Brookhill: How one of Charlotte’s most complicated and misunderstood developments could end up a success story

Demetrice Locket moved into this community off of South Tryon Street in 1993. At 56 years old that’s almost half her lifetime ago. She knows this much-debated place better than just about anyone, and she’s proud to be here, empty lots and boarded-up buildings and all.

“I love it,” Locket says. “I hate to say that I was mad as hell — excuse my language — but I was mad as hell that the news makes it look like we’re so bad over here, because we’re not. Not all low-income neighborhoods are bad. To me, your best people come from low income.”

Earlier this month, Locket and her neighbors caught wind of potentially world-altering news: After years of logistical whack-a-mole, a developer from Raleigh has purchased the 36-acre low-income housing community.

The developer, in partnership with a local community development corporation, promises to replace the outdated Brookhill buildings with a 324-unit complex that includes a striking 162 units for people making less than 60 percent of the area’s median income. In a city that says it’s devoted to affordable housing, few new projects in recent years even come close to that commitment to the lowest wage earners.

The deal would untangle one of Charlotte’s most perplexing housing knots. Built in 1950 by the late C.D. Spangler Sr., Brookhill’s units have outlived their design. Roofs leak, plumbing fails, floors rot. Several buildings have been condemned and torn down. Meanwhile, all around them, South End pops with high-end condos and restaurants and breweries. Less than a mile away, Lowe’s is building a 23-story tech hub. A few streets over, a new luxury apartment complex has one-bedroom apartments for $1,800 a month.

But it’s been almost impossible to make progress on the Brookhill property because of its ownership structure.

Spangler’s family still owns the land, a couple of generations down the line. His son, C.D. Spangler Jr., the highly respected billionaire and former president of the University of North Carolina, died two years ago at 86.

At the center of the tangle is a 99-year ground lease the family put on the Brookhill property in 1950. In a ground lease, a tenant can develop on the land, but must return the property and all improvements to the owners at the end of the lease.

The group that assumed control of Brookhill’s ground lease in the late 2000s struggled to find a developer to take on a project here, knowing that they’ll have to turn valuable investments back to the landowners on November 1, 2049. If nothing happens in the next handful of years, there will be almost no time left for any group to recoup its investment.

While the complications objectively make sense in legal and financial terms, it’s harder to measure the emotional toll on people like Locket who don’t know where the hands of wealth will steer them next.

After a recent raise, Locket makes $17 an hour, or about $35,000 a year, keeping inventory and taking orders for plastics and replacement human bone and tissue at Atrium Health. That’s enough to comfortably cover her $480-a-month rent. She raised two kids in Brookhill by herself — her son went off to graduate from Benedict College, and her daughter is now a senior at UNC Greensboro.

She’s moved three times within the complex. Built with 418 units in 1950, Brookhill now has about 150 occupied.

Plenty of people from outside of Brookhill have opinions about Brookhill. Passersby on South Tryon wonder why the old buildings are still there at all, with the $400,000 condos being built in the neighborhood across the street. Some of the city’s most powerful people have argued for years over how to move forward.

Meanwhile, Locket and her neighbors just keep on living here. She leaves for work each morning on the bus and itches to come back here each night. Her voice trembles when she talks about the uncertainty of Brookhill’s future. For years, she’s hoped that whenever the inevitable day came when someone had a plan to transform the neighborhood, the new developer would see people like her — someone who’s made the same commute to the same hospital for 33 years — and help them find a path to stay here.

One day last week, Tom Hendrickson slid a sheet of paper across a table toward me. It had the outline of the current Brookhill property, and it was covered in different colors.

“This is not a bunch of DNA charts,” he said.

He wanted to prove a point to me after I asked how he planned to keep track of everybody who has to move away and come back.

“‘Come back’ implies they have to leave,” he shot back. “They don’t have to leave.”

On the paper, black marks cover units that have already been demolished. Red units are ready for demolition. Green is occupied. Blue is occupied but in default. Yellow is vacant. Orange is re-leaseable with some improvements.

Hendrickson seems to enjoy puzzles like these. Growing up in rural eastern North Carolina, his uncle put him in charge of running a convenience store in the middle of tobacco land. Each day, workers came in from the fields for a short lunch, and Tom’s job was to make sure they were in and out. Just a boy, he made change in seconds, without a calculator.

Now he’s trying to solve one of Charlotte’s most challenging problems.

By shifting just a few residents from one color on his sheet to another over the next couple of years, Hendrickson says his team with Lookout Ventures and the Brookhill Land Lease Ventures can keep all current residents in Brookhill while the first phase of residential construction begins.

Then, the residents will have the option to apply to move into one of the new affordable units, which he hopes to hold close to their current rents. His plan calls for 65 of the units to be reserved for people making 30 percent or less of the area’s median income — or $23,700 for a family of four — and 97 for people like Locket who fall in between 30 and 60 percent of the median income.

