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Owners cry foul over city plan  to level crime-ridden buildings

Mary Woodards Austcommunity 105 N. Pine Thursday September 6 2012. l John H. White~Sun-Times

Mary Woodards in the Austin community at 105 N. Pine, Thursday, September 6, 2012. l John H. White~Sun-Times

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Updated: October 11, 2012 6:07AM

In a crime-ridden stretch in South Austin, the City of Chicago is using a bulldozer to combat gang and drug-related activity.

The city is turning to public nuisance laws to potentially demolish a square block that once contained 13 troubled row houses, stretching from Pine to Lotus and from Washington to West End.

Five six-unit buildings on Lotus have already been knocked down, and the city is trying to level eight others on Pine.

Despite owing thousands of dollars on mortgages, owners of the properties are being offered $3,300 per unit and tenants are being given $1,500 to move out.

“We are being coerced into accepting the settlement,” said Mary Woodards, who owns several units on Pine. “They made us fearful if we don’t accept the settlement, we could be liable for millions in fines and court costs and they still are going to tear down the buildings.”

It took the city’s agent, Community Initiatives Inc., an affiliate of Community Investment Corporation (CIC), two years of arm-twisting before the city could legally tear down the Lotus buildings.

Now, the city has targeted the remaining eight row houses on Pine. Three row houses have eight apartments in each building. Five row houses have 10 apartments. A ninth row house was leveled last year after it suffered fire damage.

Most of the owners are landlords who invested their life savings into fixing up the buildings then renting to low-income renters to pay the mortgages.

“I didn’t know the city would use these kind of tactics,” said Robert Sykes, who stands to lose four apartments in the 111 N. Pine building if the city prevails.

“I’ve been dealing in real estate for quite a while and I know this is some valuable land over here. To use these tactics is really a slap in the face.”

After hearing evidence from police officers, owners, renters and neighbors, Cook County Judge James M. McGing, will decide whether or not the buildings can be demolished as a public nuisance.

“The city gave the owners time to cure issues at the buildings,” said Roderick Drew, a spokesman for the city’s law department.

“They walked them through the steps that they needed to take to do it and there was just no progress being made toward curing any of the problems,” he said.

Drew said the city’s offer of $3,300 per unit (some of the units are 3-bedrooms, 1 ½ baths) was based on appraisals and what it would take to make necessary repairs.

A “Financial Operating & Pricing Analysis” prepared for CIC by “Apartment Investment Advisers” determined the fair market value of the Lotus town homes at $2,500 per unit but noted several active listings for units that range from $4,000-$10,000.

“Unless there is a unified and cohesive effort between the owners to revitalize the buildings and immediate area, the subject property will continue to breed criminal activity in the form of vandalism, drug trade and prostitution and continue to be a blight to the immediate area and the Austin neighborhood,” the report concluded.

Frantic renters in the Pine town homes said the city’s representatives told them they have 30 days to move even though the case is still in court. The city’s lawyers have denied that claim.

But owners argue that the city’s goal was to tear down the buildings, not save them.

“We put thousands of dollars into the properties so the city would leave us alone,” said Woodards, who once owned 11 rental units.

“Then seven months later they would write more violations. Some owners walked away after they had spent big money. Then scavengers would come and take out the kitchens, bathrooms and plumbing. After they had ravaged them, drug dealers would come in and take over,” she said.

From the city’s perspective, the people living between Lotus and Pine became a “resource drain” on city resources.

Community Initiatives Inc. served as both the receiver for the Lotus properties and as the city’s agent, disbursing settlement and relocation fees.

“These were very troubled buildings, said Jack Markowski, executive director of CIC, who was the housing commissioner under former Mayor Richard Daley.

“You had the city’s housing department, building department and police department determine the buildings were in very bad condition. It became a center for crime.”

Ald. Jason Ervin (28th) said he urged the owners to form an association to undertake repairs and hire private security.

“I empathize with the individuals that are there. Some people are going to be left holding the bag between CIC and the city of Chicago, getting the mortgages off their plate and trying to remove the debt off them,” he said.

An attorney representing several owners argues that the city’s strategy penalizes owners who are victims of crime themselves.

“We got involved because the owners are being bullied,” said Lisa Gaspero of Gaspero & Gaspero, Attorneys at Law, P.C.

“Building owners desperately want to keep their property. They are law-abiding citizens. Frankly, they are just as disturbed about the situation as anybody and wish the city would find a constructive solution to reduce the crime other than tearing down their homes,” she said.

“I think what they are trying to do is eminent domain, but under eminent domain they have to pay a fair-market value for the property,” she said.

Woodards said she still owes a $65,000 debt on the 125 N. Pine properties and the city is offering to pay a total of $13,200 for the four units.

“I invested all my monies I made as a nurse in these properties,” she said. “When they take these properties, they are taking away my pension and what I would leave for my children and grandchildren.

Sykes is in the same boat.

He paid $150,00 for four units and spent $70,000 to rehab the apartments, he said.

“The city is offering me $3,300 per unit, and whatever the difference is, I am going to have to settle with the bank,” Sykes said.

“You leave me with a $140,000 mortgage and I’ve got nothing to show for it. I am retired. I don’t have that kind of money. I have invested quite a bit of blood and sweat and some tears in this property,” he said. “The city is paying peanuts on the dollar.”

Owners don’t disagree that criminal activity is pervasive but say it is unreasonable to expect landlords to battle drug dealers and gang-bangers.

For instance, last Thursday, Woodards was showing me some of the units she owns when she was confronted by a group of menacing males about removing a memorial of teddy bears and empty Hennessey and Grey Goose bottles.

The street memorial marked the last steps of 18-year-old Alonzo Powell, who was killed during one of the deadliest Saturday nights of the summer.

Powell was shot in the head in the hallway of 121 N. Pine on Aug. 18. That same night, two other teens were shot on the same block.

Woodards didn’t flinch when one of the young men got in her face, saying she was “too old to disrespect people on the street.”

“This is my property,” she told me. “I can’t let them run me away.”

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