WASHINGTON CITY PAPER: An Abandoned Building in Congress Heights Is the Keystone in a Battle Between Tenants, Developers, and the District

ANDREW GIAMBRONE 

SEP 14, 2017 6 AM

Housing2DARROW MONTGOMERY

A long-empty building in Ward 8 has become the linchpin in a redevelopment duel between D.C.’s most infamous landlord and its tenants, who are pushing to turn the building and their decrepit apartments into an affordable complex around the Congress Heights Metro stop. 

What happens to the building and the rest of the two-acre site, however, depends on the actions of Mayor Muriel Bowser’s administration, which repossessed the property from a delinquent development company in January. 

The building is on a piece of land critical for fully developing the site around the Metro, which is why developers covet it. Today it sits fallow, sealed with faux windows and enveloped by uncut grass. Across the street, plans are underway for a new Wizards practice arena and massive redevelopment on the St. Elizabeths East Campus.

A dozen tenants remain in four adjacent buildings owned by Sanford Capital, a neglectful landlord that owns over 60 buildings across the city. These tenants have suffered through unreliable heat and air conditioning, pests, drug activity, squatters, and raw sewage leaks, among other issues endemic to the Bethesda-based company’s vast portfolio. 

Now, after years of blight, the tenants are calling on Bowser to transfer the vacant property to them for use in a redevelopment plan that would create almost 200 affordable apartments and retail. The nonprofit National Housing Trust-Enterprise Preservation Corp. has collaborated with the tenants on the concept.

But the tenants, who live on low- or fixed-incomes, have competition. Sanford and local developer CityPartners have sought to transform the site into more than 200 predominantly market-rate apartments, offices, and retail. D.C. zoning officials approved their plans in 2015. Those plans included the prized building on the corner of Alabama Avenue and 13th Street SE, even though neither company controlled it. Carter Nowell and Patrick B. Strauss founded Sanford Capital a decade ago, and Geoffrey Griffis manages CityPartners.

The tenants and developers have previously met. In 2014, Strauss, Griffis, and the tenants congregated in the basement of a Congress Heights building to discuss the companies’ redevelopment plans. In 2015, both groups testified at a zoning hearing about the project. Later that year and again in July 2016, tenants fearing displacement protested against the project outside Griffis’ Cleveland Park home.

There’s no love lost between the two sides. The tenants believe the developers have intended to remove them from the 47-unit property through neglect, as does D.C. Attorney General Karl Racine, who is suing Sanford over conditions there and at another 61-unit complex in Ward 8. The developers cannot begin demolition because of D.C.’s Tenant Opportunity to Purchase Act, which provides renters the right to buy their buildings when sales or redevelopments arise.

The vacant corner building presents a key choice for city officials as Sanford’s properties decay and its tenants suffer: Whose desires will they promote in awarding the building to a new owner?

***

On Sept. 6, Robert Green took an Uber from his tumbledown apartment in Congress Heights to the Wilson Building and stood outside in the rain. Now in his late 60s, Green has lived above the neighborhood’s Metro station since 2010. 

He told in shortened form the story he’s been telling for the past four years. “The place stinks,” he said. “My neighbor does not have a front door that locks. It’s never locked since I’ve been there.” He said he hasn’t relocated because he “cannot pay $3,000 for a studio.”

Sources say Nowell, Sanford’s principal, seeks to sell the complex for a hefty sum, perhaps two or three times greater than the $2.5 million Sanford spent to purchase it. Or he could pursue a bankruptcy sale, as he’s doing for his Terrace Manor property, which is also subject to a city lawsuit.

Bankruptcy cases void tenants’ TOPA rights. This means Nowell, who didn’t answer a request for comment, could transfer the Congress Heights complex to his chosen buyer. That buyer could in turn bid on the empty building with a compelling case for assembling the lots.

The tenants’ preferred buyer, NHT-Enterprise, says it welcomes the opportunity to buy the Sanford complex either “through TOPA or a negotiated sale.” The nonprofit would raze the existing buildings and construct two new ones with approximately 175 apartments.

“The city gives away public land to developers constantly for no cost,” says Will Merrifield, the tenant association’s nonprofit attorney. “So our argument is that the tenants have gone through years of hell in these properties in order to do one thing, and that is exercise their TOPA rights.”

Under a previous plan, the building was supposed to become a home for youth exiting foster care, with help from a $920,000 government loan. But the borrower defaulted.

