ndc annual report 2007

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NEIGHBORHOOD DEVELOPMENT CENTER A N N U A L R E P O R T 2 0 0 7 Empowered Entrepreneurs. Inspired Neighborhoods.

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NDC Annual Report 2007

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NEIGHBORHOOD DEVELOPMENTCENTER

A N N U A L R E P O R T 2 0 0 7

Empowered Entrepreneurs. Inspired Neighborhoods.

O U R M I S S I O NThe Neighborhood Development Center (NDC) is a community-based non-profit organization that works in the low-income communities of St. Paul, Minneapolis, surrounding suburbs and Greater Minnesota to help emerging entrepreneurs develop successful businesses that serve their community, and to help community groups build a stronger neighborhood economy.

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TRANSFORMING NEIGHBORHOODS THROUGH OPPORTUNITY.Because of our unique collaboration with Neighborhood Partners (existing community organizations

within the neighborhoods and among the people served by NDC), we are able to provide entrepreneurs

with the opportunity to receive the business training, financial assistance and on-going support crucial

to the success of their businesses.

That success translates into the creation of jobs and the generation of revenue for low-income communities.

Such social and economic impacts serve as a catalyst for turning disinvested and deteriorated neighborhoods

into ones that are devoted and determined, like the ones highlighted in this Annual Report.

We give our sincerest thanks and are truly grateful for the tireless commitment and steadfast support of

our exuberant board of directors; talented staff, trainers and consultants; generous funders; and trusted

Neighborhood Partners. We also thank every entrepreneur whom we have had the honor to serve. We thank you

all for helping us help small businesses succeed and neighborhoods to thrive.

Mihailo Temali,NDC Executive Director

Kate Barr,NDC Board President

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Tony Genia,Former NDC Board President

O U R V I S I O NThe philosophy is simple: Work with Neighborhood Partners to offer NDC services to entrepreneurs through a

process controlled by each individual community. There is no cookie-cutter approach to the services NDC provides.

Each entrepreneur, every business and all neighborhoods have a different set of challenges.

The reward is priceless: Foster leadership and inspiration from within each neighborhood to generate maximum

impact on community development. NDC believes every community has a wealth of business talent and ideas,

which if given the opportunity to be fully developed provide jobs and income that galvanize community leaders and

strengthen the local economy.

The approach is dynamic: Develop and implement innovative programs that empower entrepreneurs to start

and/or grow businesses within their community. Building upon the network, knowledge and trust already

established by Neighborhood Partners, NDC is able to connect with inner-city business owners and organizations

to provide on-going services and resources in five program areas: Training, Financing, Business Support,

Incubation and Capacity Building.

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Photo by Bob Prezel of Perzel Photography Group

Micro-Entrepreneur TrainingIn addition to English-speak-

ing individuals, NDC provides

specialized training to Hmong,

Latino, Somali and East African

entrepreneurs in their native

languages. This 16-week

course covers the fundamentals

and techniques of marketing,

operations, financial

management and writing

a solid business plan.283 entrepreneurs trained

Small Business FinancingNDC’s unique funding resource

fills a gap in the Twin Cities

finance market by providing

access to credit for start-up

businesses (and other

entrepreneurs) who are unable

to access traditional sources

of capital. NDC created the

nation’s first Reba-Free

financing program to meet the

needs of the large Somali

immigrant community.39 loans totaling $611,455

On-going Business SupportTheir are two satellite business

resource centers available to

entrepreneurs. NDC provides

on-going support in market-

ing, merchandising, financial

record-keeping, credit repair,

retail management, legal as-

sistance and more. 2,945 hours (229 alumni)

Incubation/Space DevelopmentNDC and neighborhood

organizations collaborate to

reclaim and rehab commercial

properties within targeted inner

city neighborhoods. The

properties then operate as

Incubators, providing a network

of support and resources

for small businesses.

Frogtown Entrepreneur Center

Mercado Central

Midtown Global Market

Plaza Latina

Plaza Verde

Swedish Bank Building

CapacityBuildingNDC works with Neighborhood

Partners to enhance their

capacity to create and

conduct economic development

initiatives within their own

communities.

25 neighborhood partners

P R O G R A M A R E A S

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These neighborhoods, rich in diversity, have for many years struggled with poverty, vacant homes and empty

commercial buildings. The once vibrant Sears building, located at Chicago Avenue and Lake Street, stood

abandoned for 15 years before it was reclaimed.

NDC along with three Neighborhood Partners: the African Development Center, the Latino Economic Development

Center and the Powderhorn Phillips Cultural Wellness Center, purchased and redeveloped the property. Although

the four groups equally own and govern what is now known as the Midtown Global Market, NDC was the lead

developer on the project and has managed the site since it opened.

