OPINION: Vote “No” on Peary Court Purchase
by Diane Beruldsen…….
I attended recent affordable housing workshops and felt there were many people who were not getting listened to. The meetings scaled over concerns that the group being protected (those who can afford to pay $2400/month in rent) were the wrong group to protect.
For this reason, I wanted to hear the opinions of people in the streets of City of Key West.
I set out Sunday, February 28th on bicycle, into Key West and approached anyone I came across to ask if they had an opinion on Peary Court. First I went to Sandy’s Cafe, and got a few interviews, then I headed down into Bahama Village and got one more on Petronia Street, then Duval Street, there were so many tourists who knew nothing about the issue. My last area was at Harpoon Harry’s and then Lands End Marina.
Here are 6 interviews and the question asked was: Should the City of Key West purchase Peary Court. (See video above.)
This is a YouTube video. It took me a couple of minutes to figure that out and watch it. I can be little dim sometimes , but not dumb enough to buy this pig in a poke. I’m not falling for it. Build new, build cheaper, on land the City already has.
If anyone has a partial solution to build new, build cheaper and on the land the City already has, we should support that TOO. This partial solution is here and it MAKES money for the City. Let’s support it and any other GOOD partial solutions to the problem.
We don’t know it will “makes money” and certainly not for the City”. In truth this will NEVER make money for the city. After expenses: mortgage (or bonds) payment, repairs and maintenance, water bills and any other utilities, management fees, and insurance – flood and fire (these will only go UP) if in theory there was any excess money, it would NOT go into the city’s general revenue fund – so the city will NOT make money. Those of us who have owned rental properties will bet that “affordable” rents in most peoples minds will never cover all the expenses now or that will rise with inflation over the next 10-15 years. And how long is the mortgage projected to be?
I am a strong supporter of affordable workforce housing for those who provide essential services – but Peary Court is NOT the solution. And for those workers whose wages have not risen over the past 20 years as hotel and restaurant prices have more than doubled – provide your own housing for your workers…NOT the taxpayers!
If you want another boondoggle like the new city hall or the waterfront park vote for Peary Court and then pray. My intuition is for a strong NO vote.
A trip down memory lane……
https://thebluepaper.com/article/twenty-years-later-was-harry-powell-right/
I agree that the history is silly on this issue, but it is what it is. Let’s not let the silly past blur our vision on the subject at hand: The City NEEDS more affordable housing. This PARTIAL solution should be seized, along with all the other partial solutions that make sense.
Yet another disservice to the people of the City of Key West perpetrated by the Blue Paper. How many people will see this headline and decide to NOT support this measure?
Let’s start by AGREEING that the City NEEDS more affordable housing. Let’s also agree that the problem is so big that no single solution will solve it. And then, let’s agree that DOING NOTHING (which is what voting “no” amounts to) will not help at all. Understand that I am NOT employed in any way by the City or any other group that stands to profit by this sale… I am simply a concerned citizen who really wants to see the problem of affordable housing addressed in a responsible manner.
Although the audio was pretty bad, I was able to view this video and found nothing but misinformed people sharing unsupported positions on the issue. The City clearly listened to those who said that the rents needed to be less than $2,400. That’s why the plan includes an option whereby HALF of the units will rent for less than $2,000 and 25% will rent for just $1,571. Show me ANY decent property of this size renting for that litlle on the market today in Key West…you can’t!
As for the grievance about the City NOT buying the property for $34M a few years ago…that was not the City’s fault, that was Balfour Beatty’s fault… they would not share proprietary information in a public forum (the only way a government entity can make such a purchase), so the City was effectively excluded from the competition to buy the property. So, now the City has the legitimate option to buy the property at a reasonable market value, we need to ACT and make it happen. Even if you think $55M is too much (and I’d like to see the Appraisal Report you base your assumption upon), that is a MOOT POINT! If you look at the numbers (and I have, very carefully), at that purchase price, and with rents as low as $1571 on a quarter of the units, this project still MAKES MONEY for the City of Key West. Money that can be used to further address the problem of affordable housing.
So let’s recap:
– Buying Perry Court will provide 160 affordable housing units for the City
– Buying Perry Court will MAKE money for the City
– Profits from Perry Court will go toward other Affordable Housing efforts
– FAILURE to buy Perry Court will NOT HELP the housing crisis
– Voting “No” will make the housing crisis worse by doing nothing about it
– Voting “Yes” is a great step in the direction of solving the affordable housing crisis
I see thing totally opposite.
Let me add/adjust Just Jim’s recap:
-Buying Peary Court will NOT provide 160 affordable housing units for the city because the rents proposed are too high to come close to meeting the definition of “affordable”.
– Buying Peary Court will NOT make money for the city. The financial statements provided show an minimal annual profit but they assume totally unrealistic costs. When you correct for the costs the profit swings to a loss.
