WILMINGTON — Three apartment buildings containing more than 200 units available only to low-income residents were purchased at a public auction Friday morning by the bank that foreclosed on them.
Attorneys with Kohnen & Patton — which represented Peoples Bank in its foreclosure case against Quaker Apartments, Prairie View Apartments and Friendly Center — made the minimum and only bid of $1.4 million.
Kohnen & Patton declined comment afterward; the firm previously declined comment in a May article about the foreclosure and public auction, including about whether tenants might be evicted.
In May, when the News Journal first reported on the foreclosure and the public auction, Danielle Sollars, an assistant prosecutor for Clinton County, said the bank might bid on the property itself, especially considering its value.
An advantage to that, Sollars said, is the bank can then sell or otherwise handle the property on its own terms.
Episcopal Retirement Services, the nonprofit company managing the apartments currently, previously said tenants don’t need to worry about evictions.
“We’re managing the finances of that, and we’re adding services,” Kathy Ison-Lind, vice president of affordable living and in-home services for the Cincinnati-based nonprofit, told the News Journal in late May. “We’re really working on how we can make them better, trying to get them rent-ready.”
Ison-Lind then told the News Journal that ERS’ board was working out the financial aspects of it but couldn’t provide further assurances that residents wouldn’t be evicted.
The U.S. Department of Housing and Urban Development confirmed Quaker Apartments and Prairie View Apartments are protected by HUD regulations but not Friendly Center.
“Both Prairie Apartments and Quaker Apartments have an ongoing rental assistance contract with HUD,” wrote Thomas Leach, field director of HUD’s Columbus field office.
Prairie View Apartments’ contract with HUD expires in December of 2018, and Quaker Apartments’ contract expires in 2035.
Quaker and Prairie View Apartments offer Section 8 housing and Friendly Center provides an assisted living community for seniors.
Section 8 programs provide rent assistance to residents, effectively reducing the rent and making housing more affordable. Residents must qualify by income.
The three apartment complexes were delinquent on a mortgage by about $2.7 million. When Peoples Bank acquired National Bank & Trust, it began the foreclosure process.
The three buildings also owe $408,000 in property taxes, which should now be collected after the auction.
Reach Nathan Kraatz at 937-382-2574, ext. 2510 or on Twitter @NathanKraatz.