The horizon is made hazy with dusty air\u2014a consequence of high levels of pollution<\/a>. New high-rise housing properties\u2014with their sleek steel metal frames<\/a> and vivid pops of color<\/a> demanding $3,000 per month on average<\/a>, which are cropping up along the neighborhood\u2019s waterfront\u2014stick out like sore thumbs against the backdrop of longtime staples<\/a> like laundromats, bodegas, and vacant buildings.\u00a0<\/p>\n Sunny Nagpaul<\/p>\n<\/div>\n The South Bronx faces many of the same challenges that scorn the rest of the country, namely too little financial funding for small and local businesses, unaffordable housing, rampant inflation, and insufficient neighborhood safety. Decades of redlining and disinvestment<\/a>, combined with a historical legacy of environmental racism<\/a> in the area has created a perfect storm of poverty. The community, though, is much more than a cross section of consequences of the country\u2019s poorest policy<\/a> decisions<\/a>, which are now so dire<\/a> the majority of Americans feel intense stress and uncertainty<\/a> about their ability to buy homes<\/a> and even keep food on the table<\/a>. <\/p>\n While the South Bronx has been hit hard, it\u2019s learned resilience as well. Fortune<\/em> spoke to several South Bronx entrepreneurs who have set their sights on making it: doing what they love in their home borough, and creating business models built around improving the neighborhood\u2019s core issues.\u00a0<\/p>\n The journeys people take to become business owners in the South Bronx is as diverse as the people who live there<\/a>, a largely Hispanic and Black population of roughly 727,000.\u00a0There\u2019s Carlos Cortes, who crossed the ocean from Puerto Rico to bring a branch of his family\u2019s 94-year-old chocolate company<\/a> to the Big Apple; Omar Canales, who manages internal technology at his cousin\u2019s family-owned restaurant<\/a>, which specializes in the cuisines of the six regions neighboring Mexico in Central America (and is also one of the only sit-down restaurants for miles in the neighborhood); and there\u2019s Eric Kelly, a former U.S. national boxing champion who opened a gym<\/a> to help South Bronxites\u2014from children to the young and addicted\u2014indulge in a healthier outlet for their stresses, which he believes was instrumental for himself growing up in Brooklyn.<\/p>\n But you cannot understand the story of the South Bronx without delving into the policies and decisions that now fuel its residents\u2019 disproportionate stresses. As the poorest congressional district<\/a> in the country, the South Bronx has long lacked resources like recreational options for youth<\/a>, funding for schools and access to internet,<\/a> access to healthy food<\/a>, commercial investment<\/a>, and banking relationships<\/a>. Then there\u2019s the construction of several major highways and bridges, which reports<\/a> cite as examples of environmental racism<\/a>, or designing cities such that communities of minorities or people of color experience the most detrimental health effects, like polluted air and few green spaces<\/a>.\u00a0<\/p>\n Sunny Nagpaul<\/p>\n<\/div>\n Several expressways, including four major highways<\/a> and bridges, crosshatch right through the center of the South Bronx to service food-distribution centers, waste-management facilities, and factories, resulting in at least 15,000 trucks passing through the South Bronx daily. Its residents make up just 6.5% of the city\u2019s population,<\/a> yet host two-thirds of the city\u2019s waste sites, incinerators, and factories. As a result, the borough\u2019s asthma-related complications are sky-high<\/a> compared to the rest of the city. According to city data from 2021<\/a>, Bronx children under age 17 experienced six times the amount of emergency room visits for air pollution-related asthma than any other borough.<\/p>\n Leveling with so many historic challenges, South Bronxites seem to have leaned into the \u2018small but mighty\u2019 mentality. Small businesses have played an oversized role<\/a> in the South Bronx economy for decades due to cheaper start-up costs and reluctance from larger enterprises<\/a> to invest there. The average business employs just four employees, and nearly 95% of business owners rent their space, according to a 2022 study<\/a> by the New York City\u2019s Small Business Services.\u00a0<\/p>\n Nearly half of businesses don\u2019t have a website. A look at the neighborhood\u2019s retail landscape reveals the majority of storefronts\u2014about 9.5% in the neighborhood\u2014are delis or bodegas, followed by restaurants (8.3%) and those that are vacant (also 8.3%). In Mott Haven, located along the Harlem River on 138th Street and bordered by the Melrose, Port Morris, and Hunts Point neighborhoods, the average age of a business is 11 years, and one in six businesses have been operating for more than 20 years.