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Quarterly Report

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Quarterly Report Inventory Department 1 The Inventory Department is responsible for the management of all properties while in Land Bank ownership. This includes the acquisitions of property by the DLBA, whether from private or public sources, as well as the physical maintenance of the property. The Inventory Department is responsible for the assessment and placement of inventory into “pipelines” including Demolition, Legal (Quiet Title), and Dispositions sales programs. The Inventory Department supports DLBA programs with data analysis and ability to sort and map all properties by type, location, condition and other factors. It also provides assistance to the City’s economic development efforts. Future Inventory programs may include data analysis and support to the City for land assembly, whether for Blue/Green Infrastructure projects for storm water management, economic development, or another use. Inventory Management As of 01/06/2017, DLBA holds title to 93,195 parcels. Residential Vacant Commercial and Industrial Grand Structures Land Structures Total In HHF 15,833 43,992 258 60,083 Outside HHF 10,772 22,285 55 33,112 Grand Total 26,899 66,277 313 93,195 The Inventory Department continues to receive and respond to many property maintenance requests, including weak and/or dead trees, overgrown lawns, and unsecured houses. As always, we are balancing the immense amount of requests with our current resources to handle as many resident concerns as possible. The Detroit Land Bank Authority is preparing a Tree Removal RFQ to manage the removal and cleanup of dead trees on DLBA properties. The Detroit Land Bank Authority will be reissuing the Property Maintenance and Preservation Professionals RFQ during the first half of 2017. Currently, the Detroit Land Bank Authority (DLBA) continues to use normal or black colored plywood, and SecureView (plexi-glass system) as its way of securing the windows and doors on its properties. The DLBA has become very innovative in its approach with the use of plywood to ensure the most effective methods are used when securing a property. The average cost for board ups are $35 per window and $75 for a doorway. Pipeline Management Acquisition Inventory Department staff have completed the first two of four phases of the reconciliation property transfer with the Planning & Development Department. In mid-November, the Inventory Department staff worked closely with their counterparts, Planning & Development and Housing & Revitalization Departments to release ninety- four (94) commercial parcels to the Planning & Development Department to resolve 2 outstanding title issues. Staff completed this exercise in order to ensure that the Planning & Development Department retains marketable title, so that they can return these parcels to productive reuse expeditiously. Towards the end of November 2016, the Inventory Department staff completed the transfer of 507 parcels from the Planning & Development Department to the DLBA. These were properties that had previously been approved for transfer by City Council. In the coming weeks, the Inventory Department staff expect to complete the final two phases of the reconciliation transfer with the Planning & Development Department. By the end of January, staff expect to transfer approximately 600 additional residential properties from the Planning & Development Department to the DLBA, all with existing Council approval. At the conclusion of this step, staff will work with the Law Department staff at the City of Detroit, to execute a small corrective transfer of commercial properties erroneously transferred to the Land Bank previously. This final step should be completed in February. The Inventory Department staff are also anticipating a transfer of approximately 6,689 properties to the land bank from the Wayne County Treasurer’s office by the end of January. These unsold 2016 tax foreclosures include approximately 5,536 residential structures and 1,153 vacant lots. Beyond these inter-governmental acquisitions and transfers, the Inventory Department staff remain diligent in their efforts to accept property donations from financial institutions and individuals. Since October 2016, the DLBA acquired approximately 10 properties as either private or bank donations, with approximately 60 additional properties currently under review from private residents and approximately 10 more from financial institutions. Auction In 2016, the Inventory Department staff identified 390 unique properties to be sold through the auction, with a total of 769 attempted or completed auction sales. Sometimes properties fail to sell, or fail to close. When this occurs, the property is relisted to provide an opportunity for someone to purchase the home. Currently, there are 287 properties in the auction pipeline. We anticipate receiving an additional 200 auction properties via Wayne County Treasurer’s unsold 2016 tax foreclosures. These additional properties will be surveyed for condition and occupancy, then the Inventory Department staff will work to obtain insurable title prior to putting the properties up for auction. The Inventory Department also continues to review market conditions and identify additional auction properties located in areas where the market has improved. 