackson 01:28:52  So in every decision that you're making and every investment that you're making and every choice of team member that you're making, you're taking you're taking this equity lens. And the equity lens is really simply who's impacted by this decision that's not in the room or at the table. And am I okay with that? Am I not okay with that? What I need to do to to get that perspective in if I'm if I'm not okay with that, because as we talk about in the report, you know, the equity really to us means, just and fair inclusion or everybody having having a sort of a shot. so that's, that's one that's sort of one piece having the equity lens, to what's the business case? You've got to make the business case for racial equity. And this is probably the most controversial of the principles. There's a lot of debate in the work group around this, which was a group of people from who are practitioners from all aspects. This was not sort of an academic thing or a think tank piece.

AJ Jackson 01:29:47  It was really people who are doing the work every day in different types of institutions and communities all across the country. and ultimately, the business case discussion was so tense because for some people it is a moral issue, right? Racial equity is a moral issue. And the idea of putting it in terms of dollars and cents is offensive to them. But for others, their point was if you're going to move the needle, you've got to move the needle among the the nonbelievers, the people who are not already in the boat. And and this is business. And so in business you've got to have a business case. And so what is the business case around racial equity. We think it's, it's it's pretty clear in terms of better decisions in terms of identifying different markets, in terms of access to capital that you might not otherwise have. It all depends on the situation, but the business case is actually not as difficult to articulate in most situations as you might think. But it's important to make that business case to get everybody on board.

AJ Jackson 01:30:56  with, with with with moving forward. and then the last two pieces I think that are really important are you've got to build your knowledge, and then you've got to use your power. And everyone has power, whether it's positional power, individual power, organizational power. But you've got to build your knowledge and use your power, in the application of that equity, of that equity lens. And so that's really the core of what it's about. The ten principles are designed to be it's not you know, it's it's not a roadmap or it's not a prescription. It's a toolkit. And it's designed so that people from all different aspects, if you're a developer or a community planner or an architect, a banker, whatever that you can take out of it, and whatever stage of projects you touch, wherever you are in the sort of in the cycle you can take, you can take that toolkit and pull out things that work for you to try to improve, improve, racial equity, include racial equity in your in your real estate development practice.

AJ Jackson 01:31:54  again, because we do believe there's a real business case behind it in terms of, return, in terms of access to capital, in terms of access to different, to different to different markets. and in some instances in, in terms of securing entitlement, where it's becoming increasingly, an issue at the local level, in the entitlement process. So.

John Coe 01:32:17  We talked about gentrification already a little bit. so is there an equitable way to improve the housing stock in urban areas without social impacts of gentrification? What examples can you cite?

AJ Jackson 01:32:33  Yeah, you know, I think gentrification gets conflated with displacement. Yes. and I think, you know what we talked about originally, you know, this whole idea of preventing displacement, we want to prevent displacement. But we were we've been pro gentrification. Gentrification means bringing new resources into communities, right? So if you're if you're making physical improvements, if you're bringing in, new residents who have more social capital, economic capital and political capital. If there's not displacement, that can be net beneficial.

AJ Jackson 01:33:11  but when it comes to displacement, I also think it's important to think about that from two perspectives. There's the physical displacement of someone new has come in and bought my property and pushed me out, or someone new has come in and said property values have gone up, and now I can no longer afford to live here because the rent has risen. Property taxes, physical displacement. There's also the cultural displacement, right? Someone new has come in on a vacant lot where there was no housing and built housing. And in the bottom of it, they put all these stores that don't seem like they're for me, where I don't feel welcome or they're not the kind of place where I want to shop, where they don't have the products that I want to have, or they've raised the commercial rents to the point that the businesses that have been here, that I've been frequenting are gone. And so in my neighborhood, even though I'm still there and I'm in my rent controlled apartment, my neighborhood doesn't feel like my home anymore.

AJ Jackson 01:34:01  Right? And so those are really kind of the two aspects of gentrification. I think the cultural piece and we talk about this in the Ten Principles of Racial Equity, the cultural piece is really, really important to focus on in the context of new development because, one, most of the physical displacement has already occurred in DC, for better or for worse. And a lot of the neighborhoods certainly in north in northeast DC. So it's really what are the cultural elements that are important to people? What is the history and context into which I'm stepping, and how do I preserve that as I'm additive with what I'm doing and not replacing with, with, you know, with, with with what I'm doing? I do think that there are opportunities. I look at some of the projects that have been done, you know, with, with the D.C. Housing Authority, where there's been one for one replacement of public housing, but the addition of market rate and workforce housing and community amenities into those projects in ways, and then very intentional programming and activity by the housing authority and their managers to make residents feel welcome and try to build community.

