By: Dan Waterhouse
If the lender agrees, the Fresno Housing Authority will rescue H. Spees’ One By One Leadership property along both sides of historic L Street, a few blocks away from the failed Fresno Metropolitan Museum, by buying all of it. According to a One By One board member, if the sale doesn’t occur, there is no “Plan B.”
A Housing Authority representative announced at the City of Fresno Historic Preservation Commission on December 14 that extending a loan (or line of credit) to One By One would not be prudent, so the agency had offered to buy all the property instead. Housing Authority representative Thomas Davis said plans are to develop mixed-use housing on the east side of L Street and to restore and sell the historic homes on the west side of the street.
The original planned $500K line of credit, according to One By One board member Mike Zachry, was intended to restore the Helm Home at 1749 L Street and mothball the Newman Home at 1743 L Street. Both homes, along with several others now owned by One By One in the same block, are on the local register of historic places. Davis said the Housing Authority would follow through on the work originally planned and had money available to secure all the homes from further damage. He said there were local, state and federal funds available to do the restoration work. He added that the Housing Authority has big plans to be involved in downtown development, and this is the first project of many.
As of the deadline, according to Preston Prince, the Housing Authority’s executive director, Central Valley Bank (One By One’s lender) had not accepted the offer. The bank has to agree to the sale because the current value of the property is much less than the amount of the bank loan. Davis originally said on December 14 that a decision by the bank was expected by Christmas.
Davis and Zachry agreed that, if the sale to the Housing Authority fell through, there was “no Plan B.” Zachry told commissioners that One By One does not have the money to do anything with the historic houses. Zachry’s story changed from the November meeting, when he said the loans weren’t in danger of default. He now says the bank “really doesn’t want the properties.” Commissioners also weren’t told by One By One that the Newman Home and the Bean Home at 1705 L Street were in default for back taxes owed the county, until that information was passed along to City staff before the November 23 commission meeting.
When One By One bought the L Street properties six years ago, the organization planned to reuse the homes to house nonprofit organizations. One By One quickly discovered it did not have the financial resources to restore the houses and made numerous attempts to sell them. Those attempts have mostly failed, and several of the houses are, as Karana Drayton, the City’s historic preservation manager, says, being “demolished by neglect.”
In addition to the general neglect, two have been severely damaged by fire: the Newman Home in September 2009 and the house at 2221-23 San Joaquin Street in December 2006. The Newman Home sits exposed to the elements because the roof is too badly damaged by fire to cover with tarps, whereas the San Joaquin Street house sits a gutted shell—the bank took the insurance payment to satisfy past-due mortgage payments. Zachry says the insurance company wants to “lowball” the value of the Newman Home. The City considers the Newman house a 70% total loss due to the September fire.
While Granville Homes and One By One were in negotiations this summer, Granville principal Darius Assemi approached the preservation commission, seeking its input on a mixed-use residential development on the east side of L Street. When Assemi gave a presentation on that proposal at the June 2009 commission meeting, then Planning commissioner (and former preservation commissioner) Cam Maloy urged the commission to support the proposal. Maloy suddenly stepped down from the Planning Commission on October 8 after she revealed to Mayor Ashley Swearengin (who had appointed her to the commission) that she had received two loans from businesses owned by the Assemi family. Zachry told the Historic Preservation Commission in November that the escrow on the east side properties “was cancelled for unknown reasons.”
After two years of back and forth with One By One and as the Granville Homes proposal began to play out, the City issued a courtesy notice in February 2009, outlining the visible violations of the minimum maintenance provisions of the historic preservation ordinance, at the Helm and Newman homes, as well as at 1718 L Street and the San Joaquin Street property. The preservation commissioners delayed any enforcement actions, pending the outcome of the sale negotiations with Granville Homes and the completion of a protocol manual.
The protocol manual was done and ready for adoption by the commission when in November code enforcement and city attorney staffers suddenly objected to it, and it was shelved by the planning director. A motion to proceed with code enforcement against One By One was voted down at the December meeting, primarily because commissioners wanted an explanation of why the manual was shelved, why the fines would not go toward repairing the houses and whether action by Code Enforcement would eventually lead to the houses being demolished.