3 The DLBA team of building inspectors have finalized the Scope of Work and Property Condition Report, which will provide an estimated minimum cost of repairs for each auction property and what repairs should bring the property up to city code. The Scope of Work will provide buyers with a more detailed overview of the estimated repairs, and serve as a document that buyers can use to obtain bids from contractors. Own It Now Over the past year, the DLBA has ramped up the number of properties listed for sale through its Own It Now portion of the auction. Unlike houses sold through the live auction and Rehabbed & Ready, Own It Now properties are not cleared of debris, have no open house, and the title is not made insurable prior to sale. However, buyers do have the option of viewing the properties through private home viewings and pursuing title services through the DLBA after sale, for additional fees. This has allowed the DLBA to quickly dispose of vacant and salvageable houses in its inventory, while effectively responding to citizens’ requests to purchase and renovate DLBA owned properties. The Inventory Department staff have listed the following number of properties on the Own It Now portion of the auction website each month since ramping up the program in March 2016: Month # of OIN Properties Listed March 59 April 74 May 80 June 87 July 105 August 103 September 131 October 178 November 145 December 126 January (Projected) 190 Total 1,278 4 Number of OIN Properties Listed by Month 200 100 0 # of OIN Properties Listed # of OIN Properties Listed Eighty-two percent (82%) of the properties listed on the Own It Now website since March were requested for sale by a member of the public. We are presently making approximately 40 houses available for sale each Monday, and there are currently 476 houses available for sale on the Own It Now site (as of 1/5/2017). If a property fails to sell on the Own It Now website, its price will be reduced, and ultimately the property will be reassessed for demolition, or disposition by another means. Side Lots The Inventory and Dispositions Departments completed two rounds of re-notification of residents to buy the side lot(s) adjacent to them. In the third and fourth quarters of 2016, staff re-sent a postcard to every prospective side lot purchaser in the city, and also subsequently sent a postcard to their taxpayer address, if it differed from the address of the home adjacent to the lot. In November, the Inventory Department staff identified 4,903 additional vacant residential lots newly eligible for the side lot program. The 4,903 properties have been listed for sale on BuildingDetroit.org and 5,104 postcards were sent to eligible purchasers. This offering of newly-eligible Side Lots brought the total number available to more than 30,000. After accepting the transfer of the unsold 2016 foreclosures from the Wayne County Treasurer’s office and the final remaining transfer of parcels from the Planning & Development Department, staff anticipate offering an additional round of new Side Lots in February, 2017. While concrete numbers are unavailable at this time, the DLBA expects this offering to be approximately 3,000 lots. The Inventory Department has also completed a thorough analysis of accessory structures in its inventory, and identified 533 garages, sheds, and other accessory structures that appear to be in use by an adjacent neighbor. Staff have begun coordinating with the Dispositions Department to develop a strategy to dispose of these properties. 5 Demolition Department 6 In the 4th quarter of 2016 the DLBA, in cooperation with the Michigan State Housing Development Authority (MSHDA) developed new demolition procedures. These new procedures are in place and fully operational. One of the new procedural steps is to conduct a cost reasonableness estimate on each property before its release and those prices will be matched against the bids when received. Any estimates or bid responses that fall outside the reasonableness range will be sent to the Approval Committee for an in-depth review. The Approval Committee has been formed with a representative of the DLBA, DBA, and City’s Chief Financial Office and they are meeting on a weekly basis. Upon receipt of bid responses the Committee reviews those bid results where the total demolition cost on any given property exceeds $35,000. It also has been reviewing any properties where the reasonableness estimate exceeds $35,000. The DLBA has welcomed a MSHDA staff member in our office 3 days a week who attends staff meetings, assists with process improvements, and troubleshoots matters as they arise. The MSHDA and DLBA demolition teams are working very well together and feel confident in the new process improvements. The demolition team is working diligently with contractors to ensure the proper submission of invoices.
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