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Foreclosure imminent on Peaselburg property

Neighborhood Investment Partners (NIP), established as a private property investment company whose president is also the executive director of the public Housing Authority of Covington (HAC) and whose board of directors includes three members of the Housing Authority's Board of Commissioners, is not related to the Housing Authority of Covington, said director Tony Milburn. A special meeting of NIP's board of directors was called Thursday evening to deal with the imminent foreclosure of the property known as Emery Drive Apartments in Covington's Peaselburg neighborhood. The meeting was held at the Housing Authority of Covington offices.
NIP purchased the property five years ago and is now in need of refinancing the loan through the Cincinnati Development Fund to whom the mortgage is due September 1. Aaron Wolfe-Bertling, executive director of HAC and president of NIP, explained that $1.7 million is owed on the property and proposed that a letter be written to the Cincinnati Development Fund extend the due date of a $400,000 payment so that the mortgage can be saved. Wolfe-Bertling blamed the downturn in the economy for the decline in the property's value and the rental rates that have remained flat.

He also explained that the National Development Center could help in assisting with other possible financing options. The goal is to pay the $400,000 due reducing the note to $1.3 million and then paying the balance on a cash-flow basis.

The mortgage is not the only issue facing the NIP-owned property. More than a dozen Peaselburg residents attended the meeting to voice opposition to one proposal on the table: putting additional HAC subsidized units in the development. They complained of declining property values, increased crime rates, and the eyesore of a shut-down swimming pool on the property. With City Heights just up the hill, Peaselburg has more subsidized housing than any other Covington neighborhood, they said.

Emery Drive is made up of five buildings with twenty-three units. NIP is interested in having HAC fill 11 of those units with subsidized housing for seniors and the handicapped. NIP director John Spence, who is also on the board of commissioners at HAC, said that this option would free up more flexibility in the other four buildings for more market-rate rental opportunities. In order for that to happen, HAC would have to issue a request for proposals from interested property owners that would like to use the subsidized vouchers and NIP would have to apply.

Covington Mayor Chuck Scheper and City Manager Larry Klein were on hand and Scheper suggested that HAC/NIP examine what a group called Cornerstone has done in turning around properties in Cincinnati's Over-the-Rhine neighborhood. "I don't want to have a black eye that we've defaulted on these loans even though it's not our responsibility," Scheper said.

None of this will matter if the Cincinnati Development Fund rejects NIP's plan and forecloses on the property. The board of directors voted to send a letter to CDF with a request for a delay of 75 days as they work at establishing a plan of action to save Emery Drive.