Lenders foreclose on Peachtree-Pine shelter
By Maria Saporta
Friday, May 7, 2010
After several aborted attempts, the Peachtree-Pine shelter for the homeless was foreclosed upon on May 4.
The lenders who own the building on the edge of downtown and Midtown Atlanta, and the Metro Atlanta Task Force for the Homeless, had been trying to work on an agreement for the past several months on the outstanding debt and the operations for the shelter. The Task Force has owned the building at 477 Peachtree St. and operated it as a shelter since 1996. It houses 500 to 1,000 men each night.
The two parties, however, were not able to come to an agreement.
“It was not an easy decision (to foreclose),” said Emanuel “Manny” Fialkow, the business affairs consultant for Ichthus Community Trust, which purchased two primary loans on the property this past January.
Fialkow said that the reason the lenders decided to foreclose was because the Task Force had not insured the property, which was essential to secure the collateral.
“We have no plans for redevelopment at this time,” Fialkow said. “We plan to continue operating it as a shelter, and we are hoping the Task Force will work with us. We are trying to get every one to work together.”
Steve Hall, the attorney who has been representing the Task Force, said the organization was looking at its options.
“We are profoundly disappointed at what’s happened,” Hall said. “We are profoundly disappointed that elements of the business community in downtown Atlanta would work to bring about this type of result, which hurts nobody more than our most defenseless citizens. It is a travesty.”
But Fialkow said the lenders would stick with their commitment to provide at least $500,000 towards “helping these men transition to better living environments.”
Jack Hardin, co-chairman of the Regional Commission on Homelessness — which is part of United Way of Metropolitan Atlanta Inc., said he already had been in touch with the Ichthus representatives.
“The new owner has asked us for help in finding places for the men,” Hardin said. “It will take months to work through this and find solutions.”
Hardin said the commission also had offered to help the Task Force. “Ever since we learned of the financial difficulties of the Task Force, we have offered our assistance in the form of sending our case workers to interview the gentlemen and find solutions. But we haven’t been allowed in.”
Hardin said that the commission has advised Ichthus that it will take four to six months to complete the plan and move the homeless out of the shelter and into other living arrangements.
“We have got to raise the money to implement this plan,” Hardin said. “We are confident the community will support this. From the beginning of this crisis, our focus has been what is in the best interest of those men and to find housing solutions.”
The Peachtree-Pine shelter has been a lightning rod in the community. The Task Force has accused the city of Atlanta and downtown business community of trying to put it out of business. On the other hand, business and city leaders have not felt the shelter has been well-run and that it has become an eyesore and an unsafe place in a key part of downtown.
A.J. Robinson, president of Central Atlanta Progress, did not comment for this story.
Bob Cramer and Anita Beaty, the Task Force’s chairman and executive director, respectively, did not return repeated e-mails or phone calls seeking comment for this story.
Hall insisted however that the Task Force will continue fighting, most likely with litigation.
“We are going to do everything possible on two fronts,” Hall said. “No. 1, we will protect the people in the shelter that we serve. And on front two, we will seek redress for the injuries to the Task Force that have made job No. 1 so difficult. We are committed to both.”
Fialkow said that Ichthus had been operating “under the threat of litigation” for the past several months, and that was one of the reasons why the lenders had tried to reach agreement with the Task Force.
But Fialkow said that during the discussions, “there was no plan to pay us back.”
The note on the building had first come due in June 2006, he said.
Ichthus purchased two primary loans on the property from Mercy Housing, a nonprofit lender in Colorado, and the Institute for Community Economics, a nonprofit based in Massachusetts. Both loans totaled about $900,000.
In a later e-mail, Fialkow wrote: “We hope that the Task Force chooses to work towards continuing to transition the men to better housing arrangements and working with the community and the Regional Commission towards that goal, especially now that the burden of the overwhelming debt is lifted. Ichthus is still committed to this transition and has no near term plans to do anything with the property other than its current use.”