A Matter of perspective

"To diagnose a system or yourself while in the midst of action requires the ability to achieve some distance from those on-the-ground events. We use the metaphor of 'getting on the balcony' above the 'dance floor' to depict what it means to gain the distanced perspective you need to see what is really happening.”

- Ronald Heifetz and Marty Linsky, Principles of Adaptive Leadership

This was the core concept in our assigned reading ahead of a 3-day series of working meetings in Chicago, hosted by CCI as part of the Sustainable Communities Investment Accelerator.

When you’re on the 'dance floor,' you’re immersed in the day to day – struggling to keep your head above water, while trying to protect time for important strategic work. You’re not seeing the big picture – you’re stuck in your own experience.

When you get up 'on the balcony,' you can see the patterns, trends, and power dynamics that make up the big picture. You can get out of your own head, see where you fit within the larger system, and act accordingly.

The goal is to develop the ability to move back and forth between the dance floor and the balcony – to cultivate an awareness of how your day-to-day actions play into the bigger picture, along with a sense for when it’s time to step back, re-evaluate, and adjust course.

This idea combines well with the Three Horizons Framework we introduced in an earlier post.

The ‘dance floor / balcony’ exercise is like zooming in and out with a camera lens or moving up and down in space. Three Horizons is like moving back and forth in time. 

With support from CCI, we got up on the balcony and applied the Three Horizons Framework to see how our work through Retrofit LA can serve as a bridge from Horizon 1 (status quo) to Horizon 3 (the future we choose).

After plastering a flipchart with sticky notes describing each of the Three Horizons curves, here’s where we ended up:

• Horizon 3 – the future we choose 

  • Preserve & fully utilize existing affordable housing 

  • Long-term ownership in the hands of local mission-aligned organizations

  • New production serves the missing middle + aligns with real needs 

• Horizon 2 – the bridge, what we’re doing now that we want to accelerate

  • Preserve existing affordable units (decarb + rehab + stabilization)

  • Develop and deploy flexible bridge financing models

  • Protect organizational financial sustainability

• Horizon 1 – aspects of the status quo we want to let go of 

  • Capital in silos, expensive to access 

  • Lack of flexibility to adjust rents to cover rising costs

  • Residents staying too long in restricted / temporary units

We have come back inspired, recommitted, and stronger than ever.

In the words of Omar Carillo, “We are accountable to the future we want, in the present.”

Now let’s dance!

Monthly Updates

Shared Priorities

• Better Neighborhoods, Same Neighbors — everyone should have access to affordable, secure, healthy housing

• By 2028, our cohort partners will retrofit 55 properties (almost 2,000 units) in East LA, DTLA, Little Tokyo, and South LA

• Strengthening organizational capacity and resident engagement, with tenant comfort and affordability as the shared north star guiding equipment, solar sequencing, and electrification decisions

• Share generated data as a catalyst to reform the enabling environment

Pipeline

ELACC

• Win: Broke ground at 137 North Soto, completed EV charger construction at Sol y Luna in about a month, and received a county notice of award. 115 North Soto and 319 North Cummings are moving through incentive reconciliation ahead of final closeout.

• Challenge: Solar program may require separate service drops. Contractor deposits are straining cash flow.

• Response: Negotiating deposit terms, pursuing exceptions / evaluating other programs, and holding contingency until budgets clear.

LTSC

• Win: LIWP funding was extended, clearing the way to finish HVAC work at Angelina. GoZero bids are in process for three more properties.

• Challenge: Heavy property management turnover, including a major partner merging into a larger company, is putting institutional knowledge at risk.

• Response: Centralizing records and account access, considering potential strategies to self-manage assets.

Esperanza

• Win: The LIWP extension unblocked three properties that had been waiting on funding. 

• Challenge: Getting solar in place prior to electrification would avoid raising resident bills, but could push construction start dates and impact electrification incentives. Solar also requires roof replacement, estimated at $200,000.

• Response: On future projects, sequence solar before electrification to mitigate bill impacts. In parallel, exploring roof and solar financing through aDeal Room with the Milken Institute scheduled for mid-September.

Enabling Environment

• Aligning Policies & Programs: We continue to depend on relationships with LADWP, LAHD, and LACAHSA to align and streamline programs to support preservation.

• Fundraising & Capital Structure: We're modeling recapitalization scenarios across LIHTC and non-LIHTC properties in preparation for upcoming application cycles, and using the results to inform our broader fundraising strategy.

• Health Co-Benefits: Sustento is working with National Lab of the Rockies to finalize a report on the health impacts of extreme heat in Los Angeles. Buildings have been selected for Indoor Air Quality analysis by UCLA this Fall. Together, these efforts will support the case for investment in housing as healthcare.