\u00a0<\/p>\n The challenges these business owners face\u2014like securing financial and government support, dealing with city regulations, and inflation\u2014are much the same as the rest of the country, but with an important differentiating factor: The immense level of poverty has remained largely unchanged for decades.\u00a0<\/p>\n Sunny Nagpaul<\/p>\n<\/div>\n That worry is top of mind for Omar Canales<\/a>, who has spent the last 12 years helping operate his cousin\u2019s Central American restaurant, Seis Vecinos<\/a> (which translates to Six Neighbors, representing the Central American countries alongside Mexico). Canales, who received his master\u2019s degree in business management at Pace University, told Fortune<\/em>, \u201cthe most nerve-wracking thing at the top of everyone\u2019s list right now is inflation.\u201d<\/p>\n \u201cNo one wants to sacrifice quality because that\u2019s the reason why people come back. It\u2019s the never ending topic of the cost of goods for everyone going up,\u201d he said, \u201cwhile the poverty line remains the same.\u201d\u00a0\u00a0<\/p>\n Canales grew up in what he described as \u201cthe projects,\u201d in Soundview\u2014and at around age 14, moved roughly three miles west to the South Bronx neighborhood of Morrisania in 2000, where he still lives now.\u00a0<\/p>\n Between 2011 and 2021, the share of South Bronx households below the federal poverty line declined from about 39.7% to 36.3%, according to a New York State Comptroller report<\/a> on the South Bronx economy, while major expenses, like housing, have been rising disproportionately. The report found the area\u2019s median income rose by about 30% within the decade, while median rents increased by over 40%, leading to more renters spending over a third of their income on rent by 2021, too.\u00a0<\/p>\n When it comes to keeping up with the cost of goods, Canales said, you win some and lose some. Some factors, like his neighborhood\u2019s two-mile vicinity to the Hunts Point Cooperative Market\u2014the largest food distribution center in the world<\/a> that generates about $2 billion in annual revenue<\/a> and services supermarkets, restaurants, hotels, and country clubs in the tri-state area\u2014certainly helps keep costs low. Price hikes on imported ingredients required for certain Honduran specialties, however\u2014like cheeses, seafood, and spices\u2014are harder to deal with.\u00a0<\/p>\n \u201cWe can offer traditional items within the five- to eight-dollar range, at most ten. But then we do have our soups and extravagant dishes that you can easily spend $30 to $40 per person, and for the South Bronx, that is expensive. If we\u2019re talking Manhattan prices, that\u2019s just very normal.\u201d\u00a0<\/p>\n \u201cWe raise prices,\u201d he warned, \u201cpeople notice.\u201d<\/p>\n Another challenge many small businesses face includes accessing state and city financial funding meant to aid small local businesses. Audits<\/a> by City Comptroller Brad Lander, released in December 2022, reveal that city small-business grants underserved the Bronx as a whole. During the pandemic, businesses in the Bronx received only 7% of the $25 billion in federal Paycheck Protection Program loan funds that were distributed city-wide, and received less than 2.3% of pandemic-era city loans and grants, the audit found.\u00a0<\/p>\n The reasons why the Bronx typically receives a smaller share of city funds, according to Lisa Sorin, the president of the Bronx Chamber of Commerce<\/a>, is largely due to its historically negative reputation, which lowers incentives for economic investment, and inadequate communication between city agencies and Bronx business owners.\u00a0<\/p>\n \u201cThe historic perception of the South Bronx was that it\u2019s not the best place to do business,\u201d Sorin told Fortune, <\/em>adding that development\u2014like housing around Mott Haven\u2014has changed some of that perception. \u201cEspecially on the waterfront, businesses realized that there were opportunities that weren\u2019t there before.\u201d\u00a0<\/p>\n Addressing communication issues, she said, is also critical\u2014and involves bridging the language barrier with Spanish-speaking business owners as the borough has a majority Hispanic and Black demographic<\/a>. \u201cThe government in general does not do enough to get information out to minority communities,\u201d Sorin told Fortune<\/em>.<\/p>\n Another challenge: Requirements for low-income loans often include high credit scores and the ability to show years of tax return records, which are often difficult for small businesses that operate in cash to provide.\u00a0<\/p>\n \u201cWhen you own mom-and-pop stores, accounting is a very loose thing,\u201d Sorin explained. \u201cAll these things are taken into account when you\u2019re applying for massive grants, so it was a matter of finding banks that were willing to help them clean up their books so they can access these financial resources.\u201d\u00a0\u00a0<\/p>\n Sorin began partnerships with the few banks that service the neighborhood, namely TD Bank<\/a> and Ponce Bank<\/a>, to help entrepreneurs with their applications.