HomeMy WebLinkAboutHDC2006-022 News Paper Article For Foreclosure Hlted For LR Apartment. 08/04/2009Foreclosure halted for LR apartments Pagel of 2
Publication: Arkansas Democrat -Gazette; Date:2009 Aug 04; Section: Arkansas; Page ico
Number: 7 AdiyePaoer-
Foreclosure halted for LR apartments
Eastside Lofts granted second chance
BY JOHN LYNCH ARKANSAS DEMOCRAT -GAZETTE
A Little Rock apartment complex financed with state funds to preserve low-income housing in
downtown has a new lease on life after staving off foreclosure with "a lot of help from a lot of
people and a lot of hard work," said the head of The Arc Arkansas, which manages the
property.
Court records show Bank of America dropped its 4-monthold foreclosure effort against the
partnership that financed the Eastside Loft Apartments at Scott and East 14th streets last week.
The partnership has paid the three $8,937 monthly mortgage payments that Arc had fallen
behind on, plus put up another three months of payments in an escrow account, said Steve Hitt
with The Arc, a United Way agency that helps disabled people find housing.
He said the settlement was arranged by Arc's development partner in The Eastside High
School Limited Partnership, Apollo Housing Capital LLC, a national firm that sells and manages
portfolios of low-income housing tax credits for investors.
"There was just not enough income to stretch," Hitt said, explaining how the agency got
behind in the mortgage payments.
Hitt said he doesn't foresee The Arc falling behind again. He said the 41-unit apartment
building was at 98 percent occupancy on Monday.
Bank of America petitioned in Pulaski County Circuit Court to foreclose on the apartments in
March, reporting that the Arc hadn't paid the mortgage since August. The bank sought to
recover the more than $1.2 million it said was owed on the original $2.5 million note, plus
penalties and interest.
The state issued more than $2.6 million in state tax credits — provided in annual installments
for a 10-year period — and about $930,000 in historic preservation tax credits to the Eastside
High School Limited Partnership. The tax credits were sold to raise the money needed for the
roughly $3 million renovation of the 65,000-square-foot East Side Junior High School, which
was built in 1904. The city of Little Rock also lent the project $100,000 using federal grant
money.
In exchange, 32 of the 41 apartments in the Eastside Lofts are set aside for low-income
tenants — or those earning less than 60 percent of the median gross household income in
Pulaski County, which is $57,900, according to the federal Department of Housing and Urban
Development.
A similar project to provide low-income downtown housing was foreclosed on last year. Block
2 Lofts, a collection of three historic buildings bounded by East Markham, Scott, East Second
and Main streets and containing 145 apartments and nine commercial spaces, were taken over
by LSF5 Block 2 LLC, which bought a defaulted loan on several properties on the same block
last year and foreclosed in March 2008.
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Foreclosure halted for LR apartments
Page 2 of 2
Arkansas Democrat-Gazette/KAREN E. SEGRAVE Foreclosure proceedings on Eastside Loft
Apartments, low-income apartments on Scott Street, have been dismissed in Pulaski County Circuit Court.
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