The Diocese of Toledo has an interested buyer for its seven low-income housing properties up for sale, but some area leaders worry the California-based real estate investment company might not be the best entity to take over the residences.
Exterior view of the Michaelmas Manor on Schneider Road in Toledo.
BLVD Capital has proposed to buy Doves Manor, Madonna Homes, Michaelmas Manor, Moody Manor, the Plaza, and Regina Manor in Toledo, as well as Delaware Acres in Fremont, according to Ohio Housing Finance Agency documents obtained by The Blade. The agency administers the federal low-income housing program in Ohio and is required to be notified of any owner or management change for housing that receives tax credits.
Diocese spokesman Kelly Donaghy said Friday she could not confirm the company’s interest in the properties and said the diocese is not under any contract with a potential buyer.
Ohio Housing Finance Agency documents indicate that six organizations submitted letters of intent to consider buying the properties.
“We continue negotiations and discussions with potential buyers, but it would be premature and unprofessional to speak about specifics yet,” Ms. Donaghy said.
The affordable housing complexes are owned by Mareda Inc., a nonprofit corporation formed by Bishop John Donovan in 1977. Last year Bishop Daniel Thomas announced his plan to sell the properties after an ongoing review of the diocese that began in 2015.
“We continue to perform our due diligence regarding any potential buyers, with a view to finding a buyer who understands our ethos, our care for people, and who would be committed to providing that same kind of care,” Ms. Donaghy said.
Leaders from Local Initiatives Support Corporation, Lucas County Land Bank, and the city of Toledo’s neighborhoods department last week sent letters to Ohio Housing Finance Agency officials expressing reservations about BLVD Capital potentially assuming ownership of the properties, which total 842 units.
The California-based company already owns low-income properties in Cincinnati, Fairborn, and Milford and has been cited for code violations that include non-working boiler systems, water leaks, mold, and vermin infestation at some of those units, according to a June 6 document from the Ohio Housing Finance Agency. The document includes information from the city of Cincinnati’s law department that shows BLVD Capital had not corrected the violations at the Pendleton Apartments there in a timely manner.
Soon after the firm purchased Pendleton Apartments in 2014, the Legal Aid Society of Southwest Ohio, LLC began receiving “an increasing number of tenant complaints for not making repairs,” the document also states.
LISC Executive Director Kim Cutcher questioned BLVD Capital’s ability to responsibly manage affordable housing in a June 13 letter.
“The information from legal aid organization and local jurisdictions in Ohio causes great concern for the preservation of the affordable housing assets and most importantly the condition of the housing for low and moderate income tenants,” she wrote.
Veronica Burkhardt, Toledo’s housing commissioner, outlined similar concerns in her June 13 letter to the agency.
“The ultimate goal is to ensure that the portfolio of projects is transferred to a responsible and responsive entity. I don’t see that happening if this sale is allowed to transpire,” she wrote. “I have grave concerns as to what will happen to the tenants … Based on the information from other communities, these tenants would be immediately placed at risk for unsafe housing.”
Her letter also indicates one or two of the other organizations that expressed interest in purchasing the housing already have local investments and are “long-standing partners.”
“Although other bids were submitted, they were not given consideration,” she wrote. “Willingness to pay the most should not be the only factor. A vested interest that promotes affordable, decent, and safe housing for the most vulnerable populations is key.”
Molly Moses, spokesman for Ohio Housing Finance Agency, said the properties must be maintained as affordable housing if they change hands. While the agency must be notified of an ownership change, in this case it isn’t required to give approval before the sale, she added.
Mrs. Moses said the agency is evaluating BLVD Capital and will recommend either approval or disapproval, likely by the end of the month.
“If the sale does proceed without our recommendation, the entity could be placed on a not-in-good-partnership list,” she said. “If they are on that list they could be ineligible to receive funding in future tax credit rounds.”
The properties also receive housing assistance funds from the U.S. Department of Housing and Urban Development, so the federal agency also will weigh in before a sale is final.
Pamela Ashby, director of HUD’s Cleveland field office, said the agency hasn’t received an application of an ownership change for those properties.
“We’re aware there have been some groups that have brought some concerns, but until we have a formal application, we can’t speak to that,” she said.
In his letter to the Ohio Housing Finance Agency, Land Bank President David Mann said he did not dispute the diocese’s ability to sell its properties for “the best possible price,” but he hopes the buyer is one that will continue to foster revitalization in Toledo’s neighborhoods.
“BLVD, Inc. and its affiliates have demonstrated an ongoing disregard for the safety, health, and well-being of the tenants of these projects,” he wrote. “BLVD, Inc. has also showcased an unwillingness to ensure that local concerns are addressed in a manner that will support neighborhood investment and not just drive residents and investment away.”