EP 665 - Solving America’s Homeless Problem Through Affordable Housing With Alan Graham Of Austin's Community First Village

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This is the no Closer show where you get the latest developments in distressed note investing and learn the secrets of how you can control millions of dollars worth of property for panties on the dollar. Get educated and entertained by someone who has closed thousands of deals and lives to support you in achieving the same. Now here's your host, CEO of We Close Nodes, Scott Carson.

Good morning, good afternoon and good evening, everybody. Welcome to this episode of the Note Closure Show. As always, Scott Carson. Excited to be here today and I am really jacked up to have a very special guest. He's known widely throughout Austin, Texas and the world these days. I say it's truly being a not only an amazing individual, someone with a huge heart, humanitarian, some would say a angel walking the earth, doing God's work, helping Austin's less fortunate in the homeless community here for over 20 years. And you know, we talk a lot about helping people stay in their homes. People have gone through financial hiccups and working to keep our borrowers in our homes as we're buying the debt. And this guy is truly doing something amazing with Austin's most talked about community, Community First Village. And he's also the founder of over 20 years for the Mobile Loaves and Fishes here in Austin, Texas. And so, Alan Graham, we are honored to have you here on the no Closer show today. How's it going today?

Yeah, awesome, Scott. Thanks, brother. I appreciate being invited. Humbled. So this will be fun.

Yeah, definitely. So before you got into where you do, let's talk a little about what you were doing before you started Mobile Loaves and fishes back in 1998.

Yeah, well, in 1978 I got into the real estate business, man. I was going to the University of Texas, hated school and sitting in a photomat kiosk for a part time job. And a buddy of mine in the real estate business comes up in a brand new white mercury marquee wearing a suit with the air conditioning blowing on him. And that looked like a better deal to me than where I was and got into the real estate business, had a moderately successful career, got pretty heavily into development and toward the end of that career that juxtaposed over the founding of Mobile Loads and Fishes. We were developing air cargo facilities on airports around the country.

That's awesome. And you know, starting mobile ovens fishes with a couple of your buddies out of the back of green minivan I believe is the word we're starting out there for you. What was kind of that seed that sprout, that thought that helped, that brought you guys Together to do that and really decided you wanted to make a difference.

Well, the seed was really a retreat, a men's retreat that I went on in October of 96. Where had I known that men were going to be holding hands and doing that bromance, hugging it out, I'd have never gone. That was not my spirituality. But it turns out it is. And it was an incredible experience, Scott, over about 30 hours where I just kind of had this revelation and that I just began to kind of ask, God, what do you want me to do, bro? And it started with the little things. And honestly, to go feed people on the streets out of the back of a green minivan was not a big thing, but boy, did it morph into something pretty huge. So that's kind of how I explained that deal in a short version.

Sure. No, that makes a lot of sense because there's obviously a long, long, winding story along with it. We'll see everybody that. But you morphed into something amazing. 1:51 plus acres just outside of Austin, Texas, and just absolutely a breathtaking community. And I want to highlight that word community, because that is such a focal point throughout your ministry and bringing people together and community first. Can we talk a little about that and why that's so important with your success?

Well, it's been a great learning process and there's been lots of tools along the way that have helped us put the skin on the skeleton of what it means to live in community. But look, it goes back when my kids were little and we would jump in the car over the summertime and drive for 5,000 miles and we camp and stay in RV parks and I got enamored with these RV parks that there was this inherent sense of community. I remember in one of them, a million dollar prevost, at least a million. That was in the 1990s, driving in and parking next to what was probably a 10 or $12,000 Jayco bunkhouse. And the families would come out and they would just hang out, cook burgers, go to the movie nights. And so when the idea in 2004 got into my brain to go out and buy one RV and lift one person up off the streets into a privately owned RV park, it was because of that inherent sense of community that I experienced when my kids were young. And that's the foundation that we've been building on, because I really believe that you and I desire to be in community. And in a lot of ways, the way that we're living now in these subdivisions and these hermetically Sealed single family sarcophaguses that we call the American dream. With the sport court, swimming pool, barbecue pits in the backyard. And we don't know our neighbors. That's not how I grew up. You know, I grew up getting my butt beat by the neighbor next door. If we didn't behave right, you know, you could get a spanking from any house.

Embrace that. Definitely.

Yeah.

As they say, it takes a village to raise an idiot, right?

It does. And we just don't know our neighbors anymore. In fact, we're probably afraid of our neighbors.