AJ Jackson 01:35:18  We did some of this in EIA at Capital Quarter. we did some of this in Alexandria with the Alexandria Redevelopment and Housing Authority. or I think one of the key sort of innovations that we hit on there, it's not really an innovation. It was just the idea of phasing development so that we could move existing residents around among the blocks, as opposed to scraping five city blocks at once and trying to build back, which is probably a little bit cheaper in the historic way of doing things, moving folks around and doing the development in phases leads to much higher retention of the incumbent lower income residents, then pushing people off and then trying to get everyone to come back. When you think about it in your own life, if you move somewhere for 4 or 5 years, you've established a new community. Do you really want to come back? Is it, you know, is that and so the idea of of again, doing that, doing that phase of development, but then operating the properties in ways where we were deliberately trying to build community across the lines of difference of the residents at different, at different income levels, that level of intentionality, so that people don't feel culture displaced, even if they're not, if they're not, if they're not, you know, physically, physically displaced, I think things I don't know, there's there's a lot that that can be that has been done, that can be done that I think, you know, gets at, the displacement component of gentrification.

John Coe 01:36:42  Well, historically, the government in Washington, in the city itself, has done several things that I'm not sure exactly long term. Great. Let's I'll talk about a couple of one is Topa, which is, yeah. a law that requires you to wait one year to close on a purchase of a property. So that's one law, and the other one is the rent control law. The way it's written now. And so it just seems to me that, you know, they want to preserve affordable housing, but they're shooting. They're shooting themselves in the foot to some extent.

AJ Jackson 01:37:20  I completely I, you know, I, I give the mayor, Mayor Bowser a lot of credit. She identified housing as a priority. She took an equity lens of that approach and said, we want to have it, in all seven Ward. We want to have it in neighborhoods of opportunity. We want to increase affordability. We want to target low income families and moderate income families. She did a lot. I think that was that is really good.

AJ Jackson 01:37:47  I think, though, to your point, if housing affordability is a critical issue, then you've got to look at every policy that you have and say, is this helping or hurt? Yes. And stop the ones that are hurting. And in both of those cases, I would agree with you. I think they're hurting. Rent control is not an affordable housing policy because it's not means tested. Affordability is a function of price and income. Yeah, not just price. Right. And so the I think there are ways to better provide affordability and high opportunity neighborhoods and not just rent control in high opportunity neighborhoods, which I really think can be a giveaway to to people that that could, could frankly pay more. similarly with Copa, which was a policy originally created to protect low income households from, condominium and coop conversion of of their buildings has now become something of a cottage industry, where there's community organized to try to extract value through the threat of delaying project or delaying sales of of assets. And what that's having is a chilling effect on the market in DC, where there's less capital there.

AJ Jackson 01:39:01  It's very unpredictable, particularly in this rate environment. How can you be under contract for a year and not know if you're going to close, and what price and what price you're going to you're going to close? If you I understand the intent of trying to preserve affordability on asset sales. And I think that if we look at what Maryland does with its right of first refusal laws, there is a process that is much more efficient, much more predictable, and also linked to affordability, because Topeka really has no link to any public policy objective, as it's currently being implemented. Right. And so where is where is the public benefit in a purchaser giving $1 million to a group of tenants for them to divide up among themselves in a high income building. Right. As a as a purchaser of buildings, I would much rather put that money to the Housing Production Trust Fund or even put it into the general fund of the district government. I just I just don't see a lot of, you know, policy.

John Coe 01:40:07  How hard would it be to change those laws in the district?

AJ Jackson 01:40:12  I think it'd be very hard.

John Coe 01:40:13  I think it'd be very hard. And so what's the political pushback, these these groups that are. You know, I.

