Washington, D.C. – September 5, 2008 – (RealEstateRama) — Senators Charles E. Schumer and Hillary Rodham Clinton today welcomed an announcement by the Department of Housing and Urban Development (HUD) that the agency has released a new bid package to address the sale of the ElJay apartments located in Syracuse, NY.
Throughout the auction process, the main concern of the City and that of Senators Schumer and Clinton has been that HUD has been eager to sell the apartments without ensuring that potential bidders are responsible developers with the ability and track record to ensure that the ElJay apartments become a resource rather than a burden to the Syracuse community. Based on discussions taking place over the past months, HUD and the City have come to a mutual agreement concerning who will be eligible to bid at the foreclosure sale and how the properties will be repaired/redeveloped and maintained after the sale, helping to ensure that the units will be a source of safe and affordable housing for the community.
“I am pleased that we were able to work through disagreements between HUD and the City to forge a fair solution that will preserve vital affordable housing in Syracuse,” Schumer said. “The City of Syracuse has worked hard to craft a bid package and set the table for a responsible buyer to purchase these properties. Anyone who bids on these properties now will make sure these buildings are a resource and not a burden on the community. I am thrilled that we are now able take the next step in turning these buildings into much-needed safe, affordable housing in the City.”
“This announcement is welcome news for the City of Syracuse and a victory for a community that has worked hard to revitalize their housing market. Since day-one, I have worked with my colleagues to help ensure that we put a transparent bidding process in place that ensures potential owners are chosen based on their plans to care for, and preserve the long term affordability of the properties,” said Senator Clinton. “With the cooperation of HUD working to address Mayor Driscoll’s concerns, we are now taking key steps to see that the apartments become a resource for the community, and a source of safe and affordable housing for the future tenants.”
According to HUD, the general terms of the foreclosure sale will mandate that only established nonprofit housing corporations having a mission of preserving affordable housing will be permitted to bid, and the high bidder will be reviewed to determine if it has an acceptable track record with HUD. Any other properties that the bidder owns must meet State and local codes and the bidder must have previous successful experience in managing affordable housing. Additionally, the purchaser may either redevelop the entire project as purchased at the sale or may sell a portion of the property to another developer. Either the original purchaser or the subsequent purchaser must repair and redevelop the properties within 24 months from the date of the foreclosure sale closing. The project will be advertised on September 3 and the foreclosure sale (bidding) will be held on December 3, 2008. For full details regarding HUD’s new bid package for the ElJay apartments, please visit: http://www.hud.gov/offices/hsg/mfh/pd/elja/eljabkit.pdf
Upon being alerted to HUD’s plans to auction the nine apartment buildings in Syracuse earlier this year, Senators Schumer and Clinton immediately took steps to work with Syracuse Mayor Matt Driscoll to advocate the City’s position that the next owners should be chosen based on their plans for these units’ maintenance and long-term affordability. In April, the Senators joined to push HUD to extend the auction date for an additional six months, to allow the necessary time City to continue their work of finding a developer capable of rehabilitating the building, and to address major concerns that HUD set a sale price that did not take into account the high cost of renovating the units (http://clinton.senate.gov/news/statements/details.cfm?id=295884&&). The lawmakers later blasted HUD following the agency’s decision to prematurely move ahead with the auction (http://clinton.senate.gov/news/statements/details.cfm?id=296270&&), which failed to attract a single bidder.
