The Better Housing Foundation said it won’t be able to make an upcoming payment on $85 million in bonds sold to buy a Chicago apartment portfolio.
The Ohio-based affordable-housing nonprofit said the financial performance of the nearly 1,000 rentals has lagged because of the poor condition of the properties, leaving it unable to make debt payments due June 1, according to Crain’s.
A Chicago Tribune investigation last year found mismanagement by the foundation and numerous code violations at buildings it owns. The properties failed so many inspections the Chicago Housing Authority banned its aid recipients from moving into most units.
The foundation ended up suing two firms owned by L. Mark DeAngelis that had been contracted to manage the properties. DeAngelis and Ohio lawyer Meredith Rosenbeck had teamed up to start the foundation and began buying buildings in 2016 using bonds issued by the state.
The value of the bonds has plummeted in the wake of the foundation’s troubles, according to Crain’s.
In addition to the nearly 1,000 units in 75 buildings on the city’s South Side, the foundation also bought 900 apartments in the suburbs. But those properties have fared better financially.
A new board took over the foundation in November, and has taken steps to stabilize the properties, it said in a statement. [Crain’s] — John O’Brien