AJ Jackson 01:40:18  Think it's about perspective. Honestly, I'm not going to impugn anybody because I think it's about perspective. I think there are a lot of folks that are very committed to Toba and the Topa that they know is one in which they work with low income residents who have bad landlords in bad buildings. And when those landlords try to sell those buildings, they can drive physical improvements, deferred capital investments, they can draw preservation of affordability, they can prevent their displacement, or they're in high opportunity neighborhoods. And when people buy, people want to buy them out and renovate the buildings and raise the bar and raise their rent, or they want to renovate the buildings and condo, convert them, that's not in this rate environment so much anymore. And in those cases, the buyout amounts can be truly life changing for the low income families who live in those units. And so that's the universe of Topa that they see.

AJ Jackson 01:41:13  That to me is a is is a small subset of the of what's going on in the market. But that's what they see. And so I think people that are ardent defenders of the, of the process who are well intentioned and I think trying to Trying to be advocates for, for for low income households, renters in the district. That's their role view. What they're not seeing is a group of tenants organizing in a building with $5 rents to, you know, shake down, an owner because they know they can, you know, they can delay a process for a year if they want to. and so they're asking for a seven figure cash payout in order to not delay a sale of a, you know, of a high end apartment building which the tenants could never buy, which has no inherent affordability, as it were. So I think, you know, to my mind, there's a way to focus in on the buildings that are either of a scale for tenants to actually buy them or contain, or could contain a meaningful amount of affordability.

AJ Jackson 01:42:14  And everything else is either a payment in lieu or a tax, or basically.

John Coe 01:42:18  A line item. Restructuring of that of that act?

AJ Jackson 01:42:22  I think so, I mean, again, similar to the right of first refusal process in Maryland, but yeah, a line item restructuring where if about pick your number, if a building is more than 250 units or something, the tenants aren't really going to buy it, right? So let's pay a fee. And if a building is selling for more than $100 million, let's pay a fee. And then in smaller buildings. Okay, let's help tenants by 20 unit buildings. If they want to buy 20 unit buildings. And let's have a mechanism to preserve affordability in buildings where the average rent is 1400 bucks. But in buildings where the average rent is 3000, I'm not sure that preserving affordability is really,

John Coe 01:42:58  The biggest challenge is how do you why do you what incentive is it to maintain your building? You know, so buildings get deteriorated very well.

AJ Jackson 01:43:08  I mean, yeah, I think the, I think the, the, the rent control piece, you know, and there's the DC Policy Center and others have tried to try to, do some do some work around this, but the rent control piece is really challenging.

AJ Jackson 01:43:23  Where, yes, it is a it is it's frustrating because I would argue that it's been objectively proven in jurisdiction after jurisdiction, that it does not work. but politically, you were doing something. And I understand that if you can vote for doing something people are concerned about, you know, the rent is too damn high. Okay, I voted for rent control, but you're doing something.

John Coe 01:43:48  That's my point. That's why I wouldn't bring it up with anybody else. Ours is either the one. The problem is, ours.

AJ Jackson 01:43:54  Is harder to explain than I just. I've been a freeze the rent.

John Coe 01:43:57  You know, that's the that's.

AJ Jackson 01:43:58  The problem, but I.

John Coe 01:43:59  I wouldn't bring it up to anybody else. I mean, I completely.

AJ Jackson 01:44:02  Agree, I find it I, I find it very frustrating. and probably more so than rent control because, because there's just I don't see any public benefit in a lot of these class A transactions that's being achieved by these delays and these payments.

John Coe 01:44:21  And what it does is it really puts an artificial constraint on the capital markets in the in the property, property valuation, creation.

John Coe 01:44:29  I mean, you can it's cascading it it's a cascading issue.

AJ Jackson 01:44:33  It is a.

John Coe 01:44:34  Cascading. And it creates this negative impression of the District of Columbia that really shouldn't be there.

AJ Jackson 01:44:39  Yeah, it definitely it definitely dampens investor appetite. You can see that there are fewer, you know, fewer bids for for D.C. assets.

John Coe 01:44:47  So it's frustrating. so, addressing social impact. Talk further about your mission there. And other than capital, how are you sharing the message of diversity and inclusion?

AJ Jackson 01:44:59  So, you know, we we talk a lot about this, you know, with with the Leo team with, with investors, with the public sector, with everybody. This notion of unlocking access to opportunity. Right. That's really what it means for us on the impact side is, again, let's find these high impact neighborhoods. Let's preserve the affordability there. And then let's operate these properties to build social connection, to empower economic mobility. Because that's that's really what what we see. We think that there is a tremendous opportunity for more from our real estate investment standpoint, but we also think there's a tremendous opportunity to improve upward mobility by doing this in these high impact neighborhoods.

