Q&A
Timeline and costs associated with Neighborhood Restore's interim ownership
0:53:00
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75 sec
Kim Darga provides information on the timeline and costs associated with Neighborhood Restore's interim ownership in the Third Party Transfer (TPT) process.
- The interim ownership period ideally lasts a couple of years, but litigation can extend it
- In the last round, the average interim ownership period was over 4 years due to increased litigation
- Neighborhood Restore spent $28 million on operations in the last round
- Funding for operations comes from a fee provided in the development budget, which establishes reserves for interim operations
- The process is designed to be more efficient than the pre-1996 system of direct city ownership
Gale Brewer
0:53:00
How long does that take, and how much does it cost us in?
Kim Darga
0:53:03
So how much it takes is a little complicated?
0:53:06
Yeah.
0:53:07
It it should be a couple years.
0:53:08
We've had some instances where there's litigation and it takes longer.
0:53:13
The last round, there was a higher amount of litigation, and so the average is over 4 years.
0:53:19
For them holding the property, that's certainly a lot less than back in the days of interim.
0:53:24
Mhmm.
0:53:25
And in the last round, they have spent $28,000,000 in on operations.
0:53:34
The city, as part of stabilization.
0:53:38
Once the assigned property manager and developer puts the financing and renovation plan together, we're providing additional support beyond that.
0:53:47
So they're really just helping to make sure the critical issues are addressed during that stage.
0:53:53
That money largely comes through us providing a fee in the development budget.
0:54:01
So once we close on production financing, they get a fee that fee goes to establish reserves that then help them with the interim operations.
0:54:10
Okay.
0:54:10
That's complicated.
0:54:11
I'm happy to explain more if necessary.
Gale Brewer
0:54:13
Thank you very much.
0:54:14
Thank you.