That’s no small number. Compare it to a 1,200-unit complex set to be developed in Ballantyne. There, the inclusion of affordable housing meant keeping 176 units set aside for people making 80 percent of the AMI — or about $63,000 for a family of four.

Or compare it to Charlotte’s other construction proposal on historically meaningful land, Brooklyn Village in Second Ward. There, a developer plans to put 1,243 units on land that in the 1950s was the heartbeat of the city’s African-American community. Of those, 114 (about 10 percent) are currently designated for people making between 30 and 80 percent AMI.

That leads to the biggest hurdle in Hendrickson’s plan: He’s secured the bulk of financing through a new program from Freddie Mac, but still he’ll need $15 million from the city’s affordable-housing funds — the Housing Trust Fund and the Housing Opportunity Investment Fund.

Combined, the two funds raised a little more than $100 million in recent years.

“I can’t think of a development that has this many 30 percent units,” says Ray McKinnon, senior pastor at South Tryon Community Methodist Church and the president of the South Tryon Community Development Corporation, a key player in unlocking the deal. “And you’re getting that for the lifetime of this development. I’ve been in so many meetings about this where people were basically just saying there’s basically no way you can overcome it. And we’ve gotten there.”

How, though?

To understand how Brookhill arrived here is to understand how money works — and has worked — in Charlotte. Brookhill’s story is the city’s story.

Built for $2.3 million in 1950, it contained 332 two-bedroom units to rent for $9.50 a week, 44 one-bedroom units for $8.50 a week, and 42 three-bedroom units for $10.50 a week.

On August 5, 1950, the Observer ran the headline: “September work date set for 418-unit Negro Housing.”

In January 1951, 75 families moved in.

Mel Watt remembers passing the neighborhood as a teenager. The former congressman and head of the Federal Housing Finance Agency grew up out west of the airport, but when he was a junior the school system placed him at the all-black York Road High closer to Uptown. He drove the school bus — something that was common for students at the time — and remembers making stops in the Brookhill community.

“I don’t think anybody thought of it as poor; I certainly I didn’t think of myself as being poor. In retrospect, we all were poor,” he says. “But it was a stable neighborhood.”

A few years later, though, the buildings showed signs of wear. In June 1968, the city’s housing inspector found several violations. The Spanglers then sought public funds to keep the development updated.

Still, the development carried on with little pressure from the outside until the 1990s, when city leaders formed a vision for a revitalized neighborhood that included a light-rail line and tons of business and commercial properties taking over old warehouses. They would call the neighborhood … hang on … “South End.”

The Lynx Blue Line opened in 2007. The next year, local developer Greg Pappanastos approached prominent architect Terry Shook about possibly joining in the formation of Brookhill Village Two, LLC, and purchasing the land lease there. Pappanastos had seen Shook’s vision to transform Double Oaks — another property affiliated with the Spanglers — and turn it into Brightwalk, which stands today as a successful mixed-income community off Statesville Avenue.

At 66, Shook has shaped several Charlotte neighborhoods. He was a UNC Charlotte student when he helped create the vision for what’s now Fourth Ward, and later he was among the people driving South End.

But in 2008, the economy crashed. Development around the city slowed to a near standstill.

On September 20, 2016, Charlotte erupted into protests in the aftermath of a police shooting of a black resident named Keith Lamont Scott. Listening to the protestors that week, their frustrations were as much about economic inequality in Charlotte as they were the specific shooting.

Three days later, on September 23, CMPD and the federal government filed a forfeiture complaint on Brookhill. The complaint said that between 2011 and 2016 CMPD had executed at least 20 search warrants of residences there, including: “marijuana, marijuana packaged in bags for sale, live marijuana plants growing in pots, powder cocaine, crack cocaine, crack cocaine packaged for sale, stolen firearms, loaded handguns and shotguns, as well as other paraphernalia consistent with narcotics trafficking.”

Three months later, on January 11, 2017, Brookhill Land (the Spangler group) sued Brookhill Village Two (the Shook and Pappanastos group), arguing, essentially, that the lease-holders were responsible for the troubles that led to the forfeiture and that they were now in violation of their agreement.

Around that same time, affordable housing moved to the forefront in nearly every boardroom in Charlotte.

Almost to the point of overcorrecting. Over the past few months, I’ve had conversations with a handful of nonprofit leaders who say the response to almost any fundraising request of any sort nowadays is, That’s nice, but what are you doing for housing?

The city put a $50 million housing bond on the 2018 ballot, which voters approved; Foundation For the Carolinas led an effort to raise more than $50 million in private funds to match. Much of that money goes to supplement developers who save some units for income-qualified renters.

