On Tuesday, Jonathan Rose Cos. acquired Barbara Jean Wright Court Apartments, a perplexing 272 affordable apartment complex sandwiched between the University of Illinois at Chicago and the Pilsen area, for $ 17.5 million from Chicago Community Development Corp., developer Anthony Fusco. It is the latest in a series of purchases made by a New York-based investor, now a key player in Chicago’s affordable residential community.

It took years to negotiate the final agreement, which required funding and approval from several government agencies. But once funding has finally been secured, patient residents hope the new owner can deal with the rodent plague and many other maintenance issues plaguing the estate.

“We’ve gone through hell and back with this property,” said Jessie Johnson, head of the Barbara Jean Wright tenant council and resident since it opened in 1972.

Fusco could not be commented on, but the 73-year-old had previously said he wanted to retire and Rose was better able to refinance the property.

Jonathan Rose Cos. presented itself to residents and government officials as a domestic firm with deep pockets, capable of sustaining and maintaining affordable condominiums for many years. And while Rose’s partner and senior managing director, Nathan Taft, said the company’s growing presence in Chicago would not change the city’s affordable housing portfolio, it would provide better and healthier lives for the few estates that she currently owns.

“What we can do with these individual properties appears and has a significant impact,” he said. “What we have tried to do is our role to raise these assets and make them safe, stable places to live for people.”

Barbara Jean Wright was one of many inexpensive private complexes throughout the United States, originally financed in the 1970s with loans from the Department of Housing and Urban Development. But the agency has stopped making such loans, making it difficult for landlords to recapitalize the property and keep it affordable after original contracts have expired.

Fusco saved development from foreclosure when it bought an 11.5 acre plot of land in 1999, and residents had high hopes to keep its two- and four-story structures. His CCDC acquired at the same time several low-cost South Side housing estates that eventually included Archer Courts in Chinatown and Englewood Gardens, a scattered Section 8 portfolio in the Englewood neighborhood. But Johnson and other residents said the past few decades have been a disappointment, marked by a steady deterioration in housing conditions.

“Once upon a time (Fusco) was seen as this affordable housing star and it may have been, but sometimes the road to hell is paved with good intentions,” Johnson said.

Fusco did some renovation work in those early years, but the effort stopped, she added. “He handed over the property to the dogs. They haven’t been doing anything here for years.

Johnson added that rats eventually gnawed holes in the walls of many apartments, black mold was also spreading, and attempts to tackle other problems such as broken sidewalks were often just patchwork.

According to Brandon Kearse, managing director of Jonathan Rose Cos, over the past few decades the rental income has not been sufficient to sustain it, but this new deal finally puts Barbara Jean Wright on a solid financial footing.

“This should prepare development for great success in the long run,” he said.

Rose has been on a budget-buying frenzy over the past year, especially in the South Side. In February, he purchased Fusco’s 146-unit Archer Courts for $ 11.6 million, and in July, he and his partner 5T Management paid $ 10.7 million for the 13-building Fusco’s Englewood Gardens. In August, Rose joined the nationwide nonprofit Preservation of Affordable Housing to purchase the $ 25 million Jackson Park Terrace, a 15-story skyscraper and several adjoining homes near the Obama Presidential Center in Woodlawn, from Rev. Leon Finney Jr. Woodlawn Community Development Corp., which filed for bankruptcy in 2018.

Rose has acquired Archer Courts, Englewood Gardens and Jackson Park Terrace with the $ 525 million Rose Affordable Housing Preservation Fund V and has renovation plans for all three. The company currently has approximately 18,000 units nationwide and more than 2,000 in the Chicago area.

The company took a different route to finance the purchase of Barbara Jean Wright. He paid Fusco $ 1, took over its $ 17.5 million of residual real estate debt, and will start a $ 46 million renovation funded by a Federal Housing Administration loan, federal tax credit, funds to finance city tax increments, and state tax credits, including . other sources. Under the new deal, rental assistance from both HUD and the Chicago Housing Authority will make most housing affordable to people earning 60% or less of the median income in the area, with 21 units at market level.

Rose did not have to use all of these agencies to buy Archer Courts, Englewood Gardens, Jackson Park Terrace or other Chicago properties as they only require relatively light renovations while Barbara Jean Wright needs a complete makeover, inside and out, according to Taft .

“In this case, Barbara Jean Wright needed it,” he said.

The company has promised to provide new security gates, fences, new kitchens, bathrooms, floors, carpets and lighting, as well as a 5,000 square foot cultural center and a refurbished basketball court and playground, says Karyntha Walsh, senior project manager.


“There is also a significant amount of deferred maintenance that we will take care of,” she said.

The tenants council is also negotiating an agreement with Rose about how the company will manage the community, according to Sam Douglas, the board’s vice president. He said the council wanted to establish and help administer recreational and educational programs for neighborhood children and seniors.

“We want to get involved when Rose comes in and write it down because we suffered when things weren’t written,” he said.

Walsh said the parties have been talking for 18 months and are almost ready to sign an agreement where many of the development changes are driven by residents’ suggestions, including a new community center and better security measures.

“We’re in the final draft,” she said. “They were with us step by step.”

A. Robert DeBonnett, a local resident and a tenants council volunteer, said he hoped the new owner would end decades of neglect. That said, Barbara Jean Wright should be a gem, especially as she is surrounded by so many key institutions and landmarks, including the university, St. Ignatius College Prep and the historic South Water Market, now an apartment building with 917 units called University Commons.

“Barbara Jean Wright can be an exemplary community to set an example,” he said.

#York #investor #buys #inexpensive #South #Side #development

Source link

Leave a Reply

Your email address will not be published.