Tighten property deals, city told Ambridge urges tougher ,, procedures for land transactions

June 27, 1996|By Marilyn McCraven | Marilyn McCraven,SUN STAFF

Charging that city officials spent about $250,000 to obtain and raze four dilapidated West Baltimore houses that it could have gotten for far less, Anthony J. Ambridge yesterday urged the city to adopt more stringent procedures for handling real estate transactions.

Ambridge, the city's recently appointed real estate officer, asked the Board of Estimates to require that each property bought or sold by the city be appraised to determine the fair market value and that statements explaining and justifying such transactions be provided.

At Mayor Kurt L. Schmoke's request, the board agreed to delay a vote on the proposal until July 10.

That proposal was the latest effort by Ambridge and his boss, Comptroller Joan Pratt, to increase their oversight of city real estate transactions, many of which they say are not being handled effectively by the city.

"We could have put liens on these properties. We could have taken the owner to housing court. Why are we spending a TC quarter-million dollars?" Ambridge said.

In an interview, Ambridge cited several examples of what he called an apparent waste of city funds in real estate deals, including $290,000 in back rent owed to the city by the Park Heights Development Corp., which runs small business incubator programs.

The city obtained an eviction order against the group in court last week, but the group has appealed, said Morris Iles, the group's director.

Iles said his group is obligated to pay rent at 2901 Druid Park Drive on "50 percent of any net cash flow."

Iles said there is no net cash flow, so no rent is owed.

Ambridge particularly criticized the deal involving the four long-vacant West Baltimore houses in the 3200 block of Powhatan Ave. in the Hanlon Park neighborhood, facing Lake Ashburton.

Because of objections raised by Ambridge, the Board of Estimates tabled a request that the now-vacant lots where the houses had stood be sold to a developer for a total of $9,000.

In an interview, city Housing Commissioner Daniel P. Henson III, whose agency handled the deal, defended it as "the most efficient way to get the properties back in the hands of homeowners." Henson said the property owner's determination to drive a hard bargain made the deal "an aberration."

Henson said previous city attempts to get the houses, including taking owner Christine M. Webster to housing court, had been unsuccessful.

The owner wanted a prohibitively high price of $242,000 and had vowed to wage a prolonged fight against the city, he said.

Ms. Webster could not be reached for comment.

Subsequently, the Baltimore Corporation for Housing Partnerships, a nonprofit developer, entered into a contract to buy the properties for $140,000 from Ms. Webster.

BCHP's interest in the Powhatan Avenue properties flagged as larger, more pressing projects demanded attention, Henson said.

"They asked the city to step in and take their place," Henson said.

So, a year ago, the city bought the properties for $140,000 and paid BCHP $80,000 for "pre-development work," Henson said.

"The city felt obligated to cover the design costs, legal costs" that BCHP, a one-time quasi-city agency, had incurred, Henson said.

The city didn't have the property appraised because of the nature of the transaction, Henson said.

Calls to BCHP were not returned.

Henson said he had no figures on the cost of demolition work, which was awarded through the required bidding process. Ambridge estimated the demolition cost at $30,000, for a total of at least $250,000 spent on the project.

Ambridge said records show the city paid $9,500 just to have each foundation dug up.

"That's three times the market rate" for such work, said Ambridge, a licensed real estate appraiser.

As for the comptroller's request for an appraisal and a written explanation for each city real estate deal, Henson said he would have to study the proposal before commenting.

Last week, Ambridge requested that all city real estate transactions be conducted through the real estate office.

Schmoke, who controls three votes on the five-member Board of Estimates, rejected that idea but has promised to inform Ambridge before transactions come before the board.

When he took office two weeks ago, Ambridge promised Pratt that he would find ways to save the city $1 million in his first month in office.

Yesterday he said that would be a cinch.

"We're going to save more than $1 million," he said.

Pub Date: 6/27/96

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