Tuesday, September 18, 2007

Associated Estates Fire Sale

From the Files of "Things Must Really Be Bad..."

Cleveland is in the midst of record breaking foreclosures that are expected to only grow in the next year, the housing bubble is popping with real estate declining in value, and now today Associated Estates announced that they are divesting of every one of their affordable rental units in the United States. You may remember Associated Estates from such east side disasters as Longwood Estates in Cleveland that had become so bad the U.S. government demanded the property be torn down. Associated stepped aside after a long series of articles in the Plain Dealer, and the property was rebuilt as Arbor Park. Associated Estates was at one time one of HUD's biggest landlords in the United States.

I do not know what this says about the U.S. economy that this corporation is rejecting the federally backed money of subsidized housing. Is it an isolated incident with a long troubled company? Is it too much government oversight that corporations find it hard now that they are expected to keep their property up to housing quality standards? Is it that fair market values are falling in many communities so that corporations are not seeing a high enough return on their investment? It is a solid source of money with the government paying up to 100% of a household's rent in some of these buildings. How bad must the future be for housing if companies are abandoning the subsidized market? These private corporations providing housing subsidized by the government go back to the Nixon/Ford administrations. You remember the olden days...when the U.S. government actually felt it important to have a plan to house its citizens, and before large scale family shelters were part of the American landscape.

From the Cleveland Tenants Organization here are the local properties operated by Associated Estates:

Cleveland:
Abington Arms 152 units
Alexia Manor 50 units
Euclid Beach Club 252 units
Euclid Beach Villa 559 units
Lakeshore Village 108 units
Lourexis 70 units
Owl's Nest 260 units
Riverpark 100 units
The Triangle 142 units

East Cleveland
Forrest Hills Terrace 420 units

Shaker Hts
Ohio Shaker Club 4 units
The Statesman 47 units

Mayfield Hts.
Gates Mills Villa 191 units

University Hts.
Cedar Center 47 units

Warrensville Hts.
Shaker Park Gardens 151 units

Westlake
West Chester Townhomes 143 units

Euclid
Euclid Hill Villa 505 units

1,693 units in Cleveland and 3,201 units in the area.

I hope that there are enough buyers in the system who can handle all these properties. It would be a disaster for these units to disappear, and it is hard to be a landlord.

Brian
Posts by Northeast Ohio Coalition for the Homeless staff and Board.

1 comment:

Cynthia D. Miller said...

Nine months ago I inquired about Westwood Place in Strongsville, one of four properties in the greater Cleveland area owned by Owner's Management Company.

I thought that Westwood Place would not only be an ideal place to live because of its convenient location, but my mother had lived there for six years so I had familiarity with all aspects of living there.

No longer does this building provide subsidized housing for its senior and disabled population.

Prior to her move to Westwood Place, my mother lived at Owl's Nest in Cleveland Heights. Most of the residents there (seniors)are non-English speaking and the Owl's Nest also accepts subsidized rent monies.

Both buildings are beautiful properties that are well cared for and safe buildings for the residents.

I hope to buy a property once my social security back pay and regular checks start coming and, hopefully I can get help under HUDs first time home ownership program.

Sadly, the property I am interested in is in my hometown in depressed Jefferson County in the Ohio Valley.

Homes are moving very slowly down there and the only option available to prospective homeowners is to pay cash due to rejection of loan applications. The seller is taking a significant loss as a result. Reducing the cost of the property by half, accepting a cash payment in hand is no different than the 50 cents on the dollar worth that people had to accept on their savings during the Great Depression.

The bureaucratic red tape and the paperwork requirements are enough to turn off any landlord or property owner from accepting any government subsidy.

I find it doubtful that the residents of any building receiving subsidies will receive adequate notice or even know how to advocate for themselves to retain affordable housing.

Meet the new homeless!