So that is something that is completely. If you guys don't have an opportunity for listening to this, we're gonna throw some links in the description below. You gotta go watch some stuff and see the tour. The community first village Tour is about 12 minute video, but well worth it. Talking about and it's so unique and I can see with your real estate development background coming in is really, I won't say self contained, but everything works so well together there. You're up to how many RVs, mobile homes or tiny homes in there now?

Yeah, well by the time we finish phase two, we'll be at 5:50 and then we just announced 1400 home addition to that on another 126, 27 acres that we have. And we're pretty sighted. It's going to get pretty big.

Now the one thing that really popped out is you're not taking any money from HUD or government. It's all privately funded. Is that correct?

Yeah, I just always like to caution people on that deal. You know, there are areas of government that we all feast off of. Right. And mobile O's and Fishers is no different. And so when we go out and develop something like this, our city participates with us on fee waivers on development fees and that could be substantial. We also need water and wastewater and electricity from city owned utilities and that's important. Sometimes there's off site utility costs because of the work that we do. They will fund and we need that. We also partner with a number of different agencies that all work with the homeless population. And many of those agencies are funded with funding that comes from federal, state and local government to help provide case management and things like that for people. So government does play an important role. But all of our capital and primarily all of our operating expenses comes from private individual philanthropy. And that's how we operate and it's been a great strategy for us.

Yeah. And one of the things that is unique about what you're doing out there is people are Paying rent. They've got to pay rent to stay out there, correct?

That's correct. And so that's our number one rule. People ask us, what are the rules? Alan and I go, well, they're the same rules you live by. Rule number one is you must pay rent. Everybody's in it, nobody gets away from it. There is no free rent, believe it or not. Nobody gets a free ride, no matter what you think the government does and how they subsidize. I've seen people kicked out of Section 8 government housing for not paying their $50 a month rent. Rule number two is you must be obedient to civil law. That applies to every one of us. All of us break it. By the way, I don't know anybody that doesn't. I've been pulled over many times for speeding and I could go down a list of other walls that broken, but I'm going to keep those in my skeleton closet. And then look, we live in a community here that's governed by rules like a homeowner's association would be or a condo deal. And they're pretty simple rules. So just pay your rent, really and truly. And you know what I like, just don't be an ass.

Right. That goes a long way. Treat people like you want the golden rule. Treat people like you want to be treated right.

It really is. That's it then. There's a lot of things you can get away with in terms of what you do in the privacy of your own home. That's none of my business. Right.

What I really loved about the visit out there, and it's been more time, research and everything like that, is you've really got the community out there. Not just living out there, but they're working out there in a variety of things. You're also providing places for them to showcase their talents, the artistic side of things or the handcrafting of goods and stuff like that. But you've also got the bed and breakfast out there that you operate, the auto care center, you know, for an oil chain and tune up, stuff like that. That has got to have been probably one of the most fulfilling things for a lot of people out there that want to work. I think most people want to work and want to make an honest salary. Would you agree to that?

Well, I've never met anyone that didn't want to do that. And the evolution of all that stuff that you just mentioned came out of my observation, why would anyone want a panhandle? It's nickels, dimes and quarters with a very Low success rate. That amounts to money that nobody on the planet can actually live on. And then I realized that when I grew up and when I moved to Austin, there were no panhandlers in the Houston area where I came from or Austin. It was men and women on street corners selling newspapers, bottles of water, flowers, cow skulls, cow skins, and I'm sure, Scott, your favorite velvet Elvis art.

That's right, baby.

Yeah. And we've outlawed all that stuff. You can't do that stuff anymore. And so the only remaining bastion of entrepreneurialism for people that live in extreme poverty is the first Amendment, free speech, right to hold a sign and beg. And I find that ridiculous. Go to Mexico right now and you're going to get assaulted by a gauntlet of entrepreneurs. Come to the United States of America, arguably the most abundant country ever in the history of the world, and you're assaulted by a gauntlet of beggars. And so I realized that people want to work. Panhandling is work. That's not easy. I've done it with it. It's humiliating, it's pathetic. And so we wanted to create an environment that was purposeful. And as a result, since We've been here five and a half years, our neighbors have earned about $3.5 million, about a million last year alone. It's incredible.

It is incredible. Especially in a time of pandemic and everything like that. Amazing.

Our neighbors were living large. And when I say large, it's not large in the way people think. But let me tell you, I did a podcast with one of my friends who grew up in pretty extreme American poverty. And he said when he moved in here, he felt like he moved into the rich neighborhood.