AJ Jackson 01:45:47  And so that that's really the sort of essence of of what we're what we.

John Coe 01:45:50  Define, what a high impact.

AJ Jackson 01:45:52  Neighborhood. So to us, a high impact neighborhood is a neighborhood that has high educational attainment, low poverty, good transportation and retail access. The other amenities of, of life and, and relatively high incomes. I mean, that's that's what it is, right? It's the kind of place where you'd want to live. and unfortunately, historically, with a lot of affordable housing because of the cost pressure, it's not been located in high impact neighborhoods, it's been located in low opportunity neighborhoods. And the the social science is very clear around this, right? That if that high impact neighborhoods promote upward mobility, that growing up living in those locations produce both physical and mental health benefits, but also long term, earnings, socioeconomic benefits for the people that for the people that live there. And so that's why we're so laser focused on that's where we're going to invest. And that's the only those are the only places we're going to we're going to invest because that's that's that that is the impact portion of what we're trying to do.

John Coe 01:46:57  So you know, you've been in certainly inside the Beltway in Northern Virginia, you're in the district in some areas and You're not in Anacostia. I'm guessing we're not. Okay. You're in Prince George's County at a few places in.

AJ Jackson 01:47:12  County and Montgomery County. Yeah. Okay.

John Coe 01:47:14  Yeah. So, for instance, let's take Prince George's County. Where would a high impact area be?

AJ Jackson 01:47:20  you know, we look at this and we look we will get as granular as the block level, when we're when we're when we're looking, but we generally look at the census track and zipcode levels when we're doing our initial screening. But for example, we have a project in Hyattsville in Prince George's County in Prince George's County, Maryland. Right. that's that's a high impact, you know, location on EastWest highway. it's not it's not it's off of it's not on EastWest, but it's off of east west. Yeah, but not far from the not far from the, from from the metro there. But again, transportation access, educational attainment, incomes, access to opportunity.

AJ Jackson 01:47:57  Right. Again, it's it's does the neighborhood provide access to opportunities? College Park would be would would be one. You know, Dean would in northeast D.C., it's not Anacostia River. I think it would. I mean, again, we I'd have to call up the, the map, but yeah, I think there I think New Carrollton would be we haven't we don't have anything there. We only have, well, we have an investment to come apart, and we have an investment in, in Hyattsville. We've looked at a couple of others along the route one corridor in Prince George's County, again, Silver Spring, and and and Bethesda, in what about Montgomery County? yeah. Yeah, we've certainly looked in Germantown and Gaithersburg. I mean, it really it it really is, that's a unit of analysis. That's that's bigger than what we would look at. I mean, we really the furthest out we're going to go is the zip code, and then we're going to go in from we're going to go in from there because it really is.

AJ Jackson 01:48:56  What's that environment? If you think about you know, it's kind of a flip on that take of, you know, the 15 minute City. But what is that immediate environment that you're in that's affecting your day to day life? And how much opportunity is in that is in that environment? That's really what we're.

John Coe 01:49:13  Also trying to say Columbia.

AJ Jackson 01:49:14  Pike Corps and.

John Coe 01:49:15  Montgomery County.

AJ Jackson 01:49:16  But oh yeah, yeah, yeah. An area. Yeah. That is yeah. I mean, we have an investment in Wheaton, you know, for, for example, in in Montgomery County, it doesn't necessarily mean, you know, the highest income, most exclusive. Oftentimes those those lack other, other resources that are important, particularly for low and moderate income households, because a lot of those the wealthiest areas are kind of transportation, transportation deserts, and maybe employment deserts. And so that access is also becomes an important factor. So it doesn't have to be the most, you know, the highest income, the most inclusive neighborhood, but it has to be a neighborhood that's not, in decline.

AJ Jackson 01:49:58  A neighborhood that has residents, other residents who have the social capital that can help to lift all boats. That's really the key.

John Coe 01:50:10  We talked a little bit about this, but you know why? Why do you think that other large real estate organizations haven't followed suit and taken the steps that JBG Smith has done with your initiative? The need is clearly there. And you said you've been looking for competition.

