The director of the maligned D.C. Department of Housing and Community Development has testified that he wanted the city to take over the loan of a troubled housing project and try for a third time to convert it into low income housing.
John Hall told the D.C. council Committee on Housing and Workforce Development on Monday that his agency planned to underwrite — again — a project on 1300 Congress Street SE. Hall said the District has $5.5 million invested in the project from a previous venture with the nonprofit anti-gang violence group Peaceoholics. After the Peaceoholics project failed and the group defaulted on its loan, the property went to developer Richard Hagler. According to Hall, Hagler is now at risk of default on his $1.6 million loan, putting the property at risk of foreclosure again.
"The department is going to underwrite the project to see what we can do to reposition the debt," Hall said. "[We want to] find the financial resources to pay off the first lender. Then we will seek a reputable property management company... to run it."
Hall also said Peaceoholics was part of a "pilot demonstration project," which under the previous director mean the project was not competitively bid nor subject to the same level of vetting that competitive projects are. He said under the Gray administration, pilot demonstrations will be subject to the same scrutiny that competitively bid projects are.
The apartment building, which is still empty, was supposed to be low-income housing for at-risk youths coming out of the city's foster care system.