The Midtown Global Market opened in May of 2006. It is a mixed-used development with office space, a hotel,

housing and a variety of small businesses. Approximately 90 percent of those small business owners in operation

are NDC alumni.

CENTRAL, PHILLIPS & POWDERHORN

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N D C H I S T O R I C M E A S U R E S O F S U C C E S S *

Training 1,165

Alumni Businesses 167

Visible On Lake Street 112

Alumni of Color 138

Jobs Created 666

Dollars to Neighborhood $10,341,695*Estimates based on Wilder Research 2007 NDC Outcomes Evaluation. NDC internal estimates of alumni in business and subsequent impact are significantly higher due to broader definitions.

Photo by Bob Prezel of Perzel Photography Group

NEIGHBORHOODS

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N D C H I S T O R I C M E A S U R E S O F S U C C E S S *

Training 1,165

Alumni Businesses 167

Visible On Lake Street 112

Alumni of Color 138

Jobs Created 666

Dollars to Neighborhood $10,341,695*Estimates based on Wilder Research 2007 NDC Outcomes Evaluation. NDC internal estimates of alumni in business and subsequent impact are significantly higher due to broader definitions.

In 2005, Fields got the idea to turn her hobby of making gift baskets for friends

and relatives into a viable business. She quickly realized that in order to do that

she needed a business plan, so she signed up for the NDC Micro-entrepreneur

training classes.

Nearly one year, three employees and one volunteer later Fields is living her

dream. As owner of Specialty Gifts and More, located inside the Midtown Global

Market, Fields offers an array of unique gift ideas, plants and cut flowers that

can be purchased individually or arranged together into thoughtful gift baskets.

“NDC is truly a community-connected

organization, and they gave me the

encouragement, resources and

support to do something that benefits

the community.” —Lois Fields

LOIS FIELDS, SPECIALTY GIFTS AND MORE

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Although it has been compromised by crime, shabby storefronts and an overall poor image, West Broadway is

the most significant commercial and cultural corridor in North Minneapolis. For more than 10 years, NDC has

partnered with the Northside Residents Redevelopment Council (NRRC) to offer micro-entrepreneur

training classes in this community.

That partnership was instrumental in the creation of the Neighborhood Economic Opportunity Network

(NEON), a collaboration of approximately eight Neighborhood Partners, which focuses more specifically

on business development and growth for West Broadway.

In 2007, NEON hosted seven micro-entrepreneur training classes for 70 individuals. By 2010 NEON, in part-

nership with NDC, expects to train more than 200 entrepreneurs and spur the creation of 60 new businesses.

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N D C H I S T O R I C M E A S U R E S O F S U C C E S S *

Training 456

Alumni Businesses 52

Visible On West Broadway 8

Alumni of Color 47

Jobs Created 207

Dollars to Neighborhood $3,208,036*Estimates based on Wilder Research 2007 NDC Outcomes Evaluation. NDC internal estimates of alumni in business and subsequent impact are significantly higher due to broader definitions.

NEIGHBORHOODSHAWTHORNE, JORDAN& NEAR NORTH

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GROVER JONES, NEON

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The goal of NEON is to provide micro-entrepreneur training and technical

assistance to existing businesses and aspiring entrepreneurs. The long-sited

purpose is that these entrepreneurs will eventually populate West

Broadway, becoming a key partner in the capacity building efforts to

revitalize this troubled corridor.

According to Grover Jones, Executive Director of NEON, the biggest challenge

is economic. Entrepreneurs are finding it increasingly difficult to get loans

underwritten through traditional sources because of poor credit, no capital and

no collateral. That is why organizations like NDC are pivotal; because of the

ability to develop creative ways to finance new business owners.

“As one of the most under-served

communities, the capital has not been

available...getting more money

[businesses] on the street will

ultimately revitalize North Minneapolis.”

—Grover Jones

DaytonsThis area thrived until about twenty years ago when there was a major disinvestment due to aging homes,

crime and factory closings. Its saving grace has been its people; both new and long-term residents.

The Swedish Bank Building, located on Payne Avenue, was renovated by NDC and is co-owned with the East Side

Neighborhood Development Company (ESNDC), a non-profit organization with a mission to create wealth and

well-being in a thriving and engaged multi-cultural neighborhood.

Although the Eastside Financial Center was created to meet the financial needs of all East Side residents, special

attention is given to under-served individuals. The third floor operates as a business development center managed

by NDC and the Cultural Wellness Center.