– Since there will be NO PROFIT from Peary court, rather than have money to put towards affordable housing efforts will not be there. In fact Peary Court will drain possible funds.
– Failure to buy Peary Court WILL HELP the housing crisis. It will force the city to actually develop a realist long term plan for this issue. Rather than overpay for a property that really does not meet the stated needs of affordability.
– Voting NO sill help the housing crisis because better alternatives exist that can provide significantly more housing units for the same amount of money.
– Voting YES is a step in the WRONG direction as it will become a money losing example that will derail any future efforts.
Thanks for your opposing position. On what do you base your assumptions?
-“The rents proposed are too high to come close to meeting the definition of “affordable”.” Those rents (1/4 at $1571, 1/4 at $2k and 1/2 at $2400) are FAR lower or at least equal to market rate in Old Town. And good luck finding anything at ANY rate with the way the rental market is. That’s why PART of the solution NEEDS to be creation of NEW housing.
– “The financial statements provided show an minimal annual profit but they assume totally unrealistic costs. When you correct for the costs the profit swings to a loss.” The numbers the city used were very conservative…they used a figure twice as high as what it costs them to operate similar housing elsewhere in the city.
– Again…the City used regularly accepted accounting practices to estimate their figures, so (at the very least) the property will break even. If they were to use the higher rent figures (Still below market) they couldn’t help but make a profit.
– “Failure to buy Peary Court WILL HELP the housing crisis. It will force the city to actually develop a realist long term plan for this issue. Rather than overpay for a property that really does not meet the stated needs of affordability.” Translation: DO NOTHING. We need both a long-term AND short-term approach. There is no single approach, and there is no PERFECT approach. If we keep scrapping decent plans due to minor imperfections we will never get anywhere. If you subjected Washington’s plan for crossing the Delaware to the same scrutiny, we would still be singing Hail Britania
And so I assume, Jim, that you also believe that the PAC waving signs around town to “Vote Yes” is a disservice to the Community? How many people will see those signs and vote “Yes”!
And was our publishing of PAC member Maureen Bramlage’s “Vote Yes” also a “Blue Paper disservice”? The headline clearly states it is OPINION – and the Blue Paper prides itself on giving a voice to the little people – those who may not have the funds or the time to form a PAC to get the word out that they believe this purchase is a bad idea.
By the way, I did not hear you chiming in when we published stories about how the City was allowing the redevelopment of a trailer park on Simonton Street into single family homes that go for nearly a million dollars – a trailer park that was actually providing “affordable workforce housing” to approximately 100 people. Why didn’t you [and your friends on the PAC] cry out for the City to offer the owners twice what they’d paid for it to “save” those people? That property too was a missed occasion for the City as it was up for sale from the Archdiocese of Miami and Peter Batty – who the City Commissioner know all too well was the broker. It sold [44 Rogos] for 2.4 million – why didn’t the City try to buy it then? Did you know that some of those people who were put out of the trailer park are still homeless?
Now, about who is and who isn’t misinformed:
There is absolutely NO INDICATION whatsoever – that any financial institution will come forward and finance the project of purchasing Peary Court based on the rent roll that you described. In fact the City only furnished one proforma to the over 200 banks they reached out to – and that proforma showed all 157 units rented at the $2358/month “moderate-income affordable” cap. AND the ONLY bank that came back with a proposal set the debt service ratio at a level that would not allow the rents to be any lower and also required that the City back it up not only with rents and the property but with a general obligation. [Yes, we all know that can’t happen because the referendum says it can’t].
Now, about why the City didn’t make any effort to purchase the property when it went up for sale a few years ago. Yes, it was the City’s fault. No it was not simply because of a “confidentiality requirement”. We wrote about this not long ago and linked to the minutes of the Monroe County Land Authority Executive Director that showed that both City Manager Jim Scholl and Mayor Craig Cates were among the first to know that the property was going up for sale. Cates later told the Land Authority Executive Director that he was aligned with those who believe that government shouldn’t be competing in the real estate business with the private sector and he announced that he wouldn’t block the City purchasing Peary Court but he wasn’t about to promote it. Nothing wrong with that, however, neither he nor Scholl alerted the rest of the City Commissioners about the “opportunity”. The majority might have felt differently.
About the confidentiality clause. Not getting the brochure [and that’s all it really was] from the sellers did not in any way PRECLUDE the City from learning all they could about the property through site visits and public records and making a bid on time. After all, unlike others who were bidding, the City representatives know the community and the property very well. Also – with a former Navy Base Commander as the City Manager and a very community oriented Ron Demes representing the Navy – along with some public pressure regarding our “housing crisis” – it is highly doubtful that, had the City bothered to ask, the Navy would have rejected the City’s request for the Navy to put pressure on Balfour Beatty to allow the City a right of first refusal to match the winning bidder. Remember the Navy – not the Public Private Venture called Southeast Housing – owned the LAND at Peary Court.
