WPCNR COMMON COUNCIL-CHRONICLE EXAMINER. October 4, 2006: The city approved a 20 year lease with a newly formed subsidiary of Related Apartment Preservation, LLC, known as Armory Plaza Preservation, which will pay Armory Plaza Preservation $264,000 a year for rent on the senior Center in the Armory building.

 The Mayor in his remarks stated that the city action preserved the 52 units of senior housing there, because the organization has lost its funding and the units would have to close, while also assuring that $2 Million in improvements would be made to the Armory building by the new owner.

What has happened as stated in the work session when this lease was discussed is that Related Apartment Preservation has been charging rents over and above guidelines HUD has established and the Housing and Urban Development department has decreased the Related Apartment Preservation rents.  Related Apartment Preservation had asked the city to make up the rent loss difference dictated by HUD surveys of typical rents,  in the September work session.

Here's the story from HUD:

Andrew Glantz, spokesman for HUD told WPCNR last week that Related Apartment Preservation had been charging $1,087 a month for its 13 efficiences (of which the elderly tenants pay one-third), and HUD demanded Related lower that rent to $925. Glantz said the average decrease was $146 a month, which cost Related Apartment Preservation $1,898 a month in rent or $22,776 a year.

Glantz reported to WPCNR that of the 39 one-bedrooms, Related Apartment Preservation had been charging an average $1,306 a month, and HUD has forced Related to lower that rent to $1,215, a decrease of $91 a month. That works out to $3,549 a month in rent shortfall or $42,588 a year.  The total rental shortfall, according to the figures Glantz supplied on the individual apartments totals $65,364. The city had been paying Related $125,000 a year for rent on the senior citizen center in the Armory. Related wanted the city to up that rent and also take care of a portion of the rent loss demanded by HUD.

Tonight's lease does more than that. The city is more than doubling its annual investment with Related's new subsidiary Armory Plaza Preservation. The city will pay $264,000 a year over 10 years for the lease of the senior center, with renegotiation at that time.

No explanation was given at the council proceedings Tuesday evening of the justification for the more-than-double increase in the amount of rent the city will now pay for the Senior Center.