PAYNE-PHALEN & DAYTON’S BLUFF NEIGHBORHOODS

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N D C H I S T O R I C M E A S U R E S O F S U C C E S S *

Training 617

Alumni Businesses 63

Visible On Payne Avenue 13

Alumni of Color 47

Jobs Created 250

Dollars to Neighborhood $3,883,412*Estimates based on Wilder Research 2007 NDC Outcomes Evaluation. NDC internal estimates of alumni in business and subsequent impact are significantly higher due to broader definitions.

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“NDC helped me know exactly what I

need to know to run a business...how

to do taxes, payroll and how to write a

good business plan.” —Jose Payan

JOSE PAYAN LAPERLA TORTILLERIANEIGHBORHOODS

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N D C H I S T O R I C M E A S U R E S O F S U C C E S S *

Training 617

Alumni Businesses 63

Visible On Payne Avenue 13

Alumni of Color 47

Jobs Created 250

Dollars to Neighborhood $3,883,412*Estimates based on Wilder Research 2007 NDC Outcomes Evaluation. NDC internal estimates of alumni in business and subsequent impact are significantly higher due to broader definitions.

Jose Payan started his tortilla factory almost 9 years ago as a family

operated business. Today LaPerla Tortilleria has 52 employees and three

locations: Payne Avenue, Mercado Central and South Minneapolis. The bulk

of his business is packaging and selling tortillas to local restaurants and

grocery stores; however each location is also open to the public.

LaPerla’s product line includes corn and flour tortillas in a variety of sizes all

made fresh, start to finish, on site. This includes cooking and grinding its

own corn, mixing ingredients, frying tostadas and tortilla chips, and

producing and packaging the product for shipment.

FrogtownKnown historically as Frogtown and officially as Thomas Dale, this neighborhood is home to a large refugee and im-

migrant population; Southeast Asian, East African and Latino. University Avenue, the primary commercial corridor,

has weathered a storied past of prostitution, pornography, drugs and crime.

But, by the early 1990s, residents community organizations and local businesses had begun to reclaim this diverse,

working middle class neighborhood. Part of the on-going revitalization will include the Frogtown Crossing, a collabora-

tive effort among multiple development partners, which will occupy the northeast corner of University and Dale.

Frogtown Crossing will include a mix of housing, retail, food and entertainment. NDC has taken the lead in

developing the approximately 12,000 square feet of street-level, commercial space earmarked for

businesses that serve the needs of this growing neighborhood.

NEIGHBORHOODSFROGTOWNSUMMIT-UNIVERSITY

N D C H I S T O R I C M E A S U R E S O F S U C C E S S *

Training 679

Alumni Businesses 77

Visible On University Avenue 29

Alumni of Color 59

Jobs Created 307

Dollars to Neighborhood $4,769,843*Estimates based on Wilder Research 2007 NDC Outcomes Evaluation. NDC internal estimates of alumni in business and subsequent impact are significantly higher due to broader definitions.

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“We’ve seen a lot of changes since

we’ve been here, and we are happy

to see more businesses returning to

Univerisity Avenue.” —Shoua Thao

SHOUA THAO, SHOUA’S CLOTHING SHOP

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Shoua Thao and her husband Jouye Moua came to Minnesota from

Thailand by way of Appleton, Wisconsin in 1986 and have operated Shoua’s

Clothing Shop on University since 1995. They specialize in custom women’s

clothing (dresses for weddings, proms and other special occasions) and men’s

tailored suits.

Thao designs each dress herself, and then sends that unique design

to Thailand for mass production. The garment is then shipped back to

the store and alterations are offered in-house. Although the store is

open to the general public, the largest client base is Hmong men and

women and African-American women.

Financial SupportBALANCE SHEET

FINANCIALSUPPORT

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Assets Cash and Cash Equivalents Restricted Cash

Total Cash and Cash Equivalents Cash - Replacement Reserve Contribution Receivable Other Receivables Loan Receivable Prepaid Expenses Rental Properties, Net Property and Equipment, Net Financing, Fees, Net Investment in Other Companies Notes Receivable - BLNMIF, LLC Other Assets Total Assets

Included: Neighborhood Development Center; Frogtown Entrepreneur Center; NDC REDI I, LLC; NDC REDI II, LLC; Mercado Vista, LLC; and MGM Community Partners, LLCNumbers are rounded to nearest dollar.Sources: Unaudited Financial Statements

Liabilities and Net Assets Liabilities:Accounts Payable Accrued Expenses Tenant Security Deposit Undisbursed Loan Funds Loans Payable

Total Liabilities Non-Controlling Interest Net Assets: Board Designated Other Unrestricted Temporary Restricted