\u00a0<\/p>\n This tendency of oversight, however, combined with lack of access to legal help, has left many business owners jaded and cynical of the city\u2019s ability to support them.\u00a0<\/p>\n Canales told Fortune<\/em> that applying to city grants \u201cjust felt kind of like a raffle.\u201d<\/p>\n \u201cInconsistent coordination and communication between government agencies and local community organizations causes reluctance among merchants to participate in initiatives designed to support the commercial district,\u201d concluded a 2022 report from the Bronx Chamber of Commerce and the city\u2019s Small Business Services agency.<\/a>\u00a0<\/p>\n More opportunities to apply for loans did come later, in August 2023, when New York Empowerment Zone Corporation<\/a> announced the allocation of $10 million in loans<\/a> of $5,000 to $350,000 for small Bronx businesses, to be administered by the Bronx Economic Development Corporation<\/a>.<\/p>\n While the new loans are a step in the right direction, Sorin cautioned that many Bronx business owners are not out of the woods yet.\u00a0Since the pandemic, she said, \u201cbusinesses have not gone completely back to what I consider normal.\u201d For instance, many businesses that were once open 24-hours are now open until midnight. In general, she said, \u201cpeople are still very cautious as to where they spend their money.\u201d\u00a0<\/p>\n Then there\u2019s the topic that, in Canales\u2019 words, \u201ccould suck the air out of any room,\u201d and is also another issue made tougher due to the neighborhood\u2019s disproportionate poverty: unaffordable housing.\u00a0<\/p>\n According to a May report<\/a> by StreetEasy, rental<\/a> inventory<\/a> increased<\/a> the most in Mott Haven in the South Bronx than anywhere else in the city, up more than 85% from the same time last year. The median asking rent in the neighborhood was $3,050. Meanwhile, the average South Bronxite earns $2,100 per month, while the median household income is $3,500 per month, according to data<\/a> from the U.S Census. While some new housing<\/a> buildings<\/a> recently opened in the South Bronx, including market-rate<\/a> and income-restricted units<\/a> meant to service low- to middle-income households, they can still contribute to pricing people out<\/a> of the neighborhood, or staying vacant<\/a> due to lack of interest.\u00a0\u00a0<\/p>\n Carlos Cortes, who settled in the South Bronx in 2021 to open a branch of his family\u2019s chocolate manufacturing company<\/a>, founded 95 years ago in Puerto Rico. He made the move with the help of a New York State initiative<\/a> aimed to bolster business partnerships with the island territory.\u00a0<\/p>\n But the years since have not been without their troubles. With many of the new apartment buildings still not filled<\/a>, restaurant owners like Cortes are seeing less foot traffic, which, as his primary source of income, is his biggest challenge.\u00a0<\/p>\n \u201cCompanies are building out all these developments nearby, and we\u2019re depending on that traffic to eventually manifest,\u201d Cortes told Fortune<\/em>. \u201cAt the same time, it feels as though they\u2019re not also investing back into the community so the neighborhood is clean and safe.\u201d<\/p>\n Additional challenges he faces include sanitation and safety, as incidents of petty crime make broken streetlights or looted cars a frequent sight. His own shop was broken into four times in October 2023.\u00a0<\/p>\n Dealing with the pandemic as a small business in the food industry, he said, has also left him with \u201ca lot of loans to pay off.\u201d He tried to make several improvements to his storefront, like requesting permission from the city to paint a mural on the underpass of the bridge nearby and to relocate a Citibike stand so he could install outdoor seating on his storefront\u2019s portion of the sidewalk.\u00a0<\/p>\n \u201cTwo years, I\u2019d been asking for that,\u201d Cortes told Fortune<\/em>, adding that after several months of emails that went unanswered, the Department of Transportation refused his request. \u201cIt\u2019s red tape everywhere. I\u2019m trying to help the community in terms of making the neighborhood feel alive, lived in and safer. I feel abandoned sometimes.\u201d<\/p>\n Sunny Nagpaul<\/p>\n<\/div>\n Bringing more vitality and life to the neighborhood is also the main inspiration of another neighborhood entrepreneur, 41-year-old Michael Eagan, who also goes by his stage name DJ Spynfo. Eagan, a Mount Eden-native, established his venue and performance space, called Sankofa Haus<\/a>, in early 2021, and has hosted events from financial-advice panels to private graduation and birthday parties, group yoga, and dance parties ever since.\u00a0<\/p>\n His goal, he told Fortune<\/em>, is \u201ccreating a safe space in the South Bronx for burgeoning entrepreneurs.