Well, it was nothing that felt poor about community because it is, it is nice. It is very clean. You see people stepping over all the time to pick up scraps. They really do take the pride in that community there, the home. And I honestly understand how it's self policed a lot of times. You were talking about how you've had very few calls of any type of criminal activity or anything like that, or the police being called or even the surprising was the fact that was it nine incidences of theft and it was from kids from the next door housing community, not yours, right?

Yeah, the middle class housing, single familyhood. Not a project, just to put it into context. But that's all right. You know, what we're trying to do is let people know that these aren't criminals, right? These aren't your pillagers and your plunderers. That's not who this is.

With homelessness seeming to grow, as they say. You didn't mention it was about the same amount it's been for the last 10 years in Austin, if I remember correctly.

As far as well as a per capita percentage of the population growth, homelessness.

Has remained flat besides 100 and some odd acres. And you see all different cities across the country trying to work to solve that. Austin's doing something different obviously with hotels and trying to bring things in. You've probably been reached out to by a ton of other cities and community leaders across the country to review what you're doing and doing that. What's your answer? I mean if you have one. We don't may not have that time for it, but you know, give it an answer. Is it a change in mindset that our leaders need to change or people need to change or just kind of start to ground one and start helping one man at a time and go from there?

Well, we have a replication model pre pandemic. It went on pause once Covid hit March of last year, but we have a three day symposium. Over 400 people from 150 cities, 32 states have been here, spent three days with us. We have a post symposium process that they can enter in that even includes a six month cohort where they fly into Austin three or four times and dive deep into the work we do. We have several replications going on around the country as we speak right now. We believe that we have a new movement and how we can address this issue. And Scott, movements take a while to really kick in. So I think it's a 20 year process for people and I would legitimately say that we're four or five years into that 20 year deal.

Yeah, I mean it does take time to move things. But thinking back now from 98, did you have any thought that community first or mobile loaves and Fishes would be where it's at today when you guys started off?

Well, from a community first point of view, the answer would be no. I had no idea then. As a serial entrepreneur, a dreamer, I've always thought all my ideas were the greatest ideas on the planet. But also was realizing by 98 that not all of my ideas are that great, having had to flush a few of my ideas down the toilet. But look, I thought that I could replicate the truck operation all over the US and that that would be a good idea. God just had something different in mind and here's what we ended up doing. So.

Right. Well that's what they Always say, man plans and God laughs.

Yeah, that's right. Yeah. Yeah, that's right.

Has there been any huge hurdle over the last 20 years? I mean, there's probably hurdles every day and a variety of different things, but any hurdle that you guys have had to overcome, that really stands out more. So.

Yeah. Well, the big hurdle for anyone in this line of work is what we call nimby, not my backyard. And that is fueled by something called zoning. Discretionary land use, suggesting that a use such as whatever is not appropriate in this particular neighborhood. That applies to Walmart as much as it applies to the chronically homeless or affordable housing. And so somehow, culturally, we have to grapple with that issue as a culture. And I'm afraid that the only way. I don't know how you get rid of it without getting rid of zoning. We just can't continue to sustain ourselves without making room for people that. That don't make much money. And we should all be intolerant of crime. But I can tell you that property values have not dropped in my neighborhood. I mean, if you wanted to buy a house next door right now, if it came on the market for $350,000 today, you better offer 50, 60, $70,000 more than that if you want to own a house. I've got one kid that just put in an offer on a house not in the neighborhood next door, but in Austin, in a neighborhood that was the struggling neighborhood in North Austin, and offered 50, 60 over what they asked for the house. It's just. This doesn't have anything to do with that. There is no crime or nothing material, and we can't operate on the what if. What if somebody comes over here? Well, what if. Sometimes bad things happen in the world in a way of preventing that.

Now, what's kind of the process for somebody moving into community? First they have to go through counseling, they have to go through drug tests, or how does somebody kind of find their way into community first? Through churches or other groups or. How's that kind of qualification process?

Yeah, and so we operate off of a definition that you have to be an unaccompanied male or female, no children with one or more disabilities, having lived on the streets of Austin for at least one year. And so the average age here is 58 years old. The average number of years on the streets, 10 years.

Wow.