AJ Jackson 01:50:24  Looking for competition? yeah. You know, I think, for the real estate folks, it's because, you know, there's easier ways to make money. There's, there's there's easier businesses to be in. you know, we talked about the complexity of the public private partnerships that we were doing at EAA. You know, there's complexity in this in this business, too. There's significant operational complexity, there's complexity in organizing the capital around it. and I think, the folks who are in the traditional affordable housing space are primarily in a different business. A lot of that is tax credits, which is a, a fee and formula business that's kind of different than than real estate investing.

AJ Jackson 01:51:08  And a lot of the folks who are in conventional real estate don't really understand, the, the affordable, the affordable side of it. So I think that's really been the, the challenge. But hopefully we're demonstrating that it's doable, that there is opportunity, and that will bring more people. And we're starting to see that. Right. You're starting to see some really big players organized capital around different types of housing affordability strategies. Folks like AAUW, Nuveen Federal Capital Partners here locally. So I think you are starting to see some of that. but we're early innings.

John Coe 01:51:44  What about property management? I mean, you obviously that's a very critical element, keeping your tenants retention, keeping the property physically nice looking, you know? yeah. Serving the tenants needs all that stuff. I mean, how do you oversee that process? I mean, you're a finance vehicle, so.

AJ Jackson 01:52:06  So we we do, provide management for most of the properties that we invest in. and, and primarily because that to your point, that management piece keeping the tenants happy.

AJ Jackson 01:52:21  Yes. is is is critical to a strategy where you're not where you're not pushing rents and you're relying on stability and, and not turnover. But also that building of community at the property is essential for the impact strategy that I talked about. This idea of upward mobility comes through economic connectedness, which is relationships with people at different at different strata. And so the the operation of the property is a critical part of what we consider to be our, our value add. And so we have an asset management team focused within Leo that does, the asset management for these, for these assets. and it's a very hands on, it's, it's a, it's a very, it's very hands on. How do you train, people for this? That's a good question. We're actually, we're actually thinking through a change to that right now. So previously working with the Washington Housing Conservancy, we would do a big, all hands educational thing that that actually the conservancy would lead, once or twice a year with all of the with all of the staff, we're now essentially thinking through what is the right model as we try to grow, hopefully more rapidly.

AJ Jackson 01:53:42  we don't think we can do that. Same. We don't think we can do that same thing as effectively. So, we're thinking through a couple of different models for both smaller on site trainings on a property specific basis, as well as kind of a virtual learning library. as to what is the right, right, you know, the right the right model for that right now, a lot of it relies on the senior leadership, on the property management side, the regional managers and the managing directors over the over the areas to really be steeped and immersed in the objectives, in the culture of what we're trying to do, and pushing that down to staff at the property level, particularly because, as you know, property management is a turnover industry, right. And so is you're bringing on new people, even if you're doing all hands trainings, you're not doing one every day. And so you're and you're bringing on new people, hopefully not every day but certainly every month. and so a lot of it right now, does rely on those regional managers, those area managers, to really be steeped and then pushing out as a part of the new, higher orientation.

AJ Jackson 01:54:50  but like I said, we're trying to trying to determine what is the best model for scaling that essentially culture. as we, as we as we go.

John Coe 01:55:05  And it's different in the affordable space than it is.

AJ Jackson 01:55:08  It it is. Although and I'd say the, the, the workforce housing space that's missing middle space is different from both affordable and fair market rate. are the residents? there is still a sales and marketing and heavy customer service component to workforce housing that's more akin to market rate, but there's also a compliance. And there's sometimes a resident services component that's more akin to affordable. It really straddles both. And and so it That's why we're so hands on with it, because there's not a lot of.

Speaker 3 01:55:50  Folks.

AJ Jackson 01:55:51  That, sort of third parties that are really steeped in this space. There are a lot that are steeped in the affordable lot of they're steeped in the market to get folks to do both. You it's going to be a hands on business. Right.

John Coe 01:56:04  So you're pioneering.

AJ Jackson 01:56:05  So, we are definitely we are definitely binary.

