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A little-known Florida housing company with a spotty track record was recently awarded an exclusive federal housing contract to manage troubled properties in 42 states, City Limits has learned.
On December 31, the federal Department of Housing and Urban Development awarded its multimillion- dollar property management contract for everything from collecting rents to making big repairs to the Miami-based National Housing Group, a six-year-old business that’s left several financial disputes in its wake. HUD’s decision became final on April 23, when the General Accounting Office denied a protest brought by the previous contract holder, Arco Management.
HUD’s choice for managing the troubled properties that often languish in its portfolio for years is a virtual unknown — even in the company’s home turf. City Limits called nearly a dozen nonprofit housing developers and housing officials across Florida, and not a single one had ever even heard of the National Housing Group, or its principals, Maggie Pedraza and Wynee Joyner.
The group did manage the troubled Graham Park and Rogall Congregate public housing complex in St. Petersburg, Florida. However, in March 2002, after only one year on the job, the National Housing Group did not renew its contract, leaving behind a dispute over $25,769 in rent money, according to the St. Petersburg Times. An attorney for the St. Petersburg Housing Authority told City Limits “there are some issues we’re still working on” with the group, more than a year later.
Closer to home, the engineering and architecture firm Louis Berger & Associates successfully sued the National Housing Group for nonpayment of services arising from a contract the group had with the East Orange Housing Authority in New Jersey. According to a Berger attorney, the housing group didn’t even contest the $20,000 suit — a default judgment was entered in New Jersey civil court, but National Housing Group has still not paid its debt.
Neither HUD nor the National Housing Group responded to detailed questions from City Limits. They also refused to provide information about how much the contract will cost, or how many buildings it covers.
But the GAO says the company won the contract in large part because of its low bid — in the region that includes New York, the group submitted a “weighted unit” bid of $132, a full 33 percent less than Arco’s $197 bid.
The National Housing Group is in the midst of taking over Arco’s New York operations, according to former NYCHA official Joseph Shuldiner, who has been hired by the group as a consultant. It will soon manage Jose de Diego Beekman Houses in the South Bronx, several Bedford-Stuyvesant projects and some of the buildings caught up in the 203(k) scandal in Bushwick and Harlem. Shuldiner said his client plans to keep most of Arco’s staff, replacing only supervisors and management.
One housing professional who praises Arco’s work — Rick Wagner of Brooklyn Legal Services Corporation A calls them “the Rolls Royce of management companies for minority, low-income, subsidized projects” — wonders whether the less experienced National Housing Group will be able to adequately serve tenants, especially since they intend to do the work for a third of the cost. Asks Wagner, “Don’t you have to show some kind of track record of successfully managing a public housing project?”
