The D.C. Program Behind Those Vacant Properties
Cary Silverman has an excellent post this morning investigating the Home Again program, a project that the Department of Housing and Community Development started in 2002 to round up nuisance properties and dispose them to both for-profit and non-profit developers in bundles of five or more at a time. Under the disposition contract, the developer was obligated to renovate the offending structures and sell them as affordable housing.
Home Again was designed to replace the Homestead program, which had been launched in 1986 to give first-time homeowners a chance to renovate and live in formerly derelict properties. But many of those contracts ended up in default, giving rise to the new regime—developers were supposedly vetted for financial viability and expertise. After a few years, the program was moved from the Department of Planning and Economic Development into DHCD, and consolidated as the Property Acquisition and Disposition Division. Lately, PADD has favored auctions of properties acquired through tax sales and eminent domain, which reaps some profit for the District.
This iteration has been far from foolproof. According to the latest report, from the end of 2009, 262 properties had gone through the program since its inception. Only 53 have so far been sold to homeowners, and eight are in recapture, meaning the District is trying to get them back after developers failed to deliver.
One of those is 2801 Sherman Avenue, an absolute nightmare of a structure that was disposed in one of the very first bundles to Castle Development, a company owned by Joe Kisha. The building is attached to a vibrant little church, which has for a decade wanted to buy the property to expand its operations. But since the building was awarded to Kisha, the house has fallen further and further into disrepair, leaving Harvest Life Fellowship unable to even get a loan to improve its own facade. Furthermore, the other three properties disposed to Kisha's company have also been allowed to languish, in what seems to be the worst example of how this well-intentioned program can go wrong.
I've been bothering DHCD about this particular case since May—they won't talk about it while negotiations to recapture Kisha's buildings are underway. As soon as they do—or maybe even before—I'll tell the whole story.