Now as to your recap:
1. There are only 157 units [the other 3 would have to be built from scratch]
2. Is the City trying to MAKE money in real estate [while not paying Monroe County and School taxes, etc] or is the City trying to lower rents on the apartments at Peary Court to assist those that are currently living there and future tenants who are cost burdened? Do we want a City that has an interest in keeping rents in Key West high because it owes such a large amount of money to a financial institution and can’t afford for competition to rise and rents to lower?
3. We have 12.5 million in the bank for workforce housing – why are we not making an informed decision on what is the BEST thing to do with that money? Did you know that the City doesn’t even have an analysis of how many new units we could fit on land already owned by the City and other government entities that they could partner with and the cost for those units? How do we decide what is the BEST thing to do with 10 Million dollars without even bothering to learn about the basic options?
4. FAILURE to buy Peary Court could actually help diminish the housing crisis. How? By not spending all of that money on housing that is not at the top of the priority list in terms of needs analysis we could build/provide units that are truly needed. Did you know that in 2013 the City adopted its Comprehensive Plan data relative to workforce housing? Did you know that the data that our Comp Plan relies on states that there is a SURPLUS of “moderate-income rental units” [that is the level of rent that we are talking about at Peary Court] and that there is a SHORTAGE of low and median income rental units? How will we build NEW units NOW if we use up the bulk of the money on the Peary Court purchase? Oh, let me guess. “Public-private ventures.”
5. About those Public / Private ventures: Ed Swift at the Democratic Party workshop on workforce housing stated that developers could only build “moderate-income” housing…. What kind of bargaining power will we have with these developers without money to build ourselves compared to having the money and being able to say – OK well – we don’t like your deal – we’ll just build it ourselves. And hmmm… doesn’t our Comp Plan document state those “moderate-income affordable rental units” are at the bottom of the list of what is needed? Something is not working out here in terms of moving forward in a rational manner. This – “Whatever!” “There’s more money where that came form!” – and “It’s just money from those tourists after all!” – “We need housing for all income levels!”… “Let’s give it a try” mentality – and this “Let’s not miss out on this great opportunity to own a large piece of prime old town real estate” attitude is questionable to a lot of people.
Actually understanding what is needed is also an option, finding out about how building new lines up financially with the option of buying Peary Court in terms of net gain would be a rational approach as well. Did you know that the Housing Authority of Key West built a mix of one, two and three bedroom units on Fort Street in 2012 for less than $93,000 a unit? Did you know that the cost for the assisted living center units about to go up at Poinciana [60 of the 208 are not assisted living by the way] are averaging $159,000 a unit. Again we have a mix of sizes. How much would it cost to build hundreds of efficiencies and how many could we build on land that we already own? That’s what these “uniformed” people you point at are thinking… and what’s wrong with that? Why would you want to deny these people the right to state their opinion – Their opinion which is legitimate and comes down to, before I vote yes – show me the fully evaluated rational basis for this purchase of 157 “moderate-income” 2 bedroom housing units – at a selling price that is, when you take into account the estimated yet unknown quantity of land that the seller will retain, nearly double what was paid just 2 years ago…
Here’s any idea…why don’t we just keep fighting about it and never do ANYTHING? I am not now, nor have I ever been part of ANY PAC. If there were a viable plan on the table to BUILD housing on city-owned property, I would vote for that as well. We NEED to take action and STOP squabbling over the past. This is the only plan I’ve seen to move forward. This is a good first step. As I see it, this is NOT a “all or nothing” choice…voters can choose this option AND any further plans put on the table.
And by the way…I haven’t seen any signs waving around town (and I do get out quite a bit), nor did I see Ms Bramlage’s piece in your paper (I’m guessing it was not as “visible” as this one, but allow that I may have just overlooked it, since your emails are not always my top priority on Friday mornings).
Yes, Maureen’s was just as visible she was in the same exact slot – third from the top last week – and I even paid money to shoot hers around on Facebook. But that’s not really important. Do you not find it interesting that no one in a position to do so – whether it be those on a committee for affordable housing, or those who were elected to look out for our best interests – ever put any real energy into anything having to do with this “crisis” apart from this proposal to spend $55 million dollars and essentially wipe out our land authority bank account? Not saying buying Peary Court is necessarily a bad idea – but there is no credibility when those pushing for it have not even bothered to conduct an analysis of what else we could be doing to build new units with that same 10 Million. That has zero to do with the past – it is about moving forward rationally in the future. If I had 10 Million dollars to solve a problem I would do my best to learn what I could about all of my options. That is not what is happening. Did you know that at this time we have a City policy that requires about half of our allocated ROGO to be set aside for affordable housing and that our new City Planner is putting forth a proposal to do away with that distinction? He would like to see a point system set up that would not protect any ROGOS for affordable housing but would just give developers who agree to build affordable housing a priority over those who want to build market rate. I ask: What if no developers put forth proposals to build affordable? We are told they are not doing so now. Is that a positive move? Couldn’t that just result in all 652 ROGOS that are left being allocated to market rate development. Why can we not move forward with a comprehensive plan that makes sense? Why should we move forward with – Oh who knows? Let’s just buy this great piece of real estate in old town and have the City be one of the landlords that rents to folks who have to pay more than 50% of their income for housing…. Really?
