Business
    Next Score View the next score

    Shirley Leung

    Diversity mandate lifts city’s profile

    The Boston Convention & Exhibition Center. For now, expansion plans are up in the air.
    David L Ryan/Globe Staff/file 2014
    The Boston Convention & Exhibition Center. For now, expansion plans are up in the air.

    The fate of the South Boston convention center expansion and its new hotel may be up in the air, but one thing should not be: the project’s diversity policy.

    In fact, even without a shovel in the ground, a bold requirement on how to increase the participation of minorities and women in development and construction is turning heads both locally and nationally.

    The game-changing difference: making diversity a major factor in awarding the $800 million hotel contract, not just a check-the-box component.

    Advertisement

    “I’ll be brutally blunt about when and where we pursue opportunities. We had not seen a healthy climate for minority businesses in Boston as far as for architects,” said Curtis Moody, chief executive of Moody Nolan, an architecture firm in Columbus, Ohio.

    Get Talking Points in your inbox:
    An afternoon recap of the day’s most important business news, delivered weekdays.
    Thank you for signing up! Sign up for more newsletters here

    “When we see there is an effort like the convention center and the hotel, that is encouraging,” said Moody, who is black and whose firm is part of a bid led by local developers Jon Davis and Dean Stratouly and hotel consultant Robin Brown, who are white.

    Moody’s firm has nearly 200 architects and eight offices around the country but has yet to do a project in Boston. If his team wins, Moody plans to open an office here. And even if his team loses, Moody is starting to have a different attitude about the city.

    “We are taking a hard look at Boston,” he said.

    For years, public projects have had diversity goals. For example, major capital projects funded by the state recommend that minority and female-owned businesses make up 10.4 percent of the construction contract and 17.9 percent of design services. The formula is based on a study of disparities, including in wages and finances, between companies owned by minorities, women, and white males in the construction industry.

    Advertisement

    But even with these guidelines, the region’s development and construction sectors remain dominated by white men — and often the same ones. Our idea of inclusion is that we now have Irish and Italian developers.

    Along comes the Massachusetts Port Authority and the Massachusetts Convention Center Authority, which together will pick the winning bid to build a second convention center hotel. Massport owns the land on the South Boston Waterfront, where the hotel would be located.

    Massport and the convention authority officials created a system that ranks bidders and makes diversity account for 25 percent of the score, compared with the typical 5 percent to 10 percent for public projects.

    The agencies also asked bidders to include minorities and women in the development, financing, and ownership of the project — not just in construction and design.

    “We delivered a very firm message,” said Jim Rooney, who helped craft the diversity requirement when he ran the convention center authority.

    Advertisement

    “There’s a new aspiration in town,” added Rooney, who now heads up the Greater Boston Chamber of Commerce. “It’s not just meeting the numbers. That’s the floor now.”

    Three teams turned in bids in February. Since then, Governor Charlie Baker has put the convention center expansion on hold, and Massport and convention center authority officials are reevaluating whether a 1,200-room hotel is needed.

    But the novel approach to stepping up our game on diversity is already forcing people to think differently.

    The Davis team, in addition to recruiting minority-owned firms like Moody Nolan and Boston-based Janey Construction Management, rounded up nearly two dozen minority investors who collectively contributed about $7 million to the project. They represent a “who’s who” of the people of color in town, including former US Senator Mo Cowan and the power couple Flash and Bennie Wiley.

    Another team consists of local developers Dick Galvin and Kirk Sykes, who ended up forming a company called Accordia Partners that is actively bidding on projects throughout the city. Galvin is white, Sykes is black, and they have known each other for a decade, but it took the convention center hotel to make them business partners.

    “Dick wanted to do more than win another big deal,” said Sykes. “Dick didn’t have a problem with me owning a majority share. We’re not here for this one deal. We’re here for a lot of deals.”

    Already, Accordia, which was formed last year, has gone after five projects, including the high-profile redevelopment of the city-owned Winthrop garage near Downtown Crossing.

    The final team is being led by black entrepreneur Norman Jenkins, the founder of Capstone, a hotel-focused development and acquisition company in Washington. He teamed up with Boston developer Joe Fallon, who is white and has worked with a partner of Jenkins.

    Jenkins was a longtime Marriott International executive before going out on his own in 2008. He applauds the new diversity measurement and hopes other cities adopt a similar policy. The goal, in his mind, should be to create new minority-owned businesses.

    “If it’s successful, you have development companies and firms that come out of these mandated structures, and not get a few guys rich,” he said. “You want it to result in three or four Capstones.”

    For all of you wondering how Massport and the convention center authority came up with such a progressive policy, thank Massport board member Duane Jackson, himself a black developer who felt Boston hasn’t been as welcoming to minority-owned businesses.

    Jackson started pushing the idea at the authority and quickly got support from Massport chief Tom Glynn.

    It was also an easy sell to the convention center authority, run by Rooney, who has championed diversity and whose board chair at the time was Michelle Shell, a black woman.

    In creating the policy, Jackson was thinking about his youngest son, who is in the real estate business, but in New York.

    “I’d love to see him come back,” Jackson said. “He doesn’t think there is an opportunity in Boston.”

    MORE COVERAGE:

    Seaport hotel could see tax relief, but critics are wary

    Boston Convention Center sticks to expansion plans

    Editorial: Charlie Baker’s pause on convention center expansion was appropriate

    Convention business at risk in wake of shelved expansion

    Shirley Leung is a Globe columnist. She can be reached at shirley.leung@globe.com. Follow her on Twitter @leung.