Kọ Cafe Celebrates 1 Year in Business and Commercial Real Estate Win

Imagine taking on a risk and opening up a brand new brick & mortar cafe. Then, 1 year later, you are now the proud owner of that same commercial building that you once rented to operate your business! This is the true story of Kọ Cafe, an African inspired coffee shop and creative event space cultivating what feels like a home for community and culture in Jersey City, NJ. 

Here’s Their Story:

Inspired by frequent cafe visits in Ghana and a knack for entrepreneurship, a group of friends decided that it was time to transform their dreams into reality by finally opening up a coffee shop in Jersey City, NJ on February 25, 2023. While Jersey City may appear to be an up and coming city, it was still lacking something: a true sense of community, culture and creativity. These men all realized that bringing this cafe to a city like Jersey City would ultimately be a win not only for their business, but most importantly, for the residents of the area as well as the professionals and families leaving NYC in pursuit of a new city to call home. Now, having served 100s of customers and numerous businesses, cofounders Isreal Adeyanju, Sam Osei Afriyie, Olubanwo Aruleba, Daniel Adeyanju, and Victor “ Vick ” Adeyanju, can happily celebrate their 1-Year Anniversary. 

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In just 1 year, these ambitious men have accomplished the following:

• Created an aesthetically pleasing cafe atmosphere for customers to feel safe, creative and productive (shoutout to Kọ’s barista Raymond for the amazing drinks and customer service).
• Launched an ecommerce experience, Kọ Shoppe, designed by Lulu Khasa, which sells products created by numerous businesses including Beard Dad, Back Home Seamoss, Uzo Art and of course, Kọ Cafe’s very own coffee beans. 
• Launched a customer loyalty program.
• Held 20+ events, including brunches, elevated dining experiences, co-working Fridays and more, dedicated to bringing the community together.
• Opened Kọ Studio, a versatile event space which can be used for podcasting, pop-up shops, team meetings, workshops, art exhibits and more. Artists such as Isokenny have also used their space.
• Landed sponsorships with historical venues including Barclay Center for Afrobeats artist Asake (thanks to Duke Concept) and the Apollo for Poetry Me Please (thanks to Rashan Brown).
• Their grandest win? PURCHASING COMMERCIAL REAL ESTATE.

Let’s dissect this huge win!

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The most powerful means of building wealth in America is through real estate. - John Hope Bryant, Founder of John Hope Bryant Holdings

What this team planned on accomplishing in 2-3 years, happened in just 1. When the founders of Kọ Cafe found out that their building was up for sale, they immediately pounced at the opportunity and did so with absolutely no cash on hand. Just 6 months after opening the business, the building was up for sale. They were able to work with Nestment, a platform that enables co-buying amongst friends and family serving as a third party cosponsor by assisting buyers with location strategy, LLC creation, operation agreements, closing and more. Nestment also contributed capital towards the closing of this purchase, something the company does not typically do, which was a huge win for the team. The Kọ Cafe team thanks Director of Partnerships at Nestment, Matt Trocker, for this help. 

Key Steps in Their Commercial Real Estate Process

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Vision, Planning, Strategy

Know what you want and who you are building with. Then, pounce!

The Kọ Cafe team knew that they wanted to purchase this building in 2-3 years and decided to start planning towards a process for accomplishing this. Little did they know that this process would start a lot sooner. However, although a tough process, their early preparation due to their vision provided them with a solid start. Once the building was up for sale, they immediately took action despite not having the initial capital. 

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Relationships

If you are interested in real estate and genuinely care for the community you are purchasing property in, you must develop relationships.

The real estate process is all about relationships. The Kọ Cafe team recognized that. Even before pursuing the sale of the building, they had been planting seeds and nurturing relationships with others in the neighborhood. These relationships included residents, rentors, investors, and developers. They even built relationships with local business owners and contractors such as plumbers and electricians. How did they build these relationships? By promoting the work of these owners/contractors to customers and seeking nothing in return; not even referral fees. These relationships became a form of currency because these contractors even helped out Kọ Cafe with minor facility issues at a reduced cost. Their biggest win from relationship building? Developing such a great rep in the community that their broker, an Asian woman who grew up in Jersey City, highly supported them and convinced the Chinese building owners that this group of Black men were the right fit to be buyers of this building. 