65% of our people have two or more comorbid diseases, and these diseases can include addiction. We don't drug test people when they come in. We have active addicts that move in to the community. 98% of our addicts are great people, just like the addicts and the alcoholics that, you know, good people. And then we monitor, you know, I would say about a half a dozen people out of the 270 that live here right now that their problem is a little bit deeper and starting to have an impact on the community. And we monitor that and do the best we can to help manage that. Best if they come in through one of the about a dozen partner agencies that we work with that work in the homeless space, we love for them to have case managers when they come in. They're not being tested or there's no therapy or any of that. It's really about getting them off the streets first. And then we'll begin to address any of the other issues. If we feel like that we have to address those issues. It does take a while to get in. It's just the nature of the supply demand issue. The demand is a whole lot higher than the supply. So.

And when you're finished with the new development, you said you'll have, what was it, closer to 1600? The third is 1400 new homes.

Well, the phase three and four will add 1400 to the 550. So we'll be nearly 2000 homes somewhere around that number.

So you won't be a village anymore. You will be your own city in some cases.

Yeah, yeah.

Is there any, like, growing pains with that that you foresee, and you've probably already identified those and stuff like that, but growing pains to get there. Is it raising funds? Is it finding RVs or homes to build, or what's going to be your biggest hurdle to complete that?

Well, that part of it is relatively easy. It's really scaling an operation that is going to grow from managing, you know, just under 300 people to managing under 2,000 people. So there will be a staffing scale issue. And then right now we build about 100 homes a year. We're a legit home builder.

Right.

And we will move into building about 400 homes a year. So what does it take to scale that? So that's an issue. Our OPEX model will grow, will probably multiply by 3x roughly, and that's an issue. We're about an $8 million OpEx deal right now that'll run into the $20 million range, give or take there. And then with the sheer numbers, how do you plan into that community, the level of intimacy? We have two brilliant architects that are here full time on staff, and one of them came up with an idea called the Neighborhoods of Knowingness that I think it'll win awards. That's my prediction. The concept and the implementation of that concept is going to be pretty powerful.

That's awesome. Now with the average year being homeless on there and then coming out of that into the community there, what do you see is maybe kind of the. I won't say shock and awe, but there's got to be some shock and awe a little bit from some people coming into the community who have lived differently the last 10 years. I'm sure it's probably mostly in a good aspect of things, but do you see a little bit of a transition period for people just kind of maybe let go because we had a conversation talking about people were there and how stressful it is living homeless and the violence that goes along with it, especially for women. Do you see people just kind of this whole kind of layer of armor fall off a little bit after a while?

Well, we're always bringing who we are to the table wherever we go. So you and I get to bring our white guy culture. We might be conservative or liberal. We'll bring that to the table. We'll bring our lived experiences to the table. And our brothers and sisters up off the streets are the same thing. So if their average time on the streets is 10 years, which means some of them were there for 40 years, it's a cultural shock. And it's not unusual to move somebody in and see them sleeping on their front porch for a while. I knew somebody that didn't even sleep in their bed for probably two, three months. What psychologically drives that? I don't know. We just live into it and join them in that struggle. I have people that have been in here three or four years and are just now kind of acclimating to this. So it takes time and it's going to be different for just about every person that moves in and their own circumstances are going to dictate that. What we do is we demand improvement, but we're flexible on the timing.

There you go. That makes that. I like how you put that there for you. Now you've got a huge volunteer staff out there, but how many full time staff members do you have there at Community First? And then maybe it's probably a combination of people that help Bubble loaves and fishes and also Community First. Correct.

I'm not sure what the staff count is right now. We're in the 60s. We'll be probably at 75 by the end of the year, somewhere around that number. The budget this year Was to add about 15 people. And we're aggressively hiring right now. There's probably seven, eight job descriptions out right now. Normally, pre Covid, we averaged about 285 volunteers a week coming out here. That went down to essentially zero. It's starting to come back now. I don't know what the numbers would be, but nowhere near that. So we're excited with the vaccine and hopefully we're going to be back up to full operating here in a few months. But we do need to see the local numbers drop pretty good. We were thinking they were going to drop by mid April into phase two, but, you know, we're still kind of stuck in this phase three thing.

So we'll see right exactly there. Now, with the 200 plus community members living out there, you were able to get Austin Metro to put a bus stop on there. How many of the community members on average, you may not know the exact amount, but are transitioned to jobs and other things outside of community first.

That's extremely rare. Deal. You know, I really know of a very few that work off site. I would say under four, five people. You know, our population, they're not employable in the conventional sense. And about 70 to 80% of our neighbors are earning SSI or SSDI. They are declared disabled. And we talked about the disability thing earlier, and then the balance can work on site. I mean, a million bucks divided amongst a lot of people creates a nice little boost in your income. So not very many. They're just not okay.

