Brooks Newmark: How We Are Helping To Make Housing More Affordable
The Government should encourage the roll-out of the Housing First model and should address the growing need to build more affordable housing. This will help people onto the housing ladder and there also needs to be tighter regulations on landlords who provide incredibly poor housing especially for those who find themselves in “bed and breakfast” accommodation.
In many large cities in the US, there is a crisis caused by a shortage of affordable housing options. This has led to a host of social challenges. In this series called “How We Are Helping To Make Housing More Affordable” we are talking to successful business leaders, real estate leaders, and builders, who share the initiatives they are undertaking to create more affordable housing options in the US.
As a part of this series, we had the pleasure of interviewing Brooks Newmark.
Brooks Newmark is a businessman, angel investor, philanthropist, and social reform campaigner. He served as a Member of Parliament (MP) for over 10 years (2005–15) and served in the Coalition Government as Minister for Civil Society. Brooks is passionate about ending homelessness in Britain and when he was in government, he was pivotal in establishing the Housing First model.
Brooks is also a successful businessman who invests in a number of start-ups such as Addition Finance, Get it Rwanda, Native Finance, and Rezolve. In addition, he is currently studying for a DPhil at the University of Oxford’s Education Department focussing on Education Reform and is the Co-Founder of A Partner in Education (APIE), a charity which works with Rwandan teachers to give children access to schooling.
Thank you so much for doing this with us! Before we dig in, our readers would like to get to know you a bit more. Can you tell us a bit about your “backstory”? What led you to this particular career path?
Like many people, my career has evolved. It has had both its ups and downs, but often when things seem to go bad, new opportunities emerge. Only with the benefit of hindsight can you see more clearly why one door must close for another one to open. My career path has been three careers: first was in business, eventually as a Senior Partner at Apollo Global Management one of the largest Private Equity firms in the world; the second was in politics, as a Member of Parliament, and eventually as Minister for Civil Society in the Cameron Government; and third in academia and the voluntary sector, where I am completing my doctorate in education at Oxford and having an education charity in Rwanda called A Partner In Education which provides primary education for 300 children and teacher training for early years learning.
Can you share the most interesting story that happened to you since you began your career?
Probably the most interesting one is how I met President Bashar Assad of Syria. I had never been to the Middle East but when I got into politics, I developed an interest in Syria and Lebanon. Many of my colleagues in Parliament when taking an interest in the Middle East focused on Israel-Palestine, but I wanted to differentiate myself and decided to focus on it from a business angle, looking at Lebanon and Syria and their relationship with Israel. Soon after I entered Parliament, I had an opportunity to visit Lebanon after the 2006 war between Hezbollah and Israel. However, due to a bombing in Beirut, I had to go via Damascus and while I was there, I used the opportunity to meet some Syrian politicians
At the time Syria was part of what Condoleezza Rice the US Secretary of State referred to as the axis of evil (with North Korea and Iran). The Ambassador leapt at the opportunity to have a British politician visit Damascus and the Ambassador arranged for me to meet 12 senior politicians and Ministers. Although in my first visit I didn’t meet the President of Syria, Bashar Assad, I left with a positive impression of Syria and felt we needed to do more to engage with Syria.
When I returned to the UK, I wrote an article that turned Condoleezza Rice’s comment on its head and was titled “Syria Part of the Solution not part of the Problem.” Building on a quote from another Secretary of State Warren Christopher who said “Diplomacy Becomes a Little Lazy if all we do is Talk to our Friends.” I wrote about the importance of engaging with Syria notwithstanding its poor behaviour in the past in the region. Two weeks after my article came out, I got a call from the Syrian Ambassador who said the President had read my article and wanted to meet me. In early 2007 I went back to Damascus and ended up having a 3 hour one on one meeting with Assad who indicated he wanted to engage more with the West and felt I could help. This began a 5-year relationship in which I returned to Damascus 9 times and continued to talk with the President on a wide range of issues. My last meeting with him was 11 weeks into the Civil War when he asked to meet with me again and I discussed with him a 5-point plan to de-escalate the war. Unfortunately, this failed and the war went from bad to worse and I became a harsh critic of the regime in Parliament. The story of my relationship with Bashar is the subject of a book I am writing called ‘Tea with a Tyrant.’
Are you able to identify a “tipping point” in your career when you started to see success? Did you start doing anything different? Are there takeaways or lessons that others can learn from that?