Bowser’s Department of Housing and Community Development says it took possession of the building in lieu of foreclosure. Public records show DHCD spent $175,000 to recover the property, located at 3200 13th St. SE. 

The agency says that before anyone can redevelop the property, a 2014 lawsuit over it must conclude. “Beginning the competitive bid process hinges upon the resolution of the civil action,” DHCD says.

That litigation is currently in the pretrial phase. Ward 8 political operator Phinis Jones and his business associate Monica Ray claim that their nonprofit, Congress Heights Community Training and Development Corporation, has a right to the property. Moreover, CHCTDC stands to receive $75,000 via a community-benefits package under Sanford and CityPartners’ project. So too is the Congress Heights Community Association, which Ray also runs. 

Both Jones and Ray are deeply involved in local election financing, having supported Bowser’s campaign and those of her D.C. Council allies. Ray didn’t respond to requests for comment. Jones couldn’t be reached.

Asked if he’s still interested in acquiring the property, Griffis, of CityPartners, says: “CityPartners is considering all options.” He didn’t respond to follow-up messages.

Just before Sanford tenants protested outside Griffis’ home last year, he told City Paper he understood the tenants were “terribly disappointed” with Sanford, but distanced himself from the company and insisted residents could return to the site after redevelopment.

The tenants’ leaders are wary of Griffis’ political clout. In 2015, he told The Washington Post he was a friend of Jones’ and Bowser’s. She appointed Griffis to the National Capital Planning Commission that year. Griffis’ family and CityPartners donated over $3,100 to Bowser’s mayoral campaign, the Post reported.

Through his firm, Griffis has also worked with Bowser’s campaign treasurer Ben Soto on four mixed-use projects in Southwest, including one that contains a D.C. fire station. Soto heads Paramount Development. He also sits on the board of EagleBank, which has loaned Sanford over $46 million and is the main creditor in the Terrace Manor bankruptcy. As the owner of a title company and a notary, he personally signed many of Sanford’s original loan documents.

In yet another link with the Bowser machine, Earle “Chico” Horton III is listed as an agent for one of three active business entities associated with Griffis and his redevelopment plans. Horton is a K Street attorney and lobbyist who chaired FreshPAC, the pro-Bowser political action committee that shut down in 2015 under public scrutiny. Horton confirms he and his firm represent the entity, but doesn’t offer details.

Merrifield says Horton approached him to set up a meeting between Griffis and the tenants. “The tenants aren’t interested in that,” Merrifield says. 

For some, the connections between Griffis, Bowser, and Sanford, which gave Bowser an illegal campaign gift that her election committee was fined for, are problematic. 

“He thinks he’s going to win because he has Geoffrey Griffis and the mayor,” Ruth Barnwell, president of the tenant association, says of Nowell. “They have this building in the crosshairs.” 

Barnwell, who is 73, has lived in her building for 33 years. “We’re not going anywhere,” she adds. “And [the mayor] can either come along and support us and give us this property, or she can continue to stand with the slumlords and the developers.”

Bowser spokesperson LaToya Foster deferred comment to DHCD. 

Following City Paper and Post investigations on Sanford earlier this year, Bowser ordered inspections of the company’s properties and called out Sanford in her State of the District Address. City inspectors assessed $539,500 in housing code violations, but Sanford’s attorneys have denied these in court.

In June, Ward 8 Councilmember Trayon White signed a letter supporting the tenants’ request to get control of the corner building. 

***

During their Sept. 6 protest, tenants and advocates delivered a letter to Bowser’s office demanding she give 3200 13th St. SE to the tenants and the National Housing Trust. “We have seen their work and trust them completely,” Barnwell explains of NHT-Enterprise. “[Their plan is] what the tenants are saying, and that’s what will be done.”

Bowser was not in the Wilson Building during the demonstration, and a staffer for her office told the tenants she’d get their message. Merrifield says the tenants have yet to receive any response from her office. 

The tenants and advocates disbanded after a failed attempt to speak with Councilmember Mary Cheh, of whom Griffis is a constituent. 

With the rain still pouring, Green again hailed an Uber, and returned home to Congress Heights. A few days later, he sent City Paper photos of a three-page memo he wrote on lined notebook paper about the protest and his living conditions.

Green has used his heart medication to kill rats that roam his abode, but he manages to maintain a sense of humor. “When it rains real hard and heavy,” he wrote, “the buildings have their own private lake in the basement, which I should stock with trout.”