MV Savings begins foreclosure of Bradley Square property
Martha's Vineyard Times File Photo
The Martha's Vineyard Housing Fund is sending an urgent appeal to donors this week, after announcing the Martha's Vineyard Savings Bank began foreclosure proceedings on the Bradley Square property in Oak Bluffs.
The fund, formerly called the Island Affordable Housing Fund, intended to develop the property into affordable housing, a sanctuary, office space, and retail space, but fell far short of raising the $1.3 million necessary to build the project. The fund put the property on the market in September of 2010.
The bank also froze all of the fund's accounts with that institution, both operating and restricted, on June 15. The bank's action leaves the fund with no liquid assets, and scrambling to raise money quickly, in order to pay the rent, salary, and other overhead necessary to keep the organization's doors open.
"If we can't raise immediate funds in the short term, a matter of days, less than a month, then we won't have any operating capital to continue," executive director Ewell Hopkins said. "We won't be able to meet our monthly obligations, forget our advocacy role, or our fund raising role. We won't have an option. This is the fieldstone around our neck."
The fund has nearly $80,000 in accounts at the Martha's Vineyard Savings Bank, more than the amount it is behind on the Bradley Square mortgage. Last fall, the fund's board of directors decided it would not go forward with the Bradley Square project, and voted to stop making payments on the $760,000 mortgage. The group notified its bank that it expected to sell the property and repay all of the debt.
Donations in the bank's accounts were earmarked for operating expenses, and for other housing initiatives.
"We weren't given money to cover our obligations to the bank for Bradley Square," Mr. Hopkins said. "It's for other projects. The fund board decided not to continue to pay the mortgage when it was decided we weren't going forward with Bradley Square. We still own the property, and are still talking about to buyers about selling it. We still could preempt foreclosure with an offer."
The fund is also behind on a loan of $52,000 from the Jenney Way project in Edgartown. The fund elected to accept a "short sale" for the one market rate home it owned in that development. The sale price of the home was less than the amount owed, and the fund took out a loan for the difference.
John Early, chairman of the Martha's Vineyard Housing Fund board of directors, said the organization still fills a critical role for the Island, a role no one else is filling.
"Sombody's got to do this," Mr. Early said. "Nobody is stepping up."
Mr. Hopkins said he is optimistic about the future of the fund.
"We have very low cost of operations, and we will continue that way," Mr. Hopkins said. "If we do incur costs, they will be tied to a specific project. I think the viability is as strong as the commitment is in the community to addressing housing. We have a huge advocacy role to play as well as a fundraising role."
He said while not disapproving, he was disappointed in the level of commitment from the NAACP of Martha's Vineyard, and other local organizations.
"Clearly I'm disappointed in the outcome and clearly I'm disappointed that the level of enthusiasm around Bradley Square seemingly has dissipated," Mr. Hopkins said. "There was so much momentum behind this initiative from so many different components of the community. People have refocused their attention in other directions."
Mr. Early spoke regretfully about the failure of the Bradley square project.
"If the economy hadn't tanked, I think there would be people living there now," Mr. Early said.
The fund, purchased the Bradley Square property at the corner of Dukes County Avenue and Masonic Avenue in 2007, with the intention of building affordable housing, retail space, and preserving the building which once housed the Island's first African-American church. After a grueling permitting process before Oak Bluffs town regulatory boards and the Martha's Vineyard Commission, a national recession triggered severe declines in charitable donations. Unable to complete the project, the fund put the property on the market in September of 2010.
Both Bradley Square and Jenney Way were ill-fated departures from the fund's traditional role as strictly a fundraising partner for the Island Housing Trust, the Dukes County Regional Housing Authority, and other housing causes. In both of those projects, the fund borrowed money to buy and develop the properties. Both proved to be financial burdens.
"We're certainly not going to get into the real estate business," Mr. Early said. "That's a given. There was such a complete sea change in the whole economic situation."
In 2010 the fund reorganized its board of directors, revamped its bylaws, and dramatically reduced expenses. Two staff positions were eliminated, leaving Mr. Hopkins, the executive director, as the only employee. The group also steered away from flashy summer fundraisers.
"We are absolutely bare bones," Mr. Early said. "One of the fundamental problems the effort had before was spending too much money to make money."