I wanted to bring that because it was such a beautiful thing on how everybody's working together. The gardens and, you know, the living quarters, the housekeeping, the bed and breakfast. Is the community in back up and working?

I think by the end of June, it'll be back up and going.

So good stuff there. Now, one of the things that I was always amazed with is just seeing the community. And then you mentioned one thing. When somebody passes, how everybody comes together just to stand around and be there in silence or in the community healing aspect of things, when somebody does pass in the community. And I found that amazing because I think so many people on the website there, you always talk about how really probably the number one factor for homelessness is a lack or loss of family.

Yeah. And so I would say that when somebody passes away, on average about 80 to 100 people will gather outside their home and will not leave until the body is actually removed from their home. And it's a beautiful, emotional. It could be several hours, five, six, seven hours of time out there. It's amazing to watch.

It definitely is. I also love the fact how you mentioned, and we were able to see, actually talk with some of the women there, how every home kind of has a custom decoration to fit the person moving in. It's such a unique and touching. So it really is like a building a home versus something that's a sterile box like a lot of other communities are using.

Right? Yeah. Well, when you move in, you're going to move into a completely furnished, ready to go home, brand new beds, bedding. Nobody ever sleeps on the bed that another human slept on. And we interview you prior to moving in, find out your favorite colors and themes, and we try to meet that somehow.

Definitely amazing. Alan, what would you say is the number one need right now for mobile oven fishes or community first? What's one big need that you're working on towards, obviously, besides the growth there, but what's one big underlying need that the community is looking for besides hiring a few people?

Scott, the biggest need we have is to get as many people out here to see what you have seen as possible. And when people come out here, if they're inspired the way that you are, and we believe that they will, then we want them to jump in with us. We want them to say to themselves from within their heart, I love what those guys are doing. I want to join together. It's just like this podcast right now. We're joining together. You're going to blow us out. And who knows the impact that this will have. And then we just trust that in that whole process, the giant pile of money that we need to do, all the work that we need will ultimately come in. But it's heart first, pocket second. And the way that we get there is by getting people out here so they can see what's possible in our city. We want to build hope within our city of understanding that what they view as being a mess out there on the streets is actually very mitigatable with the right strategy and that what we are in possession of here at Bubble Loaves and Fishes is a very large piece of that strategy. We're not the only thing, but we're a big thing.

Yeah. Now, are you guys starting tours back up again?

I love them. Just like we did. We're not doing the big public tours yet that we were doing. We did three of those a week, but private tours all day long. All you have to do is email us and we're ready to get you out.

Yeah, definitely. And I'll tell you this, when you're on a Tour. Everybody knows Alan. Everybody knows everybody out there, which is one of the most amazing things and knows everybody's story. And it is a community. And you guys, I don't care where you're at, you've got to make time. You're making Austin. You got to get out and see community first village there. Amazing. Alan, just absolutely.

That 12 minute video you talked about is pretty awesome, but there's nothing like coming out here and doing it yourself.

So you're exactly right. 12 minute video, great little teaser piece. But it has nothing to do. I mean photos do not do it justice compared to everything out there. So Alan, what's the best way for people to get involved or to find out how they can connect? Is the website Mobile Loaves and Fishes or what's the best, best way to go?

Yeah, yeah, the website mlf.org that's mobile loaves and fishes. Mike Lima, frank.org and my email is alanlf.org you're welcome to email me. I've got an executive assistant that'll help me schedule things, so please come out. But there's lots of great stuff at our website. It's actually very well done if I may say so myself. Website and always up to date. Lots of articles, we get lots of publicity from all the news medias. So just go check all that out and then give us a shout. We'd love to have you out here.

Awesome. Well, Alan, thanks so much for coming on the Nooklid show podcast today and just being an inspiration and inciting inspiration, motivation and goodness and so many people out there.

Yeah, awesome. And way to go wearing the hat, bro.

I love the hat. I mean it's great. Gotten quite a few compliments on it actually and I'm glad to be walking both the board for it out there.

Great. Appreciate it.

Thank you. Alright guys and gals, that's going to wrap it up for this episode of the Nook Clothes Show. Go do something. Helping one person at a time can go a long way. And how do you start a movement? How do you start a blaze? You like one match and go from there. And Alan's really created such a huge blaze of goodness and helping our fellow man out there, especially the less fortunate out there. So go out, take some action everybody and we'll see you all at the top, everybody. Bye. Sam Sat.