A tipping point came when my family’s business went bust and I had to stop the business I was building up with my brother in corporate advisory. This took 18 months to sort the mess out and to then return to rebuilding my life. I had no money, no job, a mortgage, two children, and a third on the way, and little idea what I was going to do next. I then ran into a friend of mine who wanted to leave the business he was in and suggested we raise a small fund to focus on investing in and turning around distressed businesses (the area my brother and I were focussing on).
We were seeking to raise £10MM for this new fund. I had several names on a list of potential investors, including Apollo Management, a small start-up Private Equity firm in New York. They liked what I was proposing to do in the UK and said that as they had no UK or European presence, I should open an office for them instead of raising my own fund (they had already raised $400MM and were now raising $800MM). We decided to join Apollo as their partner in Europe and I eventually became a Senior Partner at the firm. Apollo is now one of the largest Private Equity and Asset management firms in the world with over $455 billion under management.
If my family’s business had never gone bust, I probably would still be working in a small office in Borough High Street in South London trying to make ends meet.
None of us are able to achieve success without some help along the way. Is there a particular person to whom you are grateful who helped get you to where you are? Can you share a story about that?
Many people have helped me along the way, especially when things often seemed hopeless. However, one person really stands out. Mr. Jennings the bank manager at my local branch at NatWest in Princes Risborough the town I grew up in Buckinghamshire. When my family’s business went under and my life seemed to implode, Mr. Jennings came to my rescue. I didn’t want to lose my house which had a £170,000 mortgage and needed time to get back on my feet and find a job. I met with Mr. Jennings at the local branch office and explained my situation. He said he’d known me since I was 11 years old and opened my bank account with him, he knew I was a “clever lad” and would somehow get my life get back together again. On the spot, he gave me a loan of £10,000 and told me to keep him updated with my progress. I struggled to get work and subsequently told him I needed another £2,000 and then another £2,000. He supported me all along the way. He was like Jimmy Stewart in “It’s a Wonderful Life” one of my favourite films. In the end, I did get a job as a partner at a start-up Private Equity firm — Apollo as I mentioned above. Mr. Jennings helped me get through a very difficult time early in my career and I have remained loyal to the bank ever since.
Do you have a book, podcast, or talk that’s had a deep impact on your thinking? Can you share a story with us? Can you explain why it was so resonant with you?
Malcolm Gladwell’s book the Outliers showed me the importance of not being afraid to be different, taking risks (accepting failure and rejection as something better might be around the corner), and putting in the time if you wanted to be successful.
Can you please give us your favourite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
I have two, one short, one long. The first is my motto: “Failure is only Important if it’s the last time you try”. This has inspired me to develop huge resilience and never to give up if I want something or believe in something
The second is my favourite quote which is from Steve Jobs: “Here is to the crazy ones, the misfits, the rebels, the troublemakers, the round pegs in the square holes, the ones who see things differently, they’re not fond of the rules, and they have no respect for the status quo. You can quote them, disagree with them, glorify or vilify them. About the only thing you can’t do is ignore them because they change things. They push the human race forward and while some may see them as the crazy ones, we see genius because people who are crazy enough to think they can change the world are the ones who do.”
This quote has inspired me to take risks, to do what I feel is right, even if it’s against the prevailing thinking. This has impacted me both in business and politics, often if not always for the better.
Let’s now shift to the main part of our discussion about the shortage of affordable housing. Lack of affordable housing has been a problem for a long time in the United States and the UK. But it seems that it has gotten a lot worse over the past five years, particularly in the large cities. I know this is a huge topic, but for the benefit of our readers can you briefly explain to our readers what brought us to this place? Where did this crisis come from?
Whether in business or politics I have always thought of myself as a problem solver. The current government in the UK talks a lot about levelling up but levelling up is not just about a North-South divide but begins right at the bottom of society, with the homeless especially rough sleepers. I have always felt that the problem of rough sleeping is not insurmountable if there is enough political will. If we can come up with £2 trillion to bail out the banks, we can come up with a fraction of that to resolve the problem of rough sleeping. I first became conscious of rough sleeping when I worked in New York in my mid-20s, almost forty years ago.