me thinks just jim protest’eth too much!
sure is a booster for the yes pac….ahhhh refresh me…was that the jimmyboy weakley hta/swift pac? 😉
First – It is not 160 units. It is 157 units with the ability to build 3 additional units that burned some years ago (I stood and watched as they burned). That is IF or WHEN there is money to build those 3 additional units.
Next this will NEVER make money for the city. Any excess revenue over expenses will NOT go into the general fund – “make money for the city” – it is set up to go into a separate fund to further support workforce/affordable housing. That would be a good thing if there was to be any extra money…but what if rents fall short of covering expenses – does the city lose it’s $10M in failing to make payments only from rents, as stipulated in the referendum. Please be accurate with your statements. And if you want to be further accurate – you are not taking into consideration the loss of property taxes for Peary Court if the city was to purchase. That would be a significant loss of moneys that do come into the city!
Furthermore, over the years there will not be profits, there will only be additional costs and expenses with the age of these buildings, increasing insurance costs to cover the mortgage, and then everyone is going to be screaming when rents go up!
And have you investigated or read a local engineers report on sewers in the area and high tides in that particular area – this alone is reason enough to vote NO.
And lastly, you never ask the important question IS THIS THE BEST USE OF OUR POT OF MONEY – about $12M? Once it is spent, it will be a long time before enough money accrues to do another or a better project. Lost opportunity with a purchase of Peary Court is something the city and no one else has analyzed – what else could we do with that money, and actually realize a net increase in housing? A Peary Court purchase does not increase the housing pool. Isn’t it best to consider all the alternatives, costs, and outcomes before shooting our wad on Peary Court?!!
Sadly, there are few to no good reasons for vote for a city purchase of Peary Court.
The only smart and responsible vote is NO on Peary Court at this time.
Why should we buy something that already exists now? Peary Court is housing, although not super affordable, it’s there now and likely will stay for a while. In the meantime , save that 10 or 12 million for new , cheaper housing on land the City now owns, and get off our butts and get it built. Don’t buy it.The present owners are probably making a tidy profit with their rentals. I would be suspicious of the city trying to do the same – all in the name of “affordable housing”. It’s counter intuitive , a sop , and a weak attempt to pacify the citizenry.
Get it right, this ain’t it.
Just maybe not so good. Why would you sell a money maker ? Just maybe they see major repairs coming. Or simply see a sucker willing to buy it for more than it is worth.
Just to throw some more fuel on the fire…
Imagine if the City had not been forced to pay the Eimers settlement…. and the pending Murphy taser lawsuit (I am figuring this one will be equally as large)….
There would be $2million more money available for issues like affordable housing…
If only certain rouge members of KWPD could control themselves… then we could have more affordable housing. Gee… why is nobody asking that question?
The settlements (when under a million dollars) are paid for by the City’s insurer…
Thank you for the clarification.
I guess the city’s insurance rates will be rising instead.
I ALREADY VOTED ‘NO’ ON MY ABSENTEE BALLOT. IT MADE SENSE.
A $350K, as the Perry Court houses will cost, house is NOT affordable to rent or buy by average workers, it is a difficult buy for middle class wage slaves, perhaps. Just because a bond issue will pay the price, and affluent managerial-level residents will pay back the bond, doesn’t mean we have to act goofy and invest in such an overpriced option to alleviate the local housing shortage for well-paid careerists.
“Tiny Houses” can be built for $35K, 10% of that price! Many tiny houses can be built on the huge open spaces which the city already owns in the Poinciana Housing project. Tiny houses are cute and cozy cottages, with living spaces equal to a 30′ boat. They can be mortgaged for $100 a month. THAT is what is honestly “affordable.”
I also voted “NO” on my absentee ballot.
I saw the video of the woman who was living in Peary Court
who had to move out next day, because the rent was too high
Did everyone miss that?
How is the city purchase of Peary Court going to help people
when they can’t afford to pay it’s rent?
Best way to fight fire is with fire.
Create some true affordable units on the property the city already owns and many will leave Peary Court. Then watch the rent rate drop. And by fixing the shortage it not only lowers rent at Peary Court but other private property.
But this creates another legal issue as to competition. Can a city do this ?