AJ Jackson 01:56:09  Maybe another reason folks aren't aren't in it. We're going to work it out. And when we when we're on, you know, two and a half point 0 or 3.0, then we'll get a flood of competition. and that'll be a good that'll be a good thing. but, you know, there are other there are groups starting to form in the industry, like the Multifamily Impact Collaborative, that are pioneering with us. I feel if you if it's there that we're partnering with them, however you want to say it. So, you know, I think there's a growing recognition that this is a distinct lane and that there are distinct needs, in this lane, different from the, the deeply affordable or the market.

John Coe 01:56:49  That's good. So how do we change the mindsets to accentuate differences among people, highlighting their strengths as a, as contributing people, both business and society?

AJ Jackson 01:57:03  you know, I'm going to go back to the equity lens. That's really what that to me, what that question is about is the is the equity lens and the, the notion of who am I not hearing from, right? Who am I not hearing from? And then how do I proactively go out and get them? But I'll tie it back again to the business case.

AJ Jackson 01:57:23  Why is that important to me? Right? What am I, what am I, what am I missing? Am I missing, a market that I don't see. Am I missing a customer that I don't see? Am I missing a risk in the entitlement process that I don't, that I that I'm not aware of because I've only got one kind of, you know, one point of view. I think that's when people started to internalize the benefit of getting more perspectives because you're getting more knowledge. That's really, I think, the value proposition that drives people, you know, to incorporate a broader set of voices, because, again, they can see it's it's in their own selfinterest. And at the end of the day, most things that people do are in their own selfinterest. And so, that articulation of, oh, I understand why this is good for my business, good for my project, good for my for my client pitching. you know, I think all of the, all of that is really the.

John Coe 01:58:27  As a black leader, what challenges have you faced in your career? How have you been able to make your voice heard and achieve the success you've had? Career.

AJ Jackson 01:58:35  You know, I've, I've been I've been fortunate in, in, in most of my career to have, like I said before, really good, really good bosses, really good leaders who, encouraged me to speak up, encouraged me to get engaged, and kind of pushed me to, to do things. and to me, that has made all the difference, right? Because that provides the confidence and over time, the experience, to speak your mind to get engaged, you know, to to not be afraid of raising your hand or sticking out, a little bit. And I think that's what holds a lot of folks back is that that fear of how am I going to be accepted or am I going to be hurt, or am I going to be looked at, looked at differently? so that's been the real, benefit that I've gotten is having people who pushed me to, to, to, to, you know, to speak, to speak out, to get to, to get engaged.

John Coe 01:59:41  What advice would you give to young black leaders today?

AJ Jackson 01:59:45  You know. You know, I, I think, that mentorship and mentorship is very important, right? Finding finding mentors that you can, that you can learn from and who will push you is very important. but I think you've got to develop the confidence to put your toe in the water, right, to get in the arena. I mean, I would I would tell you, you know, to to join you apply to join the real estate group to, to whatever MHC, whatever it is, coordinate or whatever sector of the industry you're in. But to to to get engaged, be present, be seen. You know, that is how you, I think ultimately identify the mentors. You know, I had, a professor in business school who told me to join Uli, which made all the difference in terms of just opening, you know, tons of tons of doors. I, I would I think that that there are there are a lot of people in the industry who just recognize talent and who want to be associated with talent, who want to hire talent, who want to help talent, help talent succeed.

AJ Jackson 02:01:02  But you've got to get out there to find to identify who those people are. And the only way that I know to do that is you got to join these groups or do the whole I mean, that's what I was doing with the Cole calling, and I was calling ten people every day. Right. There you go. and and finding and, you know, you got to be comfortable with rejection. It's just like sales, right? and and find so you can find the ones who actually will teach you something, who will take your call, who will return.

John Coe 02:01:29  So I'm going to make a little advertisement for my own efforts as well. So for listeners, I have a community and I've talked about it called The Iconic Journey and CRA. As of today, JBG Smith has invested $1,000 in that community, which I really appreciate, from Buenos Banerjee, the CFO who just notified me that. And we are advocating and we have minority members and we're encouraging people to join. I'm trying to develop a relationship with Project Destin, Cedric Bobo's group, and so I'm encouraging that.

John Coe 02:02:05  So that's one of the reasons I asked the question, of course. And, you know, mentorship is key. And I'll also point to one other episode on their podcast episode I had with two gentlemen, John Green and Joe Carroll in my interview. Both Harvard Business School graduates. Yep. And, Joe actually had a formula that he built for his career and his advocation for minority, growth and what he suggested on a year by year basis in your career, which I thought was phenomenal. So I encourage people to listen to that. So I stopped with that advertisement now. Then move on to the next question here. What were your biggest wins, losses, and most surprising events in your career?