Meanwhile, Brookhill gained citywide attention with the introduction of an exhibit at the Harvey B. Gantt Center. Photographer Alvin Jacobs embedded himself in the community for months in 2018, capturing black and white images of kids playing in sprinklers and clothes hanging on lines with the skyline soaring in the background. For many, the exhibit offered the first look at life behind the buildings with boarded-up windows on South Tryon.

Later that January, Shook and McKinnon arranged a meeting with community members to discuss a way forward. Shook showed a Powerpoint presentation that ended with several slides outlining how his group could hand the land to a nonprofit community development corporation in a bargain sale — in which the buyer only pays for outstanding loans and debts and other commitments — and then the CDC would sell it to a suitable developer to cover those costs.

After the meeting, they all agreed, they needed to find a developer willing to wrestle with the numbers and legal issues, while still preserving the integrity of the property’s affordable-housing DNA.

“A lot of developers in this town with good intentions wanted to do something,” Shook says. “But they didn’t have the keys that fit in the lock.”

Over the past year or so, Hendrickson has renegotiated the land lease with the attorneys representing Brookhill Land. He presented his proposal to the U.S. Attorney and got the lawsuit settled — on the condition he builds what he says he’ll build.

(Plus, the settlement says, Hendrickson’s Brookhill Land Lease Ventures must conduct: a Crime Prevention Through Environmental Design and a criminal screening of all tenant applications. Also, they must reject any applicants with drug distribution or violent convictions in the past five years; install good nighttime lighting; have on-site management; ban people conducting criminal activity; enforce lease agreements with tenants; and make efforts to not displace elderly residents.)

Hendrickson hopes to make money off the deal — he’s a developer, after all. But he knows it’ll only come in time. After the residential units go up, he plans to use the remainder of the property for commercial buildings. He envisions a health-care facility, restaurants, and breweries. All stuff that would naturally spill over from one of the hottest neighborhoods in the South.

Of course the neighborhood will change. Hendrickson imagines that over the next 30 years, South End will be covered in towers that rival those in Uptown.

At that point, he figures the next generation of landowners will build one of those skyscrapers here. But, he says, if they include the affordable housing component this time, low-income units will likely figure into any future developments.

When I suggested to him that it seemed like a lot of work just to turn the property over in 2049, the 63-year-old said, “But we can get a lot of living done in 30 years.”

He and McKinnon have been in contact throughout to make sure their missions for those 30 years align.

“There’s no perfect solution, but for me it’s how can we get the best,” McKinnon says. “At the end of the day, nobody at that table (negotiating) was going to be impacted. … It’s on leaders of all stripes, if you’re in those rooms, to center the many and not the few. Center the most vulnerable.”

Just before the end of 2019, all the parties made their moves: the lease owners sold their investment to the South Tryon Community Development Corporation run by McKinnon at a bargain price, which in turn sold it to Hendrickson’s group for nearly $800,000.

“The issues that have clouded Brookhill Village for years are gone,” Hendrickson said the day the Charlotte Business Journal broke the story of the lease transfer.

Hendrickson was at least one step ahead of himself. The question remains: Will his group receive the $15 million necessary to close the gap?

Proposals are due to the city by February 10; recipients will likely find out this spring. Hendrickson knows the project will be alongside others that ask for much less, but he believes the Brookhill project is too important to pass up.

“At this point it’s just money,” he told me. “I know what it sounds like to say that. But with everything about this project, it’s amazing that we got it down to just that.”

Locket is nervous.

She’s worried that what sounds good now and what plays out later will be different things. She’s worried her rent will double. She’s worried the new lease holders will look at her salary of just over $30,000 and say she’s wealthy.

For someone who’s worked at the same hospital for 33 years and has lived in the same community for 27, consistency is important.

“I’m afraid I’m going to be paying $900,” Locket says. “They say in society that $1,000 or less is low-income. But that’s not low-income to me.”

For his part, Hendrickson says he’s continuing to learn about the property and its history. He spent three days in town last week meeting with different organizations. Before heading back to his home in Zebulon, he had lunch with Jacobs, the photographer who created the “Welcome to Brookhill” exhibit at the Gantt.

They toured the exhibit after eating, and Jacobs told him the stories behind some of the faces.

“I had an instinctive passion,” Hendrickson said afterward. “Now I have an informed passion.”

That’s welcome news for someone like Locket who has spent nearly all of her adult life in Brookhill. On winter nights, the residents check on each other. On Saturdays in spring and summer, they have cookouts to celebrate graduations.

If you ever take the time to pull over, Locket says, you’ll meet a loving community with a bond unlike any other. And in the fastest-growing city in the southeast, a city where multimillion-dollar deals come down to “just money,” Locket says connections like that are worth upholding.

“I’m gonna be here right ’til the end,” she says, “and I’m praying and hoping that Brookhill shows them all that they say what they mean.”

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