Preserving affordability

When Faith McGhee moved to Grove Parc in 1991, the federally subsidized building provided her with stability when she needed it the most. “It really helped me to put my life back together when I was between jobs because I wasn’t able to afford market rent,” said McGhee, who was separated from her husband and had three children. “It’s a place rich in resources.”

But, by late 2007, the condition at the Woodlawn building had turned 180 degrees. After years of mismanagement, Grove Parc had deteriorated to the point where it failed the U.S. Department of Housing and Urban Development’s inspections twice in a year, scoring as low as 11 on a scale of 100—49 points below passing. As a result, the building was slated for foreclosure.

“I kind of felt like [the management was] allowing the property to go downhill. Housing all across the board was going downhill,” McGhee said.

That’s when Preservation of Affordable Housing stepped in to salvage the building. The Boston-based nonprofit is known across the country for its success rate in taking subsidized buildings in disarray and transforming them—while preserving the affordability of the units.

When the nonprofit’s management team, Preservation Housing Management, assumed management of the building in January 2008, it began making urgent repairs to the building to bring it up to HUD’s standards. Because the inspection scores had been so low, it was a monumental task to improve conditions and pass inspection, but the management team had the support of residents, said Karen Rhodes, Preservation Housing Management’s senior property manager. “The residents were cheering us on. They wanted to pass inspection as much as we did,” she said.

By November 2008, the nonprofit managed to raise the inspection score by 64 points.

Maria Plati, the nonprofit’s communications manager, said her organization’s work comes at a crucial time as the country faces a growing need to preserve affordable housing. According to HUD’s 2009 biannual report, only 32 units of affordable housing are available for every 100 very-low-income renters. “We have a specific mission to increase the number of affordable housing units across the country, given the fact that many were being lost to market-rate rent,” she said.

In 2001, the nonprofit began to counteract that loss by acquiring and redeveloping 14 affordable-unit properties in Missouri in a $22 million transaction that saved 915 units. Since then, it has rescued and refinanced 6,800 units in 54 developments in 10 different states, including the District of Columbia.

“We put together financing packages in a creative way so we can acquire and restore and manage these properties,” Plati said.

The acquisition of Grove Parc was the beginning of a multiyear project. The nonprofit managed to pass HUD inspection, but it ultimately determined that—since the condition at the building was so unstable—its demolition and rebuilding was the only option for a long-term preservation.

The move was met with some degree of skepticism by the rest of the Woodlawn community. “As with any community in change and transition, the surrounding community in Woodlawn has expressed a concern about our practice, in terms of us tearing down,” said Felicia Dawson, the nonprofit’s director of community affairs.

So the nonprofit made sure to find temporary housing for the 390 tenants and guaranteed their return once the building is rebuilt. All 504 affordable units will be preserved, and 210 of them will remain on-site, while the remaining 294 will be off-site in existing apartments that it will purchase and rehab.

In early November, two buildings holding a combined total of 67 units, 60 of which are affordable, were completed and ready for tenants to move back in.

McGhee was among the first Grove Parc residents to return to the building, renting a one-bedroom apartment in the new development on South Cottage Grove Avenue. “So far I don’t really have a complaint … although I’ve heard people say they weren’t comfortable because of some of the new rules,” she said, adding, “They’re willing to work with you. They are still working around some things in the building, but there are a lot of things that I have now that I didn’t have when I was in the building.”

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