\u201d\u00a0<\/p>\n His performance space is a multi-use facility that primarily focuses on private events, but also offers free community events with themes like Women\u2019s History Month and spoken-word open mics. Eagan, who studied communications and business at St. John\u2019s University in Queens, told Fortune<\/em> the idea behind the space starts with its name, Sankofa Haus, an African proverb that means \u2018go back and get it.\u2019\u00a0<\/p>\n Often, Eagan said, Bronxites gain \u201caccess to education and information, and they may travel and find better job opportunities. With this project, I am trying to find creative ways to bring information back through events.\u201d\u00a0<\/p>\n He believes many of the neighborhood\u2019s biggest issues, like break-ins and street violence, trace back to inadequate investments in schools and mental-health resources.\u00a0<\/p>\n \u201cThose are all stemming from lack of self-esteem and mental-health problems, whether they know it or not,\u201d he said. \u201cThe city should focus on the pervasive mental health crisis that\u2019s taking place, and find the tools, like music and medicine, that would help mitigate it as the number one thing in order for all businesses out here to flourish.\u201d\u00a0<\/p>\n The impulse to take care of the community, starting with its youngest members, is not lost on other entrepreneurs, too. Eric Kelly, a 42-year-old Florida-native who grew up in Brooklyn, is a four-time national boxing champion and former member of the U.S Olympic Team who co-founded a gym, called South Box<\/a>, with his business partner Andrew Roth in 2017.\u00a0<\/p>\n Sunny Nagpaul<\/p>\n<\/div>\n Kelly\u2019s father introduced him to the sport when he was \u201cjust a little kid,\u201d he told Fortune<\/em>, and he instantly fell in love with it. Winning fights built his confidence, he said, and \u201cthrough that I just found a joy and love for teaching.\u201d\u00a0<\/p>\n Kelly\u2019s gym, which opened in June 2017, employs three full-time staff and relies on a personal network of private trainers hired on contract to connect aspiring athletes with professional trainers at affordable prices. The bulk of the gym\u2019s clientele, Kelly said, are young adults in their twenties who are looking to compete, but also includes children as young as age 6. The main goals for the space, the duo said, is to offer a healthy outlet for anybody from children to adults to express their rage and aggression.\u00a0<\/p>\n That goal came to life last spring, when the boxing gym partnered with Bronx Community Justice Center<\/a> to train formerly kids who\u2019ve been arrested or served time in juvenile detention for two months through twice weekly classes. The gym also partners with local charter schools and community programs to offer youth lessons.<\/p>\n \u201cYou need to have an outlet so that it doesn\u2019t destroy your life,\u201d Kelly said.<\/p>\n Sunny Nagpaul<\/p>\n<\/div>\n Roth agreed, adding, \u201cIt\u2019s a very interesting alchemy that happens at the gym.\u201d\u00a0<\/p>\n The importance of caring for the community\u2019s needs\u2014both physical and spiritual\u2014is something many entrepreneurs seem to intuitively understand.\u00a0<\/p>\n \u201cThe lack of respect for people\u2019s property is a problem when it comes to running a business,\u201d Eagan of Sankofa Haus said, but he also recognized that many of the people who cause petty crime \u201cmight just be trying to survive.\u201d\u00a0<\/p>\n The community\u2019s intense poverty, he said, is not just a challenge to respond to, but a window for empathy that you could open, should you choose.\u00a0<\/p>\n \u201cWhen someone turns over my garbage and rips through it to get some food, they\u2019re not thinking about me, clearly. They\u2019re thinking about putting something in their belly,\u201d he described. \u201cIt can be very challenging, but I know what we\u2019re doing in the South Bronx right now is going to inspire another generation, my son, and it\u2019s going to inspire his friends.\u201d\u00a0<\/p>\n Sorin, who has been closely observing the state of Bronx businesses as the chamber of commerce\u2019s president and member of several New York City council boards<\/a>, feels optimistic about the business climate despite the hardships.\u00a0<\/p>\n \u201cSankofa Haus now offering such a beautiful space for events would not have been the case 10 years ago because there was nothing but unused warehouses,\u201d she said, adding \u201copportunities have opened up because of the development and pricing in general.\u201d<\/p>\n But as most Bronxites could tell you, the real value of the neighborhood lies far deeper than the market price of new housing developments and revitalized waterfronts.<\/p>\n Sorin told Fortune, <\/em>\u201cI happen to believe the Bronx was always that gem, and that people just didn\u2019t realize how fabulous it is until they were forced to look at us in another way.\u201d\u00a0<\/p>\n<\/div>\n![\"A](\"https:\/\/fortune.com\/img-assets\/wp-content\/uploads\/2024\/06\/Bridge-South-Bronx-IMG_5736.jpg?w=1440&q=75\"\/)
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<\/p>\nTo improve the community, you need early investments <\/h3>\n