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Financing & Closing 

Know where your funds are coming from.

There are three things to keep in mind when it comes to real estate costs: the down payment, the loan being taken out on the purchase of the building and remaining closing costs. 

Kọ Cafe was able to secure a down payment investment from a friend and supporter of their vision valued at $25,000. This provided the team with an opportunity to purchase this property with no money down. 

However, that is not the only cost hurdle. When it comes to the remaining balance of purchasing a building and closing costs, you will need to take out a bank loan. While people, typically, would resort to Fannie Mae for financing, the team actually used a DSCR loan, a mortgage loan for residential income-producing property which is primarily based on “debt service coverage ratio “ or the cash flow of the property, rather than the borrower’s income and/or credit score. Formally put, “these loans are mortgage loans secured by residential real estate turnkey properties strictly used for a business purpose and underwritten primarily based on the property (Easy Street Cap).” Luckily, this building already had a healthy DSCR. For that reason, the bank was able to project income high enough to allow the team to obtain the loan. A bonus win for the team: the active real estate portfolios of team members, Isreal and Sam, made a suitable case for the bank to feel confident in providing the team with the loan. Nestment was also an asset in this process. How?

When buying mixed-use property (both residential and commercial), it is extremely difficult to find financing and hard to underwrite. You see this even in NYC with all of the vacant buildings and storefronts. Nestment was able to serve as a corporate sponsor advocating for Kọ Cafe in this process, confirming that they are the right team to trust in purchasing this property. This helped the Kọ Cafe team avoid putting more money down as well as avoiding higher closing costs that massive buildings typically pay for. Additional fees to be mindful of: attorney fees, broker fees and appraisal fees.

There are many more fine details that go into the process of purchasing real estate. Interested in learning more? Check out Ko Cafe’s Real Estate Live Podcasting and Networking Event in conjunction with Nestment. This event takes place Wednesday, February 28th at 6:30pm EST. 

Learn more about the team, below. 

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Isreal Adeyanju is the Lead Founder and CEO of Kọ Cafe. He also leads diversity initiatives at Nestment. Isreal is a social impact steward and civic technologist with an itch for taking disruptive ideas from 0 to 1. He’s passionate about building smart cities where constituents are informed and engaged, have access to affordable housing, and have equitable opportunities for social mobility.

Sam Osei Afriyie is the Co-Founder at Kọ Cafe, leading partnerships and events. Outside of Kọ Cafe, he is an enterprise technology consultant at Nvidia with expertise in artificial intelligence policy, digital transformation, and cloud infrastructure. He is passionate about assisting early Black and Brown people with transitioning into technology careers and building community.

Olubanwo Aruleba is the Co-Founder at Kọ Cafe, also leading partnerships and events. Outside of Kọ Cafe, he is a career strategist and tech recruiter with a passion for preparing professionals for the future of work. He’s worked as a tech recruiter in matching some of the most talented and overlooked minds to some of the leading technology brands and disruptive start-ups. 

‍Victor “ Vick ” Adeyanju is the Co-Founder of Kọ Cafe, spearheading multimedia production and customer experience initiatives, ensuring a seamless blend of innovation and satisfaction. Vick is a visionary creative strategist and consultant dedicated to empowering small businesses and aspiring entrepreneurs to overcome obstacles and achieve tangible results. Outside of Kọ, Vick serves as the Managing Director of ResourceXpertise, leveraging his five years of entrepreneurship to guide others away from common pitfalls and time-consuming mistakes. He is also the Founder of Cut Different TV, where he utilizes his extensive background in multimedia production to curate and share the compelling stories of artists from diverse backgrounds.

Daniel Adeyanju is the Co-Founder of Kọ Cafe, focusing on relationship development. He is passionate about creating pathways to economic mobility through technology education. He also serves as the Director of Partnerships and External Affairs at The Knowledge House, a tech training nonprofit connecting underestimated communities to family sustaining tech careers. Daniel focuses on building relationships with companies that hire and inspire their Fellows, and fund their programs. Prior to TKH, he was Founding Program Director at Kura Labs. In prior career journeys, Daniel has been a software engineer at a Fortune-500 corporation, startup operator, and technical career coach for Computer Science majors at CUNY Lehman College, The Bronx’s only 4-year CUNY institution.