PHA will have to relocate residents to repair Brith Sholom House

The residents of Brith Sholom House, a Wynnefield Heights senior apartment complex, spent much of the last year organizing to save their homes.

In August, it seemed as if they had won: The Philadelphia Housing Authority (PHA) stepped in to purchase the building for $24 million from foreclosure after its previous owner allowed it to fall into ruin while pocketing rent and utility payments.

But Tuesday afternoon, PHA president Kelvin Jeremiah told residents that they would have to move out, as the building is too ravaged by neglect to allow for the tenants to remain as it is repaired. Instead, the agency will have to do a gut rehab of the building to make it livable.

“The conditions are worse than we anticipated. It’s horrifying that residents were made to live under the[se] conditions,” Jeremiah said. “The disrepair, in a word, is astonishing.”

» READ MORE: Empire of Neglect: How the Puretz family cashed in while poor renters paid the price

Jeremiah said that PHA would guarantee the residents’ right-to-return and that the agency would cover costs associated with moving out and, eventually, moving back in. The gut rehab of the building would take 18 months. He also said any rent residents have paid to PHA in the past few months would be refunded.

He said tenants would get help finding new accommodations in the Wynnefield Heights neighborhood, if they wanted to stay there, either in PHA-owned units or with private sector units that could be obtained with the help of housing vouchers.

Jeremiah noted that while originally some residents of Brith Sholom House had incomes too high to be eligible for PHA subsidies, anyone who had the resources to move has done so. He estimated that about 111 residents are still living in the 360-unit building.

For residents the idea of finding new accommodations is devastating.

Yolanda Lee, whose mother Gayle Lane, 83, has lived at Brith Sholom for 13 years, said she was distressed and worried by the news “dumped” on her family two days before Thanksgiving.

”It’s very disruptive. I have no idea what’s going on, where are these places going to be located. It’s not a good thing at all,” she said. “We thought we had negotiated it to the point where it’s semi-settled. Now we’re not feeling it at all.”

She said her mother is frail, and Lee is concerned about how she’ll be affected by the forced displacement. ”And if it’s impacting my mother, who has me, I’m sure it has a greater impact on other people who don’t have anyone.”

At PHA’s August board meeting, Jeremiah said the cost of acquiring the building would be $67,000 per unit — not including renovations. At the time, they anticipated the rehab to cost $30 million to $40 million.

Now PHA says the necessary renovations are so extensive that the costs will almost triple to $112 million. Jeremiah also said that some of the units were beyond repair, so the overall apartment count would be reduced to 335.

There are also concerns that some senior residents may not live long enough to move back into the rehabbed building.

Jeremiah said that he understood such fears, but that he applied a simple test to such buildings: Would he want his mother living there?

“It absolutely hurts my heart that in the case of Brith Sholom the answer is a resounding no,” he said.

The saga of Brith Sholom House’s catastrophic neglect began with the building’s purchase by the New Jersey- and New York-based Puretz family, three members of which are now facing criminal charges.

The family had a pattern of buying aging affordable housing complexes, taking out large loans — in some cases, by deceiving lenders about the value of the property — then defaulting on them, while also siphoning away residents’ utility payments and laundry machine cash. They also slashed maintenance contracts, allowing their buildings to fall into disrepair.

An Inquirer investigation this year identified more than 16,000 apartments in 21 states owned by Puretz companies, burdened with more than half a billion dollars in debt. Their tenants, many of them elderly and disabled, suffered the consequences.

One renter died in a baking-hot apartment, and another fell down an elevator shaft. Others were sickened by mold and left without heat in the coldest months of winter. Cities across America have paid tens of millions of dollars to relocate tenants or to prevent utility shutoffs.

Philadelphia leaders have been aware of deteriorating conditions at Brith Sholom for well over five years, but only sought to place the building into receivership last year. By then, the building’s former owner — who recorded a $36 million mortgage on the property around the time ownership was transferred to the Puretzes — had filed for foreclosure on the 11-story senior tower.

The Inquirer investigation raised questions about that mortgage, which was signed by a now-deceased resident of Brith Sholom who was in her 90s but was listed as “president” of the company on the loan document.

The building was placed into receivership. But conditions only worsened according to tenants, who described leaks, mold and pests in their apartments, frequent heat and elevator outages, and retaliation for their advocacy. Jeremiah said PHA found sewage leaks in parts of the building and a rampant bedbug infestation.

In August, PHA lined up state and federal financing to save the building. Jeremiah told the authority’s board that the “incredible acquisition” was “a deal.”

On Tuesday, Jeremiah said that PHA would do everything in its power to ease the transition and ensure that any tenants who want to, or are able to, can move back in when repairs are complete.

“These residents have been my heroes, they have fought a good fight,” Jeremiah said. “They have gotten us to acquire the property, and now I want to provide them with a good, safe, decent, safe, affordable place to live. They have a fundamental right, after the relocation is done...to return to the fully rehabbed building.”