SYRACUSE - The city of Syracuse on Monday asked the federal government for a three-week postponement of its scheduled auction of nine low-income apartment buildings.
The city had requested cancellation of Wednesday's auction but the U.S. Department of Housing and Urban Development said the city's only option was to purchase the properties itself for $9 million. HUD also estimated the city would need to spend at least $16 million to rehabilitate the buildings.
“Obviously, the city is not in the position to undertake a $25 million investment, a purchase that is not economically viable in this real estate market,” said Syracuse Mayor Matt Driscoll.
A delay in the auction would give the city time to “enlist wider private sector interest” in the properties, the mayor said.
The city objected to the auction, in which the buildings would go to the highest bidder, regardless of management history. City officials wanted HUD to establish a bidding process that would give the city a say in who buys the properties and how they are used.
Fernando Ortiz Jr., the city's community development commissioner said the city had good reason to ask for the cancellation.
“We have put so many local resources into addressing absentee landlords and less-than-honorable property owners in the city,” Ortiz said. “In an auction, we're not able to ascertain the ability of would-be owners to do right by the properties and the tenants.”
In a bidding process, potential buyers would have to explain their plans for the properties and offer the amount they would be willing to pay, Ortiz said. In a HUD auction, the city would have no way to check the buyer's plans or management history, he said.
The nine buildings contain 275 federally subsidized low-income apartments. They are scattered throughout the city.
HUD foreclosed on the buildings in September after they failed inspection three times over three years.
If HUD agrees to the request for a bidding process, the city might try to break up the nine-building package, Ortiz said.
“Obviously, the city is not in the position to undertake a $25 million investment, a purchase that is not economically viable in this real estate market,” said Syracuse Mayor Matt Driscoll.
A delay in the auction would give the city time to “enlist wider private sector interest” in the properties, the mayor said.
The city objected to the auction, in which the buildings would go to the highest bidder, regardless of management history. City officials wanted HUD to establish a bidding process that would give the city a say in who buys the properties and how they are used.
Fernando Ortiz Jr., the city's community development commissioner said the city had good reason to ask for the cancellation.
“We have put so many local resources into addressing absentee landlords and less-than-honorable property owners in the city,” Ortiz said. “In an auction, we're not able to ascertain the ability of would-be owners to do right by the properties and the tenants.”
In a bidding process, potential buyers would have to explain their plans for the properties and offer the amount they would be willing to pay, Ortiz said. In a HUD auction, the city would have no way to check the buyer's plans or management history, he said.
The nine buildings contain 275 federally subsidized low-income apartments. They are scattered throughout the city.
HUD foreclosed on the buildings in September after they failed inspection three times over three years.
If HUD agrees to the request for a bidding process, the city might try to break up the nine-building package, Ortiz said.
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