A Cooper-Young Development Corporation (CYDC) project to revive a deteriorating stretch of Seattle Street has led to the deterioration of the organization itself.
The 20-year-old CYDC's board has agreed to allow its president, Reb Haizlip, to manage the organization out of existence after the failure of the Seattle Street project and a recent Regions Bank lawsuit to recoup money borrowed for the group's operating expenses.
"When we tie up our loose ends, we'll seek a vote of dissolution from the board. We'll present that to the secretary of state and that will be the end," Haizlip said.
Over the years, the group has developed more than 60 properties in the Cooper-Young neighborhood. Some of those developments were new homes, and others were renovated homes or commercial businesses. When the development corporation was founded in 1991, the Midtown neighborhood was just beginning to bounce back from its reputation as a crime-ridden area.
"Twenty years ago, Cooper-Young was considered somewhat on the other side of safe," Haizlip said.
The group was successful in reviving the neighborhood by growing home ownership and increasing the area's housing stock. In 2006, the CYDC launched the Seattle Street project with funding support from the city and state.
The group purchased 10 properties on Seattle Street, a rundown neighborhood off McLean and just west of the Cooper-Young neighborhood. They built six new homes, but once constructed, they couldn't sell them.
"Our timing could not have been worse. The homes came online just about the time that the real estate market went into its spiraling decline," Haizlip said. "That made it impossible for us to sell. We could not lease them or rent them. It was a tragedy for our organization."
Today, the new homes on Seattle remain empty and boarded. Some of the homes were foreclosed.
"We spoke with our lending institutions and informed them that foreclosure was our only course because we couldn't sell them," Haizlip said. "We thought it'd be better if the homes were back in their hands instead of ours."
Additionally, the group was recently hit with a lawsuit from Regions Bank, which is attempting to recoup money borrowed more than 10 years ago for the group's operating expenses.
For years, the CYDC paid small amounts to satisfy the interest on the uncollateralized loan, and eventually the board created a fund to retire its debt.
"When the real estate market got to the point where we couldn't sustain our operations, we began tapping into that fund which we created to buy back the debt," Haizlip said. "In the end, they sued us for the money, and the board elected the suit to be won. That election effectively terminated our ability to operate."
The CYDC recently sold its old office building on Cooper Street to the Cooper-Young Community Association.
Despite the group's post-recession financial woes, Haizlip hopes residents will remember the good things the group did to rehab the Cooper-Young Historic District.
"This was the first group of developers in the neighborhood. These were pioneers. These were the people who bought really derelict homes and brought sweat equity and money into them," Haizlip said. "These are the people who brought the neighborhood back, and I think the organization deserves a lot of credit.