The U.S. Department of Housing and Urban Development is giving the owner of Aristocrat Manor Apartments six months to address city code violations and numerous maintenance issues revealed during HUD's annual inspection of the property in January.
HUD Region 6 Public Affairs Officer Patricia Campbell said Coffman Investment Co. may have to turn over management of the 240 Central Ave. property to a third party if conditions don't improve by February. Correspondence The Sentinel-Record obtained through a public records request showed that in addition to owning the property, the company has also managed it since the early 1980s.
A notice of default the newspaper obtained in an earlier records request said owner Marshall Coffman is in breach of a 2000 agreement that entitles the property to Section 8 Housing Assistant Payments. Rent rolls the newspaper obtained showed Coffman receives more than $60,000 a month from HUD in rent subsidies for the roughly 100 tenants at the Aristocrat.
The company charges $886 and $916 a month, utilities included, for the 440-square-foot efficiency apartments.
"HUD requested that the owner hire a third party management agent due to their failed (Real Estate Assessment Center) inspection, below average Management and Occupancy Review rating and city inspection violations," Campbell said in an email.
"In August, HUD granted an extension allowing the current management company to continue managing the property for six months due to their cooperation and the improvements being made at the property. When the six months is up next February, we will review their performance and determine whether third party management is still necessary."
The company appealed the findings of the Management and Occupancy Review, but HUD said the findings were upheld. Coffman Co. Chief Procurement Officer Kayla LaCasse said third party management is unnecessary.
"As HUD stated to you, we are cooperating and improving the property," she said in an email Friday. "We do not believe third party management is necessary. We have made improvements over the years and have managed the property, which has always had high occupancy. Over the years, with the rain issues etc., we still have been 93 to 96 percent occupied."
HUD also extended the June 22 deadline to address issues flagged during a Jan. 15 inspection. The agency gave the property a 45 out of a possible 100 points. A score of 59 or worse enables HUD to take enforcement action. LaCasse noted the property received scores of 95, 87 and 91 in 2014, 2012 and 2009.
The 79 it scored on a 2017 inspection subjected the property to annual review. HUD inspects properties scoring in the 80-89 range every other year, and those scoring 90 or better are inspected once every three years.
City inspectors cited the property for 34 property maintenance code violations in May, including one for substandard roofing. The city said ownership was granted a permit Tuesday for an $89,818 roof replacement. HUD said circumstances beyond ownership's control damaged the roof.
"As a result, when storms rolled through there was leaking which caused additional damage," HUD Public Affairs Specialist Scott Hudman said in a July email.
A July 10 letter Coffman Co. sent HUD blamed the roof problems on a toilet that had been thrown out of an adjacent building. The letter said the toilet landed on the roof and damaged it, leading to 15 of the 34 city code violations.
"We have had above average torrential rains and flooding since September of last year, and water got into the building and ran down the walls," the letter said. "There is also water damage to the walls and ceiling on five floors, where the water penetrated and the handrails are now loose."
LaCasse said work on the roof has begun.
City inspectors told Division 2 Garland County District Court Judge Ralph Ohm that Coffman Co. had made significant progress toward addressing the violations, according to a July 16 docket entry. A status update is scheduled Oct. 16.
Infestation was among the violations. The city has received numerous complaints about bedbugs at the Aristocrat in recent years, including its transportation services department complaining in November 2017 about Aristocrat residents carrying bedbugs onto city buses.
A HUD report said the company is working to secure a loan to pay for repairs mandated by HUD and the city. LaCasse said in April that HUD rent subsidies service debt on the $2.75 million mortgage granted to Arvest Bank in December 2017. They also helped service the $1.84 million, HUD-held, HUD-insured mortgage the company paid off that same month.
"Most of the repairs required by HUD and the city have been completed and will be completed," she said. "We are refinancing the Aristocrat in order to do more improvements beyond what is required."
HUD said the refinancing is contingent on the Housing Assistance Payment contract being renewed. The 20-year HAP agreement expires next year.
Local on 09/01/2019