Total Net Assets Total Liabilities and Net Assets

351,732 849,902

1,201,634

6,900 870,000

1,702,391 1,673,783

61,040 6,136,132

13,893,921 354,383

2,500 1,861,398

238

27,764,317

270,889 1,015,704

26,904 186,363

16,486,445

17,986,306

874,075

6,292,260 963,498

1,648,178

8,903,936

27,764,317

Neighborhood PartnersCorporate and FoundationAllianz LifeAllstate FoundationAmeriprise FinancialBremer FoundationFord Foundation*Fredrikson & Byron, P.A.General Mills FoundationGeorge Family Foundation*Grotto Foundation*Heron FoundationKnight FoundationMann Foundation,* Ted and RobertaMcKnight Foundation*McNeely FoundationMinneapolis FoundationNorthway Community TrustO’Shaughnessy FoundationPayne Lake Community Partners*Perlman Foundation,* Lawrence and Linda Pohlad/United Properties*Ryan Companies*Securian FoundationSt. Paul/Bigelow FoundationsSt. Paul Travelers*

Aurora/St. Anthony Neighborhood Development CorporationAfrican Development CenterAmerican Indian Economic Development FundChicanos Latinos Unidos En ServicioDayton’s Bluff Community CouncilEast Side Neighborhood Development CompanyEmerge Community DevelopmentFriendship Community Services, Inc.Greater Frogtown Community Development CorporationHennepin County LibraryHmong American PartnershipHope Community, Inc.In the Heart of the Beast TheatreLatino Economic Development CenterMinneapolis Consortium of Community DevelopersModel Cities of St. PaulNeighborhood Economic Opportunity NetworkNorthside Residents Redevelopment CouncilOromo Community of MinnesotaPowderhorn/Phillips Cultural Wellness CenterRiverview Economic Development AssociationRondo Community Outreach LibrarySelby Area Community Development Corp.Seward Redesign, Inc.Sparc

StaffAyan Abdi, Training Program CoordinatorDaniel Birru, AccountantPatricia Brown, MGM Market DirectorCecil Camara, Senior AccountantJuliana Diamond, MGM Office ManagerElizabeth George, Mercado Market Manager

Staff (Con’t)Richard Hofacre, Facilities Maintenance ManagerHarvey Hoffman, Building Operations ManagerMike LaFave, Real Estate Development DirectorEarlsworth Letang, Deputy ManagerAllison Maciejewski, Technology CoordinatorBonita Martin, Training Program DirectorMaria (Tony) Mata, BCC Program DirectorPerla Mayo, Loan OfficerKathy Moriarty, Chief Administration OfficerMara O’Neill, Chief Operating OfficerMursal Osman, Technology CoordinatorSamir Saikali, Financial/Grants OfficerAngelita Scott, MGM Marketing CoordinatorBrian Singer, Loan Department DirectorEmma Spillman, Office ManagerMihailo Temali, Executive DirectorSai Thao, Loan OfficerMichael Thielen, Loan Fund AdministratorRomaine Turner, Loan OfficerTeshite Wako, Chief Financial OfficerJohn Wheeler, Director of Real Estate Development

Trainers and ConsultantsShahir AhmedJeffrey AlexanderEduardo BarreraTheresa BaumannDave BonkoBarry BonoffYolanda CotterallHussein FarahTony GeniaDavid GoodmanLao Lu HangWendy HinesMichelle JansenGrover Jones

Trainers and Consultants (Con’t)Tara McCarthyLeo MontesPhillip PorterBob ReedEdgardo RodriquezLinda SappJoanne SimonsFrank SprandlRomaine TurnerTeshite WakoDale White

Board of Directors Kate Barr, PresidentNuro Bedhaso DedefoWafiq Fannoun, SecretaryJohn Flory, Vice PresidentTony Genia, Former PresidentDesiree HellerTom KingstonRamon LeonJuan LinaresLorrie LouderThomas McBurneyArvid PovilaitisWilliam SandsVivienne Williamson, Vice PresidentDer Yang

FINANCIALSUPPORT

NEIGHBORHOODPARTNERS

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Sysco Corporation*Twin Cities Metro Certified Development CorporationGreater Twin Cities United WayUrban America*US Bancorp FoundationWells Fargo Foundation*Western BankXcel Energy

GovernmentCity of Minneapolis*City of Saint PaulCommunity Development Financial InstitutionMinnesota Department of Employment & Economic DevelopmentMinneapolis Empowerment Zone*Minneapolis Public LibraryOffice of Refugee Resettlement

IndivudualsEd PadillaWilliam Sands*

*Support provided for Midtown Global Market

633 University Avenue West, Suite 200Saint Paul, MN 55104

Phone: 651-291-2480Fax: 651-291-2597www.ndc-mn.org