Self-Made: How Lance Draper is building an empire of affordable housing
Published on: October 28, 2014
John Minervini, High Ground News
The myth of the self-made man is mostly just that: a myth. Bill Gates had rich parents who supported his business; Donald Trump had a trust fund worth millions. In fact, according to a 2012 study by United for a Fair Economy, only 30% of the Forbes 400 can legitimately claim to have made their money from scratch.
And then there’s Lance Draper. All right, he may not be on the Forbes 400. Then again, he’s got some time. Now 25 years old, he bought his first house when he was just 18.
“Growing up in Westwood,” says Draper, “I saw how people were content to live off the government. It’s like, just as long as they had that beer and that cigarette, they were content with basically nothing. It felt like I would do anything to not be like that.”
Draper is the grandson of Lafayette Draper, the famous Memphis bartender for whom Lafayette’s Music Room is named. But the Drapers aren’t rich. In fact, for most of his adult life, grandfather Lafayette also worked part-time as a dock worker at Sears Crosstown. Lance grew up in a working-class neighborhood in South Memphis.
So when it came time to start a business, Lance was on his own. He bought his first house, a 3-bedroom in Memphis’s Indian Hill neighborhood, at a government auction in 2009. The real estate market had hit bottom, and Draper got it for a mere $6,420—the cost of back taxes that were owed on the property.
“People like to say, you know, somebody must of gave him something,” he says. “But they didn’t! I saved that money.”
“I’m extremely cheap,” he adds. “I don’t buy myself anything.”
Those first few months were tough. To pay for the house, Draper spent his life savings, which he had earned at his job as a grocery store check-out clerk. Plus the property needed a lot of work. Before a tenant could move in, Draper had to install central air conditioning, repaint the house inside and out, and install new siding and trim.
Those improvements weren’t cheap. Even though he did most of the work himself, the materials cost about $2500—a significant sum for an 18-year-old who had just drained his savings account. But Draper says he knew it was worth it when he got his first rent check in the mail.
“It felt so good, opening that envelope,” Draper recalls. “And I said, this is what I’m gonna do. I’m gonna figure out a way to keep this going.”
Today, Draper owns six rental houses around Memphis. But the crown jewel in his burgeoning real estate empire is a multifamily apartment complex at the corner of 5th and Greenlaw, just around the corner from the Pyramid.
Purchased this year for $330,000, the building is a handsome, two-story affair that Draper painted a mineral blue. Its 16 one-bedroom apartments, each about 800 square feet, come equipped with hardwood floors and brand new appliances. Although previously, Draper has paid for all his homes in cash, this time he applied for and received financing from Memphis’s Financial Federal.
“I don’t want to say they took a chance,” says Draper, “because I always knew it was gonna work. But I sure do appreciate what they did.”
Going forward, Draper says he’s interested in attracting a group of investors and buying a residential building in the center of Downtown. Although he’s certainly in it for the money, he says he’s also interested in making Memphis a better place to live.
“Before 2009,” he says, “this neighborhood was extremely run-down and dangerous. But it’s coming back now, and I believe I have been a part of that. I keep my properties clean, and I only rent to good, working-class people.”
Despite his success, Draper is still a penny-pincher. To save money, he lives at home with his grandparents. But these days, he’s finally allowed himself one indulgence: a sleek, gray Infiniti Q50.
It’s a profoundly sexy car, with supple leather seats and an illuminated console that wouldn’t look out of place on a Gulfstream G650. All of which raises the question: what about a significant other? Now that he’s got the car, is Draper in the market for someone to ride shotgun?
“I’m working on it,” he says, with a laugh. “The way I’ve always looked at things is, no finance, no romance.”