Tenants, owner of apartments settle dispute over eviction

Low-income building to be razed

residents will get relocation aid

May 17, 2004|By Eric Siegel | Eric Siegel,SUN STAFF

Residents of a low-income apartment complex near Johns Hopkins Hospital in East Baltimore have settled legal action that sought to prevent their eviction. The agreement will allow the owner to proceed with plans to demolish the buildings and build in their place a new $80 million office, retail and residential development.

Under the terms of the settlement, the remaining 70 or so families of the Chapel NDP Apartments, who were originally told to leave their units between Dec. 31 and April 30, will have until the end of August to find new housing and will get up to $2,000 in relocation costs.

Dozens of other tenants who vacated their units after receiving eviction notices will receive $1,000.

A principal of the corporation that owns Chapel said he hoped to demolish the 17 buildings that make up the 173-unit apartment complex by the fall. He also outlined what he described as preliminary plans for office and retail space and 400 residential units in townhouses and a mid-rise apartment building with market-rate rents of up to $1,700 a month.

"That may change," said David Holmes of Capital Development LLC. "We're still in the concept stages."

Chapel residents said the settlement with Capital Development was preferable to the uncertainty of continuing to pursue litigation, even if it meant they would have to leave their homes and might not be able to find new housing in the area.

"What can you say?" said Dondrea Ross, chairwoman of Chapel NDP Community Association, who lives in the complex with her 12-year-old son. "Monetarily, it's pretty good."

"I just want to pack up and go right now," said Geraldine Pinkney, who has lived in the complex since it opened in the late 1970s.

The settlement was filed Friday in U.S. District Court in Baltimore. U.S. District Judge Richard D. Bennett must approve it.

The planned demolition and redevelopment of the Chapel site - which occupies a rectangle bordered by Orleans Street on the north, Washington Street on the east, East Baltimore Street on the south, and Wolfe Street on the west - is the latest sign of rebirth in the area.

A few blocks to the north, demolition has begun for a massive revitalization project centered around a biotech park; a couple of blocks to the west is the Broadway Overlook mixed-income development on the old Church Home Hospital site.

The site is on the border of the increasingly popular Washington Hill and Butchers Hill neighborhoods.

But the demolition of Chapel, where monthly rents range from $421 to $700 and many residents have federal subsidies, will exacerbate a shortage of affordable housing in the city. In court papers, lawyers for the Legal Aid Bureau and the Public Justice Center described Chapel as the "last all-low-and-moderate income housing located in the immediate area."

Chapel was built in the 1970s with the help of a low-interest, federally insured loan that required that the property be reserved for low- and moderate-income tenants during the 40-year term of the mortgage, according to court papers.

In December 2002, however, the previous owner of Chapel apartments, Apartment Investment and Management Co., prepaid the mortgage and sold the property to Holmes' Capital Development for $4.5 million. Three months later, Capital Development sent the first of several notices to residents, saying it would no longer accept rental subsidies for the property. The company at first said it was going to renovate the apartments and offer them as market-rate rentals, but later said it would demolish the buildings.

In January, lawyers for Legal Aid and the Public Justice Center, aided by the Homeless Persons Representation Project, took legal action against Capital Development, seeking to prevent the eviction of Chapel's residents, contending the eviction notices didn't comply with federal law and arguing that the complex should remain as housing for low- and moderate-income tenants.

The next month, Bennett issued an order forbidding Capital Development from evicting the residents until the case could be heard.

With Friday's settlement, Chapel residents "have achieved some certainty concerning their housing," said Gregory Countess, a Legal Aid lawyer.

Holmes said the settlement also frees up his company to assist the tenants to find new housing, adding that he expected half the families to find new quarters by the end of next month.

Holmes said he and his partner in the company, Christina J. King, own and manage several apartment buildings in North Baltimore. He said their proposal for the Chapel site would be the largest the two have undertaken.

"We have done smaller development projects but not on this scale," he said.

Capital Development has retained Gould Architects and STV Inc., an engineering and construction firm, to work on the plans, he said.

A zoning change would be needed to allow retail on the ground floor of the apartment building and the townhouses could be for sale or rent but no rental units would be subsidized, Holmes said.

Demolition would not begin before November because both the police and fire departments want to use the complex for training exercises after it is vacated, he said.

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