The problem was very visible. I initially did some voluntary work at Covenant House in New York and continued my interest in this area as a volunteer when I returned to the UK with Crisis and the Salvation Army and then when I became an MP with my local homeless charities in Braintree. When I left Parliament in 2015, I worked once a week at a ‘soup kitchen’ in Lincoln’s Inn Fields, and also at Crisis at Christmas. I realised that many of the homeless people I met had neither the support nor the breaks that I had had. In 2016/17 I set about working on a report into homelessness and rough sleeping with the support of Crisis and the Centre for Social Justice. I looked at best practices around the world and settled on a Finnish Solution called Housing First, which sets no conditions to providing housing and provides professional support for rough sleepers many of whom suffered mental health and substance abuse problems. The concept of providing support with housing led to the Finns almost eradicating rough sleeping. I made my recommendations in my report ‘Housing First: Housing led Solutions to Roughsleeping and Homelessness’ that the UK Government should consider a similar policy to the Finns. The Government adopted my recommendations in their 2017 Manifesto and when elected piloted my scheme in three cities: Manchester, Birmingham, and Liverpool.
Can you describe to our readers how your work is making an impact to address this crisis? Can you share some of the initiatives you are leading to help correct this issue?
My Housing First report and piloting of the scheme led to a subsequent report in 2020 to look at the findings of the pilots. The evidence was almost everyone in a Housing First project remained in housing and did not return to the streets. Having no conditions and providing support with housing seemed to be a critical part of the solution. The Government now needs to roll out Housing First nationally and I am doing my best to put pressure on Ministers especially in the Department of Levelling Up Housing and Communities to do precisely this.
Can you share something about your work that makes you most proud? Is there a particular story or incident that you found most uplifting?
The volunteering I did with Crisis and the Salvation Army and with my local homeless charities in Braintree when I was an MP is something I am very proud of. When I was working in a soup kitchen I was faced with the reality of homelessness and the need for urgent, radical change to eradicate rough sleeping. This was the basis of my report with the Centre for Social Justice and is the foundation of the work I do today to communicate the importance of the Housing First model.
In your opinion, what should other home builders do to further address these problems?
There is a paucity of affordable housing as well as social housing. An important part of the Government strategy should be to ensure that home builders provide the right balance between new housing, affordable housing, and social housing. The right balance between all three will ensure we have less homelessness and truly begin to level up society.
Can you share three things that the community and society can do to help you address the root of this crisis? Can you give some examples?
The Government should encourage the roll-out of the Housing First model and should address the growing need to build more affordable housing. This will help people onto the housing ladder and there also needs to be tighter regulations on landlords who provide incredibly poor housing especially for those who find themselves in “bed and breakfast” accommodation.
If you had the power to influence legislation, are there laws which you would like to see introduced that might help you in your work?
Yes, I think there needs to be better legislation for landlords especially those who provide accommodation for those who are in need of short-term or emergency housing. The prices tend to be very high and the accommodation is often very poor with many examples of black mould and vermin in the accommodation. There needs to be a list of those who qualify by meeting these standards as there is for Nursing Homes.
Surround yourself with smart experienced people. For most start-ups, the entrepreneurs often think they know everything. They don’t. They tend to end up surrounding themselves with people who agree with them. You want to always be challenged robustly on how the business was run. Yes, you are the ultimate decision maker but you want people who are more experienced than you in a variety of areas to constantly challenge your thinking and ideas.
Cash is king. Many great start-ups fail not because they aren’t great ideas, they simply run out of cash. Always raise more cash than you think you need.
Get feedback from everyone in the organisation not just the people at the top. Often staff at the sharp end of your business and on the front line know where problems are emerging before they work their way up the organisation. Proactively talk to everyone you can respond to changes and challenges.
Nothing ever goes according to plan — ever! I have never seen a business plan executed. Ever. You learn to adapt and to adapt quickly to circumstances. But when circumstances deviate from a plan you must communicate this with your shareholders and staff, and have a solution.
Shit happens. Sometimes things can go wrong for reasons out of your control. The key is to respond in a measured way and think through clearly when something really goes wrong. Don’t overreact. Don’t whine. Leadership is about handling tough situations and problem-solving.
If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be?
I currently have an education charity A Partner In Education (www.apartnerineducation.org) that focuses on early years learning in developing country settings. I have built a primary school for 300 children in Rwanda and a teacher training centre that focussed on early years learning and sharing best practices. If we invest more in early years learning and better teacher training in developing countries this will impact millions of children living at or near the poverty line and provide a “hand up” not a “hand out” for future generations to have a better standard of living and more opportunities to lead a better life.
Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why?
Breakfast with Warren Buffett (he is probably an early riser) to pick his brains and experience in successful investing and what he sees as the key success factors to good and bad companies.
Lunch with Bill Clinton (he is probably not an early riser) to draw on his wealth of experience in how he deals with people and to see his emotional intelligence first hand.
How can our readers further follow your work online?
This was very meaningful, thank you so much, and we wish you only continued success.