SAN FRANCISCO-The next generation of leaders in affordable housing and community development will bring a different perspective and embodiment of the issues and drivers than their Boomer predecessors. But have we developed the knowledge, the business models and techniques, and perspective for the next generation of leaders to manage production, new investment and portfolio in this much more complex rubric? Housing in and of itself was a far easier goal; building successful neighborhoods and communities of opportunity is a far greater challenge.

There are multiple tectonic shifts taking place in the affordable housing and community development business. The most obvious is the shrinking resources of government and the many ripples of the Great Recession (inequality, jobs, shrinking government, housing overhang). As recruiters in the business, we not only see these shifts reflected in the people side of the business, but we also see another far-reaching change with overlapping and additional impact: Our long term leaders, indeed the founders of many of our organizations, are aging baby boomers. The passing of the baton from the baby boomers to the next generation combined with the secular shifts over the coming years will be have significant, lasting impact.

As recruiters, our conversations revolve around leadership, careers, sustainability and resilience of organizations, culture, excellence, passion, and other elements of the human side of the business. What are the big trends and what are their impact on human capital and organizational platforms in affordable housing and CD business? We see three major, interrelated trends:

First, over the coming years, the baby boom generation of leaders will be retiring. Many of these folks were the creators of their organizations, while others are the successors who have helped take their organizations to new heights. In either case, many leaders have been long seated and have become synonymous with their organizations. Most came from the activism of the 1960′s and it drove their perspective and methods.

The tenure of leaders in affordable housing and community development groups, as well as in CDFIs, tend to be far longer than in the for-profit corporate world. NeighborWorks shared statistics with us on the tenure of the 234 Executive Directors in its network. The average tenure is 13.8 years, with 66% of the ED’s having over 10 years in the chair. And 31%, or 73 people, have been in the position for over 20 years! This contrasts to an average of 8.4 years in corporate America and only 6.2 years among the top REITs. With NeighborWorks members as a proxy for the sector, we clearly have an aging group of leaders with the inevitability of change coming a meaningful cohort within the industry.

NeighborWorks America COO, Chuck Wehrwein observes this level of change but feels that the industry is prepared. He says “there is an inevitability of change. But with leadership training through venues such as the NeighborWorks Training Institute, the Achieving Excellence program at Harvard, and a willingness to seek leaders from nontraditional sectors, we are building up the bench strength for the sector and expanding the base from which Boards can chose leaders.”

Of course, the leadership baton has already been passed in many organizations. Succession has already occurred at organizations like Enterprise, Community Builders, REACH, and BRIDGE Housing, to name a few. At Jamboree Housing Corp., youth and hard work are hallmarks of the company’s development team as the under-40 project managers oversee the construction of some of the affordable housing industry’s most progressive development projects. “We are very proud of our development team’s exceptional work on some extremely complex and challenging properties,” said Laura Archuleta, Jamboree president. “Although they are younger, they bring to each project a high level of experience, expertise and professionalism that translate into successful development that is on-time and on-budget.  Based on the quality of their work here,  I am confident they are preparing daily to become members of the industry’s future leadership corps.”  There is a much larger number to come. Many organizations have talented number-twos ready to step up, but many will need to bring in new talent. Much of the talent coming in will be post-Boomers.

Second, the business is increasingly about performance and measurable outcomes, rather than ideology and community organizing as an end in itself. Making a measurable difference is what it is all about. We have built organizations that increasingly aspire to world class operating platforms and technologies. We use the word “aspire” for two reasons. It is a never-ending quest. More importantly, organizations in the community development field are generally still behind the for profit sector on the sophistication of their operating platforms — the strength of the back office, the use of technology, the organizational infrastructure is still climbing up the curve. The emphasis on measurable results and sophistication of platform are result of both the maturation of our industry and a response to shrinking financial resources, the second generational shift, then, is all about creating more sophisticated, impactful and resilient organizations and our clients will be seeking the leadership talent to accomplish this.

Finally, with the generational shift from the Boomers, we also see a change of mindset and values. The Boomer leaders came into the business with a 60′s and 70′s mentality about neighborhoods, poverty, and their place in the world and building housing (not neighborhoods) was a primary goal. The issues have changed and will continue to do so. Our definitions of poverty and getting out of poverty have changed as inequality has worsened in our country. Sustainability now matters in all instances and many cities have become vibrant centers instead of dead zones (bringing back the issues of gentrification). And our country has become hugely diverse. Housing is increasingly viewed as a key component of an overall community strategy, rather than a solution in itself. Community development and affordable housing, now more than ever, is about creating general opportunity for residents of underserved communities and, as the CEO of the Community Builders observes, “it is a time of incredible opportunity for talented individuals who have the perseverance and creativity to make real change in building and sustaining strong communities”.

Terri Ludwig, CEO of Enterprise Community Partners and one of the new generation of leaders, observes “as a new generation of leaders take the reins, it is important to continue the legacy of those who came before us, those who laid the groundwork for the industry. For us, that means continuing the vision of Jim Rouse, who believed that business, government, and the nonprofit sector can work together to solve our most pressing problems. At the same time, we must continue to evolve, to innovate and to take risks – to learn from the past while developing new approaches.”

So, where does this take us? These sectors share a common heritage and are attacking common problems. The retirement of the Boomers in the industry is coming and will have deep effect. As per Nancy Andrews, CEO of the Low Income Investment Fund, “the community development field in the US is unique in the world for its scale, professionalism, and capacity to deliver in every major city and State. We are built to last and thus, are an attractive prospect for the next generation of leadership talent.” Well said. We are in the midst of a generational change at the top in this industry. At the end, we see a stronger sector, more able to address the interrelated problems of poverty, and to better utilize the scarce resources of the coming years.