Developer Steven Kaufman of Eshel Management sued the federal Department of Housing and Urban Development in May, charging that the agency should have accepted his $14 million bid for Medgar Evers Houses--a six-building, 465-apartment complex--instead of awarding the project to three nonprofit organizations.
“We were the winning bidder,” Kaufman told City Limits in May, before filing the suit. He did not return calls seeking comment last week, but his lawsuit claims that he met the minimum bid based on what HUD had told him.
HUD refused to comment on the ongoing litigation, but sources say the agency will argue that the minimum bid for Medgar Evers was actually $37 million.
The lawsuit puts on hold the $24 million plan from the Community Service Society, the Settlement Housing Fund, Long Life Information and Referral Network and the Medgar Evers tenant association to fully rehab the buildings and add social services and community activities.
The tenants certainly hope this is resolved quickly, since, they say, they have been waiting long enough. Five years ago, HUD seized Medgar Evers Houses from its previous owner for failing to maintain the property [“Sweet Victory,” October 1997]. Since then, the federal agency has managed the buildings, and in March announced it would award the deed to the nonprofit groups.
Recent news reports also make tenants and their advocates fearful of what a Kaufman management could look like. The Village Voice reported last week that Kaufman’s Eshel Management evicted families from more than 150 apartments at Noble Drew Ali Plaza in Brownsville this past summer, replacing them with homeless families, for which the city Department of Homeless Services pays management about $95 a night per family.
Eshel is a “major player” in “a terrifying scheme in the poorest neighborhoods to evict massive numbers of tenants, who are unable to defend themselves, in order to capitalize on the terrible problem of homelessness,” said Legal Aid attorney Mimi Rosenberg, who is representing many of the evicted Noble Drew tenants.
Those involved in the Medgar Evers project say they are confident that federal Judge Nicholas Garaufis will rule in their favor, but for now, all they can do is wait. “We’re very frustrated,” said Lee Warshavsky of the Settlement Housing Fund. “We can’t do a thing.”