Case Study II

Case Study II:

Brittany Village Apartments

Location:
No. Units:
Low to Moderate:
Lender:

St. Joseph, Missouri
280
40%
Missouri Housing Development Commission ("MHDC")

Brittany Village Apartments was financed with a HUD guaranteed loan. The loan was purchased by MHDC in a pool of non performing loans. MHDC contacted Charter Realty Group (CRG) to manage this project. A principle of CRG through negotiations with MHDC was replaced as the substituted general partner. CRG assumed management of this property in June 1997. The property was under performing, loan payments had not been made in some time, delinquency was extremely high, and the physical occupancy was at 80%. Several million dollars were required to cure the physical problems. The new general partner and MHDC each contributed capital for the rehabilitation program.

CRG first evaluated the resident profile, by interviewing residents, visiting every apartment and reviewing resident files. Delinquency notices and notices to vacate were distributed to residents. A new rent schedule was established pursuant to the guidelines established by the St. Joseph Housing Authority and MHDC. All residents that were on month to month leases were converted to annual leases. Today, the property enjoys consistently 97%-99% occupancy.

MHDC and the new general partner agreed on a rehabilitation plan totaling some $1.5 million. The plan required three years to complete. CRG managed all aspects of the rehabilitation, including identifying the problem areas, defining the scope of work, approving the final bids, and supervising all construction phases.

The renovation plan included: Replacement of all roofs, replacement of all single paned windows with thermal double insulated windows, replacement of all exterior doors, extensive exterior lighting additions, water heater replacements, sidewalk repairs, extensive iron rails replacements, upgrade of a common laundry room, asphalt repairs and slurry seal, additional landscape improvements, playground enhancements, and barbecue area addition.

Brittany Village Apartments is operating at a high occupancy level. MHDC is very pleased with our progress. The success CRG has achieved in a short period of time, is another example of its ability to manage a difficult situation in a somewhat remote location. This case study is somewhat abbreviated in the description of the many issues CRG had undertaken during the first year of management.

With the success of Brittany Village, MHDC approved CRG to manage another property in Springfield, Missouri.