Today we hear of another case involving a subsidized housing complex in the Western Addition that's over 30 years old and that suddenly finds itself in an awkward, legally tricky predicament regarding its ownership and management. The El Bethel Arms, as the Chronicle reports, is a 33-year-old, 225-unit senior housing property in the Fillmore that was built to house parishioners of the nearby El Bethel Missionary Baptist Church. In a case that sounds oddly similar to one settled out of court in February involving another church-built, low-income housing complex in the neighborhood, Frederick Douglas Haynes Gardens, the board of the El Bethel is now suing its property management company, Christian Church Homes, claiming that they were hoodwinked into signing an agreement that will potentially give that company tens of millions of dollars in federal tax credit money.
As the Chronicle reports, Christian Church Homes is a nationwide non-profit outfit that manages 54 properties, and has been managing the El Bethel Arms since 1990.
The current dispute is over an agreement signed by the El Bethel Missionary Baptist Church's board in 2013 that created a limited liability corporation of which Christian Church Homes owns 49 percent, which was done in order to rehab the housing complex and receive low-income housing tax credits. Some board members now say they didn't realize they were signing away 99 percent of those tax credits and there's some question about whether a quorum of the board was even present at the signing. Christian Church Homes denies any shady dealings, and points out that they themselves are a non-profit, but the SF church now fears that they could end up losing ownership of the entire complex or some part of it to a for-profit developer, given how much the property may now be worth.
Former city attorney Louise Renne said back in February that as many of these aging housing complexes are reaching the point of having their 30-year mortgages fully paid, we are likely to see more legal wranglings that are the result of real estate pressures.
Earlier this year we also heard about the rent strike happening at another Western Addition complex, the 139-unit Midtown Park Apartments at Divisadero and Geary, which also has a complicated ownership situation because it was originally owned and built by the city itself, with a view toward handing ownership over to the tenants. Now it's controlled by Mercy Housing, and tenants have complained of having their rents raised as much as 300 percent.