When word spread at Tel Court last fall that an agent for the owners had offered tenants a chance to buy the buildings before they were sold to an outside buyer, residents of the small Southwest Washington apartment complex were puzzled.
Along with its several dozen regular tenants, Tel Court also housed 15 "deed holders" - families who in the early 1950s began to buy shares in the buildings and who were themselves part-owners.
"To say that the [the agent] created a confusing situation," said one South-west community organizer, "is putting it mildly."
But now, many months, meetings, fund raisers and sleepless nights later, the tenants and deed holders finally have joined forces to buy the 58-unit complex and convert it into a full-fledged cooperative. Tel Court is located at Half and O streets SW, a few blocks from the Department of Housing and Urban Development and across the street from the town house rented by city housing director Robert L. Moore.
With the help of community groups and the public and private sectors, the residents signed a contract and are on the verge of settlement - an unusual feat for families whose incomes range from only $2,600 up to $20,000 a year.
Now, said Tel Court tenant Louise Freeman, her worries about eviction may soon be over. "I worry about displacement constantly," said said Freeman, who is retired. Hopefully, she added, "This will stop that."
The Tel Court effort is part of a growing movement by tenant organizations in the city. Instead of reluctantly moving out when the first-right-of-refusal letter or the notice of condominium conversion arrives, some groups are staying and trying to buy their buildings and operate them as cooperatives or condominiums for existing residents.
In some cases, they are getting financing for hundreds of thousands of dollars an accomplishing what many people thought impossible a year ago.
Itenants at Beverly Court in Adams-Morgan have purchased their building. So have the residents of the Kenesaw in Mount Pleasant. Tenants at the Beecher street apartments in Glover Park, at McLean Gardens on Wisconsin Avenue and at Bonwit Plaza in Foggy Bottom are trying to do the same.
"The whole cooperative movement in D.C. is really going to take off," said Alice U. Vetter, executive director of Ministries United to Support Community Life Endeavors (MUSCLE), the Southwest organization helping the Tel Court tenants. "There now is a cadre of people getting the know-how on this. People are talking and meeting together."
The Tel Court tenants have worked out an arrangement that will allow tenants and deed holders to remain.They will pay $277,200 as the purchase price to the Tel Court owners, and an additional $127,500 to the 15 deed holders for their "share" of he building.
The deed holders then can pay off their loans for their loans for their units and have a small profit left over, according to Vetter.
A $500 price tag was established for a share in the new cooperative for tenants. Several churches that are part of MUSCLE donated money, with St. Dominic's contributing $3,500 for a revolving loan fund at no interest, Vetter said.
Perpetual Federal Savings and Loan has committed more than $500,000 for permanent financing. The savings Associations Financial Enterprises Inc. (SAFE) will provide interim acquisition and rehabilitation funds.
The city's Department of Housing and Community Development will help tenants who need down payment assistance. In addition, Vetter paid, the tenants hope to get subsidy help from the U.S. Department of Housing and Urban Development.
Some of the sources that Tel Court Residents are tapping have never been used for cooperatives, Vetter said. "We're really plowing a lot of unplowed territory," said Vetter. "We have to come up with a monthly housing cost that everyone can afford."
On March 8 the tenants signed a contract to purchase Tel Court with Robert G. Weightman, the representative of the Tel Court owners. With he help of University Legal Services attorneys Jerry Dobson and Terry Mills, they got an advisory opinion from the city's Rental Accommodations Office saying they were entitled to at least 60 days settlement time. Weightman recently agreed to extend settlement until June 5.
Residents of Tel Court said their project is a pleasant place to live and houses many relatives. Neighbors play checkers or dominoes until 8 or 9 p.m. and "shoot the breeze" in the afternoon, according to longtime resident John W. Henderson.
Henderson and his wife, Betty, who are deed holders, live two buildings away at Tel Court from their grand-daughter and grandson-in-law, William and Pinky Coates, who are tenants. They all plan to stay when Tel Court becomes a cooperative.
Henderson said he was glad to purchase a share in Tel Court for $7,000 in 1950 because he was having a hard time finding a place to live. He paid only $69.75 a month until last year, when his payment was raised to $90.
Henderson was told he would have his loan paid off by the time he was 65, he said. But he is 73 now, and still owes money on that original loan.
The owners of Tel Court "weren't charging enough per month," noted Dobson. Their payments only covered operating costs, but they thought they were paying off their mortgage, principal, and interest. They were owners living like tenants, paying the owners' operating costs."
Coates, a Fairfax County fireman, said he had searched Southwest, Northwest, Capitol Hill and Upper Northwest for a home that he and the Hendersons could buy and share.But he found sellers asking from $55,000 up to $100,000, he said. That, plus the fact that town houses across the street in Southwest now cost $110,000, led him to believe he'd be better off at the Tel Court cooperative.
"A cooperative makes us like an owner," Coates said. "It's like a steppingstone."
Weightman, the representative of the estates of the Tel Court owners, said the apartments at the complex were leased to deed holders in the early 1950s. It was a unique operation that required only about $150 as a down payment, he recalled.
But the Tel syndicate, which held first and second trusts on the units, regained control of most of the apartments over the years through "friendly foreclosures," Weightman said. "Some of the people didn't realize they had legal title and walked away," Weightman said. "Others defaulted on thier payments."
A single purchaser last year offered cash for the units the syndicate had repossessed, Weightman said. "I think he wanted to hold onto them for a year or two and then turn them into condominiums," he added.