Virginia Union Received $40M Investment, Its Largest Gift Ever In 159-Year History

Virginia Union is the first recipient of a partnership between impact investment firm The Steinbridge Group, led by Tawan Davis, and the Student Freedom Initiative, a not-for-profit founded by Black billionaire Robert F. Smith.

Virginia Union University has received a roughly $40 million capital investment from The Steinbridge Group, marking the largest gift in the historically Black university’s 159-year history. The money will be used to develop 100 acres of the university’s underutilized land for attainable commercial and residential uses.

Virginia Union is the first partner recipient to be announced from a collaboration between impact investment firm The Steinbridge Group, led by CEO and founder Tawan Davis, and the Student Freedom Initiative (SFI), a not-for-profit founded by Black billionaire Robert F. Smith, chairman and CEO of Vista Equity Partners. Steinbridge provided $100 million in capital investment. At the same time, SFI was announced last week as the collaborating organization to help source the recipient of historically Black colleges and universities (HBCUs) and other minority-serving institutions (MSIs). The effort will expand investments into developing impact-focused real estate around these institutions, creating affordable housing options for working families, including professors and area professionals.

“Virginia Union is going places we have never been before because students and the community have high expectations of this institution,” Dr. Hakim J. Lucas, president and CEO of Virginia Union, said in a statement. “The Steinbridge investment will enable Virginia Union to create new sources of income, which will further strengthen our ability to create opportunities for students and the community.”

SFI President and CEO Dr. Mark Brown noted Richmond’s 44% Black population. Yet, due to increasing property values and tax assessments, “these community members face growing barriers, and many have been forced to sell their homes in areas they have long lived and worked. As the city faces a 35,000-unit housing shortage, this partnership will help many in the community find stability and will help to grow economic potential for the entire region,” Dr. Brown said.

Davis said downtown Richmond has simultaneously seen a growth spurt driven by people moving into the region and moving close to nearby Virgnia Commonwealth University. However, many HBCUs don’t have the full capacity to catalyze available land into “economically-productive uses for the university,” so his firm is partnering to achieve this.

“America is chronically underhoused and HBCU institutions are chronically underfunded,” Davis, 44, told BLACK ENTERPRISE. “So, our view is that instead of it being just a ‘problem,’ it actually creates an opportunity for us to put together private capital to address it and create a return that is impactful financially—both for the university and for private investors—and invite those investors to continue to expand their private capital commitment to the institutions as they will.”

In announcing the initial details of the partnership, Steinbridge says it will include a development on Richmond’s North Side, designed by Richmond-based KEi Architects, to include 130 to 200 residential homes on university-owned parcels. Martin Architectural Group will provide design support. As part of the initiative, Steinbridge and Virginia Union will collaborate to help graduates become homeowners, building wealth in communities at risk of displacement due to the impacts of gentrification in transitioning neighborhoods.

“As the oldest African-American-owned, continuously run nonprofit, and as an anchor institution for Northside Richmond,” Dr. Lucas said of Virginia Union, which now has record-breaking enrollment, surpassing 2,000 students. “We have a historic responsibility to drive the economic community development of this side of town.”

Impact real-estate benefits to university “are massive,” Davis says, noting Virginia Union will be able to quadruple or quintuple the value of the land throughout the investment versus selling the land outright. Davis said the investment will also increase this HBCU’s endowment, anywhere from 13% to 18%.