AJ Jackson 02:02:55  that's a good question, John. you know, biggest wins, I don't know. We don't you know, I'm really pleased with what we've been able to do with the housing initiative. getting to the 3000 unit goal. really proving out this model, which I think can be really impactful and and transformative.

AJ Jackson 02:03:13  So I'm really excited about that. but I'm also, you know, equally proud of a lot of the work we did at EIA in really creating some, some, public private partnerships that the projects had real impact. But also, I think building out models and proofs of concept around ways to do to, to do business that were, that were really, you know, really impactful. you know, the biggest surprise in my career and one of the biggest, learning opportunities came when I was at the GSA. I was there, as I mentioned, I went in at the beginning of the, of the Bush administration. And so I was there, during 911. And, you know, obviously that was a surprise. we did not we did not, it was not in the playbook at all. and I spent the better part of the second half of my time there working on, essentially the reconstruction, reestablishment of the federal presence in lower Manhattan. folks, a lot of folks don't know. But, you know, World Trade Center six was a GSA building, actually a custom house.

AJ Jackson 02:04:27  But that building collapsed as well later in the day, because it essentially burned down. the federal presence is all concentrated down there at 290 Broadway and 2600 Plaza, basically in sort of the no go zone are, the the phone service that Verizon switched down. There was damaged. Phone service was knocked out. And so anyway we spent a lot of time working on, on other.

John Coe 02:04:51  Federal people.

AJ Jackson 02:04:51  That were there were there were some. Yeah, there was they're not, not out of not out of GSA. yeah. Not for GSA. but that was I mean, we were I was on the ground there, I don't know, the the 13th or probably the 13th or 14th century or something like that. I mean, it was so you.

John Coe 02:05:12  Saw the fresh air.

AJ Jackson 02:05:13  It was very fresh. It was very fresh. and so that, you know, that was the biggest surprise. Obviously, but also a real, learning opportunity. and just a mindset shift for, you know, for me, because obviously we were not, not prepared for that.

AJ Jackson 02:05:36  and not something that we had, you know, trained up on or thought about it all of a sudden, there are all these needs coming in from these different federal agencies, all these decisions to be made, all sorts of of actions to either take or not take.

John Coe 02:05:52  You and your.

AJ Jackson 02:05:52  Office. And I was no, actually, the administrator and I were in, in Philadelphia, for a meeting and got a call from the deputy administrator after the first plane went in, and then got a call back after the second one and started to make our way back to DC. We got as far as and they were. So we were going to go jump on an airplane, commercial airplane. and obviously all the flights started getting canceled. We jumped on the train, made it as far as Wilmington, Delaware, at which point a, you know, a national emergency was declared and the train service was stopped. So we got in touch with, the administrator and sent, the Federal Protective Service or, I'm sorry, the deputy administrator at the Federal Protective Service up to Wilmington to get us.

AJ Jackson 02:06:41  But you can imagine we get off the train in Wilmington. There's nobody on the platform. There's no one downtown. the Federal Protective Service is coming directly from DC up to Wilmington. We walk. I don't know how many blocks we walk from the. This is, you know, pre iPhone, pre jeeps walking around downtown when no one was there started knocking on the door of the police station. So the administrator and I show up. You talk about your this kind of your racial equity question. Two black men show up banging on the door of the police station, and the cops, you know, after in the midst of a terrorist attack. Right. And these these cops are kind of like, you know, what the hell? finally convinced them that we were actually, you know, with the federal government, that the federal police were coming to take us back to Washington. And could we shelter in the police station, until they got there. But anyway, got back to Washington, then turned around, went back to New York a couple days later.

AJ Jackson 02:07:30  but it it it just. Wow. The the the the confidence in decision making that I developed out of that experience because you had to keep making decisions and because there was no one else to ask. Right. And there was no and no one had no one had a playbook. you know, that was that was that's been really that's really stuck. Stuck with me. you know, it'd be nice if there was another way to learn that lesson, but, Yeah, it's it's really stuck with me.

John Coe 02:08:07  Wow. So what are your life priorities among family, work and giving back?

