Boston can be an unwelcoming place to do business. Here’s how to change that
It’s hard to top last week’s $200 million groundbreaking of the new General Electric headquarters in the Seaport District. But an event Monday to celebrate a new Omni Hotel on Massport land a few blocks away comes close.
Not because of the size of the project — 1,000-plus rooms that will cost $550 million to build — or how it will go a long way to easing Boston’s chronic hotel room shortage.
The significance of the Omni is the diversity requirement established by the Massachusetts Port Authority that creates a new standard for including minorities and women in major projects that too often go to the same people in town.
Instead of simply mandating a percentage of diversity hires for design and construction, Massport emphasized minority and female ownership among bidders and the participation of minority and women-owned firms as their partners. Diversity counted for 25 percent of the evaluation score alongside critical elements such as design, development, and finance.
The result: Instead of minorities and women playing bit roles, they have responsibilities that will allow them to build their companies and pave the way to other major projects.
How so? Minority and women-owned companies have found themselves shut out of the bulk of the development boom, but the Massport requirement will now give more of them big project experience.
“It changes the culture of the way people are going to do business,” said Greg Janey, chief executive of Janey Construction Management & Consulting in Boston.
The genius of the Massport requirement is that it forced companies to form relationships outside their usual networks, and in doing so, the agency got one of the most diverse teams for a major construction project in Boston.
Janey, who is black, has been in business for three decades but never met John Moriarty, the owner of one of the biggest construction companies in town. The two set up a partnership just for the Massport bid.
Janey and Moriarty were introduced as Boston developer Jonathan Davis began assembling his team three years ago. The Massport hotel wasn’t on Davis’s radar screen until he got a call from Rich Taylor, who runs his own real estate firm.
Taylor, who is also African-American, and the late architect Howard Elkus wanted to put Massport’s novel diversity requirement to the test. They sought out Davis, a veteran owner and manager of commercial real estate properties who also is civic-minded. Davis has been a longtime board member of the Boys & Girls Club of Boston, including a stint as chairman.
“We weren’t just looking for money and experience,” said Taylor, who served as transportation secretary under Governor Bill Weld. “We were looking for people who understood and wanted things to change in the city.”
Davis got it. He knew Moriarty; Taylor knew Janey. Together, they assembled a diverse construction management team. Davis then brought in Robin Brown, the former general manager of the Boston Four Seasons turned hotel builder. Davis rounded out his development team with another firm led by two women — Pam McDermott and Beverley Johnson.
While Brown was brought in for his hospitality expertise, he proved instrumental in helping to recruit minority investors to become equity partners. When Brown opened the Four Seasons here, he went out of his way to make sure that the Bristol Lounge was an inclusive place, in particular for African-American movers and shakers. Many of them ended up being part of the deal, including Linda Whitlock, the former chief executive of the Boys & Girls Club, and the Rev. Charles Stith, the former US ambassador to Tanzania. In all, more than 20 people of color — Asian, Hispanic, and black — became investors. While they collectively make up a small percentage of the equity team, they will share in the profits like the general partners.
On the design front, Elkus’s architectural firm, Elkus Manfredi, formed partnerships with two black-owned architectural firms: Stull and Lee Inc. of Boston and Moody Nolan of Columbus, Ohio. Also brought in were landscape architecture firm Mikyoung Kim Design, which is owned by an Asian-American woman in Boston, and Nitsch Engineering, founded by Judith Nitsch. All told, nearly one-third of the design phase will be done by companies owned by women or minorities.
The diversity requirement was the brainchild of Massport member Duane Jackson, an African-American real estate developer. He knew firsthand how unwelcoming the Boston business community could be and wanted to change that. He brought the idea to Massport chief executive Thomas Glynn.
Glynn liked it and so did James Rooney, who at the time headed the Massachusetts Convention Center Authority; the Massport project was originally slated to be a new convention center headquarters hotel but later was changed to a regular hotel after the convention center expansion was put on hold. Rooney had planned to apply a similar diversity requirement to the convention center expansion.
Glynn said his agency, which also runs Logan Airport and the port, has already inserted versions of the new diversity requirement into proposals for the airport concessions contract and the development of a marine terminal.
“The goal is to do it consistently going forward,” said Glynn. “We are trying to say this is the new Boston.”
Governor Charlie Baker, Boston Mayor Martin J. Walsh, and other politicians hailed the initiative at Monday’s event held on the site where the new Omni will open in 2021, on the corner of Summer and D streets across from the Boston Convention & Exhibition Center.
I hope Baker and Walsh will insert the new diversity language into other public projects. Think of all the parcels that the state Transportation Department would like to bid out for redevelopment, such as its Chinatown site. Certainly the city sits on a trove of similar parcels as well. For that matter, the private sector could on its own set the bar as high as Massport has on diversity.
Massport may be setting the pace, but for our business environment to truly change, the agency can’t be the only one walking the walk on diversity.