Change of Ownership Sparks Worries at Housing Complex

Geri Cruikshank left her ninth floor apartment a little early, because the line of seniors waiting to receive their free monthly box of food on the first floor was already snaking last Friday.

As the 77-year-old resident of Sorrento Tower helped set up the community room, she spotted a news story resting on the piano, accompanied by a picture of her apartment building.

“What’s this?” she asked herself.

What she read disturbed her. The owners of Sorrento Tower, where she’s lived for 13 years, were ready to sell the building to a fledgling development company. She learned the company, C&C Development, was founded by former executives for San Diego-based The Amerland Group.

Prosecutors recently charged five other executives from Amerland and one of its subsidiaries with manslaughter and more than 100 cases of elder abuse in relation to a 2008 fire that killed four elderly tenants on a Vallejo property.

It was the first that Cruikshank had heard of the plans for the building. And in the last week, the plans have raised alarm among some of Sorrento Tower’s low-income, senior residents worried about what the sale might mean for them.

Just last month, many residents were excited to learn that Sorrento Tower’s management company, Commercial Facilities, Inc., had made progress in finding a third entity to help finance its promised renovation plans for the building’s leaky windows, backed-up plumbing, and sometimes mold-infested ventilation system.

“We were glad we weren’t going to freeze our bunnies off, that the plumbing and elevators would get fixed, that our apartments were going to be improved. We would be crazy not to,” said Ann Jackson, a resident of Sorrento Tower.

What management officials didn’t tell them was that C&C Development planned to buy the building or that the company’s founders — Colin Rice and Casey Haeling — were former executives for The Amerland Group, which specializes in affordable housing across the state but which in recent years has been dogged by legal troubles and accusations of mismanagement and neglect in some of its buildings.

In 2008, company officials also pleaded no contest to criminal charges in Los Angeles for failing to maintain fire safety equipment in some buildings, and earlier this year were charged in the deaths of four senior citizens when fire erupted in the Vallejo building.

Sorrento Tower residents are still eager for the promised renovations. But since talk of C&C Development’s ties to Amerland has made its way through the building’s 198 units since last week, several residents have said the news has dampened their excitement because the apartment building may only be renovated if the building is sold to C&C Development.

“You’ve got two guys who were involved with Amerland and all their dealings,” Jackson said. “I was worried about what conditions would exist here because of what happened with that company.”

The building’s management company has said the potential sale to C&C Development shouldn’t worry residents, because Commercial Facilities would retain the management contract for the building.

Sorrento Tower is owned by the Anderson Foundation, a nonprofit group that developed the building as affordable senior housing in 1976. A 40-year contract from the U.S. Department of Housing and Urban Development provides Section 8 housing subsidies to make the apartments affordable for low-income seniors.

The building is home to more than 200 residents who are either senior citizens or disabled. HUD guidelines cap rent for the studio and one-bedroom apartments at 30 percent of a resident’s income.

But the owner’s contract with HUD is set to expire soon, and the aging Anderson Foundation is not interested in keeping the building and renewing the contract, said Greg Cartwright, senior vice president of Commercial Facilities.

In order to keep the building affordable when the contract expires, the Anderson Foundation must sell the building to a company willing to renew the HUD contract and make renovations to keep the building in good shape, Cartwright said.

He said Commercial Facilities was aware of Amerland’s history, and of C&C Development’s ties to the company, but that neither Rice nor Haeling had been directly implicated in the company’s legal troubles. Therefore, he said, Commercial Facilities determined C&C Development was qualified to buy the building.

C&C Development’s founders, who couldn’t be reached for this story, have said they had nothing to do with Amerland’s troubled projects. But they have used Amerland’s portfolio to burnish their qualifications and, as of last month, continued to use Amerland e-mail addresses.

The company has applied for $15 million in tax-free financing from the San Diego Housing Commission, a city agency that funds affordable housing. The loan would reduce C&C Development’s costs of buying and renovating Sorrento Tower, but the company will have to gain approval from the City Council before getting the money.

The company would keep Commercial Facilities as the property managers, Cartwright said. The Anderson Foundation will not sell the building to any company that does not agree to retain Commercial Facilities as the property manager, Cartwright said, citing the company’s “impeccable management record.”

Residents have voiced other opinions about the building and the management company, including concerns that the emergency alert system — which residents activate by pulling a cord in their bathrooms to alert building managers of an emergency — is only responded to when managers are in the office.

“You can only get sick during office hours,” Cruikshank said.

What they don’t want is for the building to worsen because it is sold to owners with ties to a development company with a troubled record.

“We’re concerned we’ll go from the frying pan into the fire,” Jackson said.

Please contact Adrian Florido directly at adrian.florido@voiceofsandiego.org or at 619.325.0528 and follow him on Twitter: twitter.com/adrianflorido.