Mark Hayward's City Matters: No certainty, but plenty of potential at Granite SquareBy MARK HAYWARD
New Hampshire Union Leader
December 19. 2012 11:16PM
For now at least, John Cajigas is staying put.
Cajigas, an unemployed mason's helper, will accept the quirky nature of the electrical connections in his apartment, a collapsing porch ceiling, the missing gas-fired heater, and the general shabbiness of the four-family property on Granite Street where he lives.
After all, he hasn't paid his $200 weekly rent bill since spring. And although repairs aren't taking place, he keeps his apartment warm and clean for his family of three.
"I wish I had a better place, but I'm not moving to the east side at all," Cajigas said in his kitchen, which is warm thanks to the gas stove but rather dim because the ceiling fixture doesn't work.
Meanwhile, Cajigas' de facto landlord, Fred Santucci, hopes that real estate values and rents will rebound; that Granite Square - a tightly congested area of apartment buildings, small yards and narrow streets - will undergo a renaissance. And he thinks that the property, which he currently lacks title to, will eventually house happy, rent-paying families.
Well, 'tis the season of Santa Claus and wishes that might come true.
"These properties are lost to everybody," Santucci said during a telephone conversation from his home in Needham, Mass. "Somebody's got to pay the taxes and spiff the property up."
In September, I wrote about 459 Granite St., one of three city properties that are falling back into Santucci's lap. He had owned the properties and sold them to a limited liability company in 2008, but self-financed the sale. The new owners collected rents for a few years, let the properties deteriorate and abandoned them earlier this year.
"There's a lot of situations like this," said David Albin, who oversees the city's apartment inspection program. "A lot of these properties are upside down. The owner has walked away. There's a bank in Texas, a bank in California, no local property manager."
They ignore complaints about code violations, Albin said. No one shows up for inspections. Official city notices return undeliverable.
City records show 77 landlords with unpaid fines that his department has turned over to collections, a sign that the landlord has abandoned the properties. Some still have tenants. Some people live in apartments without electricity, he said.
"They owe the city thousands of dollars in back taxes. What do you do? I'm at a loss," Albin said.
In this case, the bank is Santucci, who issued a $300,000 mortgage when he sold the properties to CGL Properties LLC.
"I look at the property now, and I remember the way it was when I owned it, and to see it now, it's a shame," Santucci said. He denies any knowledge that the property lacks a certificate of compliance, a permit that allows a landlord to rent property, and says the property meets minimum health and safety standards.
Santucci said he can't put a lot of money in the property now.
For one, he doesn't own it.
For another, it's questionable how economically feasible it would be to do so. Back taxes and sewer fees on Granite Street alone amount to $37,800 - 17 percent of the property's tax value.
With the mortgage in default, Santucci has the right to collect rents. But that's not happening.
In April, he lost rent from the second-floor apartment of Gail Lambert. The Manchester Housing and Redevelopment Authority terminated its contract with CGL because of several deficiencies, including a loose ceiling fan and problems on the back porch, which include a collapsing ceiling, questionable floor boards and failing joists.
The Housing Authority paid $801 a month for her apartment, Lambert said. Three months later, Lambert stopped paying her portion of the rent, $59.
Since then, Lambert said she can't get Santucci to sign paperwork to vouch for her residency and rental expenses. That means she's lost a $150 Medicaid check to cover her health insurance and $130 in food stamps. A state human service official said they follow the federal rules in such an instance.
"It's a Catch-22, but it's not like she's without the resources," said Terry Smith, who oversees family assistance programs for the state, and spoke in generalities. "If the client is not paying rent, they don't get the rental deduction (on the eligibility form)."
Lambert, 54, complains of numerous medical conditions - hernia, nerves, arthritis and auto-immune disorder. She is frail and speaks in a gruff, jittery voice that becomes emotional at times.
"I might be poor, but this is my home. This is where I live," she said. Lambert has tried to move elsewhere, but an opportunity in Massachusetts fell through when that apartment did not pass inspections. Then a second opportunity - to move to an apartment next door - went up in smoke last month when a fire badly damaged the building.
"I'm basically looking at homelessness," Lambert said.
This fall, a second tenant, Norm Johonnett, moved his family out of 459 Granite St. He moved to the building next door and was displaced by the fire within several weeks, Lambert said.
That leaves Cajigas. Santucci has sued Cajigas for back rent, which he claimed amounts to $4,400. Santucci missed the first trial date in October. On Nov. 14, a judge threw the case out, ruling that Santucci had not given proper proof of rental demands from Cajigas.
Santucci said he has properly served papers this time and will resume the court process.
"It's a very difficult thing, when tenants are working against you. They take control; they do what they want to do," Santucci said. But he said he is friendly with Cajigas, and he would not want the building totally vacant if he started to restore it.
He estimates it will cost $25,000 to $50,000 to restore the property.
As for Cajigas, he said he hasn't been able to find work lately, so he plans to stay put. The electricity and gas bills are high - about $420 a month combined - because the apartment lacks a standalone gas heater in the living room, he said. But he balances that against the rent he's not paying.
He's worried water might get shut off, but if it does, he'd pay it. (The water bill is current, according to Manchester Water Works.)
Cajigas said he would resume paying rent if Santucci installs a heater; Santucci said he's never heard such an offer.
Santucci said urban blight is the issue, and blames the bad economy, drug dependency, and a culture that does not encourage young adults to be responsible.
If both agree on anything, it's the potential for the property, despite its condition. It is sided with unsightly gray asphalt shingles. Attempted foundation repairs have left a 5-foot-deep trench beside a small portion of the cellar. And in September tenants complained about rotting floor joists, poor heat, a hole in the floor in one of the vacant apartments, and the apparent cross-wiring of outlets between apartments.
Cajigas said he could see himself owning the property, and wondered what happens when the city takes it over for non-payment of taxes.
He said he could pay the taxes and upgrade it.
"This place," he said, "has a lot of potential."
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Mark Hayward's City Matters appears in Thursday editions of the New Hampshire Union Leader and UnionLeader.com. He can be reached at email@example.com.