Sadly, these buildings just aren’t good investments, and he’s not a good investor. Buildings that old are subject to all kinds of safety regulations, and Birmingham is not an easy town to work through that kind of thing. No one in the city is going to stick their neck out to cut through decades of regulations only to lose their job when there’s a fire or collapse. Any new owner will be tied up in red tape and rehab requirements that would dwarf the value of the buildings themselves. It’s likely that feasibility studies, inspections (and reinspections), and permits alone would cost more than the buildings. They also tend to take months and even years to get through.

I’m a successful real estate investor and while I absolutely love old downtown areas like that, and would love to revitalize them myself, I couldn’t even talk my wife into one of those properties, much less eight for which I had no budget. The numbers just don’t pencil out.

Racism has nothing to do with it. In fact, banks love to make loans to women and minority business owners. But there are some risks that would be irresponsible, and this is a textbook example of a loan that’s likely to default, leaving the banks with costs they couldn’t possibly recover.

Just to make sure this post gets flagged to extinction, I’d like to suggest to anyone sure that this is a case of racism and not pragmatism put together an investment group and help out.