AJ Jackson 02:08:14  I'd say it like this. I'm a big believer in purpose. Thinking about what your what your purpose is and then orienting your life and your behaviors kind of towards that purpose. and I think that allows you to let priorities shift, right? Because everything can't be number one all the time. And, one of the things someone said to me in business school, which is another valuable lessons, is, there is no both, and it's all trade offs, right? There's no there's someone else talking about work life balance.

AJ Jackson 02:08:47  There's no balance. It's just trade offs. So what do you want to do more of? What do you do less of. And those trade offs shift at different at different points in time. Right. And so sometimes family is the number one priority. Sometimes it's not the number one priority. It's always important. But sometimes you're you're you're doing something else. Sometimes your kids or your spouse really needs you and you've got to you got to, you know, drop everything and do that. and so I really think about, you know, I, I would like to do some real permanent good. And so where do I have opportunities to do that? And on the work side, on the family side, on the, on the personal side and which opportunities are most time sensitive or, or the ripest at a given point in time. And then, you know, candidly, the priorities shift depending depending on, on, on, you know, on where and where this where this fall. but, I'm fortunate in that I should say, I'm fortunate in that because my wife has a similar kind of mindset.

AJ Jackson 02:09:47  And so, you know, we can we can balance off because it doesn't work if everyone's not bought into shifting priorities. well.

John Coe 02:09:57  You know, sometimes you have more energy than she does, and vice versa. What do you need?

AJ Jackson 02:10:02  You know, it's it's.

John Coe 02:10:03  I need your help today.

Speaker 4 02:10:06  It's exactly, exactly, exactly.

AJ Jackson 02:10:09  It's like. It's like our, you know, it's it's our it's our parenting. it's our parenting joke. You know, as long as we're both not irrational at the same time, then it's fine, right? It's it's time.

John Coe 02:10:24  Yes. What advice would you give your 25 year old self today?

AJ Jackson 02:10:30  You know, I you gave me that question, but I still didn't I, I've thought about it and I still, I, I think I would, I would network more, I would, I would network more. I don't think I did enough of that when I was, when I was younger. and I think, I think that's probably the main advice. I mean, I would say maybe you got to try a lot of you got to try a lot of stuff to figure out what, you know, kind of what your lane is.

AJ Jackson 02:11:07  you know, and maybe so maybe feel a little bit faster, but, but, Yeah. Okay.

John Coe 02:11:17  So if you could post a statement on a billboard on the Capitol Beltway for millions to see, what would it say? RJ?

AJ Jackson 02:11:26  you know, I've been thinking about this all weekend, so this is, like, the hardest. This is the hardest question. you know, and, but.

John Coe 02:11:35  You want to make an.

AJ Jackson 02:11:36  Impact, you know? Well, so I yeah, I've been thinking about this, and I think that I think I keep coming back to the same conclusion, which is I think my billboard is already posted, because I walk to work. I'm a public transit guy most of the time, so I don't drive a lot. But, I have been on the Beltway and, you know, the state of Maryland has put up these new signs when you enter Maryland, which I guess every governor gets to put a phrase on the sign. And so Wes Morris put this phrase on the sign that says Stronger Together.

AJ Jackson 02:12:07  and I think that's probably, you know, I can't think of a more articulate way to, to, to, you know, to, to say it. But, you know, in my mind there's a couple of things, right? One is we have we live in a state of of of abundance. And if we take that mindset of abundance, we could really do a lot more than we think we can do. Of course, because we come out a lot with a mindset of scarcity. And I think that Stronger Together statement really kind of gets to that to that point. and the other point is actually it's a, it's a point, to stoic sort of philosophy point, which is, you know, what's bad for the hive can't be good for the bees. and I think that's something that we seem to have forgotten in, in some, in some instances. and again, I think that that kind of stronger together is a is a very simple and eloquent way of, of getting at that point of, look, we have the opportunity to do so much.

AJ Jackson 02:13:10  And if we're pulling the or, in the same, in the same direction together, we can make, you know, real, real permanent. Good. So that's that's my billboard. it's already up, so I appreciate it.

John Coe 02:13:23  RJ, thank you very much for your time. I really appreciate it. I thought it was an excellent interview.

AJ Jackson 02:13:29  Well, I hope you can, you can edit it down to make me sound good. Really appreciate it. Thank you very.

John Coe 02:13:33  Much.