A Secure Future

Tremaine Wright used home equity to start her dream business

No one is more passionate about coffee than 35-year-old Tremaine Wright. Last March, she opened a coffee shop in her Bedford-Stuyvesant neighborhood in Brooklyn, New York. Hard work and dedication played a role, but her dream wouldn’t have been possible without thoughtful real estate investment decisions.

It all began in 1998 when Wright was in her second year of law school at the University of Chicago. Her grandfather, who had been living alone for three years, decided to leave New York and move into an assisted living community in Pennsylvania near other relatives. But he wanted to keep the Brooklyn brownstone he had purchased in the 1950s for $20,000 in the family. There was one problem: Who would take over the mortgage payments?

“I volunteered to take over the payments and the care of the house,” says Wright. “I wanted to help.” Her grandfather had refinanced twice to cover general household expenses, so the mortgage balance was $140,000. Since Wright was still in school and had no income, her mother, Gwendolyn, agreed to help out and make the monthly mortgage payments of $1,100. Wright took over after she graduated in 1999 and snagged a job at a corporate law firm earning $90,000.

The three-story brownstone, now worth $700,000, has four bedrooms and three bathrooms. “I was like ‘Wow, I own a house,’?” recalls Wright. She didn’t need all that space, so she invited some family members to move in to the top floor, and a friend from church took over the second. The tenants paid $700 each, about half the cost of maintenance and mortgage. Wright lived on the ground floor.

The story would have ended there if it hadn’t been for Wright’s coffee habit. The recovering coffee-holic admits to drinking up to 10 cups a day as a student. She noticed that her neighborhood lacked gathering space. Few area restaurants had seating, and there were almost no bars or coffee houses. “Every time I wanted to meet with friends, it had to be in the house or outside of the neighborhood,” says Wright.

So she considered opening a coffee shop and began educating herself. Wright subscribed to coffee trade magazines and attended coffee and food shows in Atlanta and Washington, D.C. She also enrolled in a one-day course at a local university entitled “How to Operate a Coffee Bar or Tea House.” In addition, Wright entered Brooklyn Public Library’s PowerUp! Business Plan Writing Competition and won an honorable mention prize of $3,000. As she educated herself about the coffee retail business, she began to rein in costs for lifestyle extras so she could save for startup costs. Excellent money management, in addition to a $35,000 salary increase shortly after she joined the law firm, enabled her to sock away $100,000 in savings.

When Wright began to look for commercial space to rent in 2003, she calculated that her startup costs would be around $150,000, so she needed to have an additional $60,000 at the ready just in case she found a rental property she

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