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Arizona Tenants Advocates » 2009» March

Archive for March, 2009

Trigild Blocking Bethany Purchases

Thursday, March 19th, 2009

Arizona Tenants Advocates (ATA) has learned that Trigild, Inc., which is the receiver for the Phoenix area Bethany Group apartment complexes, is said to be intentionally dragging its feet at finding a purchaser for the properties.

A confidential source has told ATA that Trigild’s president, William Hoffman, is blocking purchase of the entire inventory of properties, numbering about 58 nationwide, in an effort to optimize the selling price by way of locking in contractual obligations to staff at the complexes and recruiting as many new lessees as possible. Any bidder would be beholden to honor the obligations, and thus underwrite them by way of an increased bid. Also, the ante would be raised by supposedly better prospects for rental income.

Instead, Hoffman’s actions are actually degrading the rental communities further, due to the lack of closure about who the owner will ultimately be, and absence of capital infusion to right the sinking Bethany ship. ATA has over the past several days noticed an increasing stream of renters calling our office who just want out. They are fed up with these shenanigans.

The source has conveyed that Hoffman’s office is playing games with parties interested in purchasing the Bethany package, and is not even returning telephone calls to serious players. ATA was told that anyone expecting to make real progress towards purchasing the properties is going to have to bypass negotiations with Trigild, which is not acting in good faith.

This bad faith is further evidenced by the fact that apartment complexes under Trigild’s umbrella are continuing efforts to sign up new tenants. Generally, that would be a positive. But in this case, it is doubtful that prospective tenants are being told the whole story about the bankruptcy and possible foreclosures of the Bethany properties. ATA would be interested in hearing from tenants who have experienced such deception.

Further, Trigild has said it will not honor the law by returning security deposits to Bethany Group tenants. First, on March 6, 2009, its agent at The Coves at Newport, Cameo Dawn, publicly acknowledged that tenants would not be getting their security deposits back. Next, this was corroborated in a March 16, 2009 article on MSNBC.com, entitled “Corporate meltdown leaves renters in limbo,” http://www.msnbc.msn.com/id/29697413/ wherein Hoffman is quoted, “There is no obligation for the receiver or the lender to give (tenants) deposits that they don’t have.” If the deposits had been handed over to Trigild it would be different, he said, “but that owner (Bethany) has obviously spent that money or done something with it.”

This is in blatant violation of the statute governing return of security deposits and prepaid rent, A.R.S. § 33-1321(H), whereby “The holder of the landlord’s interest in the premises at the time of the termination of the tenancy is bound by this section.”

Clearly, Hoffman wants to operate his little Phoenix kingdom as a petty dictator, but refuses to accept fiscal responsibility for it. The course of events indicates that Hoffman is merely out to line his pockets at the expense of the same tenants who have already been fleeced by Bethany Group’s Greg Garmon.

At this rate, the former Bethany properties look increasingly likely to be emptied out and boarded up. Repeatedly, at meetings at The Coves at Newport, Riviera at 7th, and Alante at the Islands, tenants have voiced to me that they do not trust the prior managers, and that they will not stay if prior managers are kept on.

Yet, instead of listening to the tenants, Hoffman has sought to muzzle them. The result? They continue to express themselves by walking away from the properties. One tenant at Alante at the Islands today told me that the entire complex is now like a ghost town.

Verily, who in his or her right mind would want to live in places like these? The acrid stench of ego and corruption underlies the structural decomposition.

Selfishness and self-aggrandizement is what got us into this mess, and now perpetuates it. Trigild’s Hoffman should be booted out as receiver, because he is only a taker. And the tenants who have inhabited the former Bethany Group properties have already been taken to the cleaners. They deserve better.

- Ken Volk -
March 19, 2009

Bethany Under Water - And Without Water

Sunday, March 8th, 2009

The foreclosure contagion is spreading.  This morning, Arizona Tenants Advocates (ATA) was exposed to the wrath of innocent tenants who have been infected.

The Bethany Group, one of the nation’s largest multi-family rental real estate companies, has flat lined.  Based in California, its CEO, Greg Garmon, has fled the scene, leaving behind tens of thousands of tenants living in shambles.  All local Bethany Group properties are in court receivership under the auspices of bankruptcy, with foreclosure a likelihood for those communities unable to be sold in the interim.

Tela Verde Apartments, in Glendale, faces a water shutoff March 11, 2009.  The pool at Alante at the Islands, in Chandler, is pea green, and weeds everywhere are overgrown.  Office staff at all complexes have not been paid in over a month.  The offices are closed.

Multiply this by thirteen apartment complexes in the Valley, and you have a fair idea of how around 20,000 individuals may find themselves facing a Phoenix summer out in the hot, looking for new housing.

Today’s meeting, at The Coves at Newport, 5205 W. Thunderbird Rd., Glendale, drew about 200 concerned and irate residents.  Several television stations were present.  Tenants asked about utilities and repairs, rental payments, whether they would have to leave soon, and if they could leave soon.  Many were just fed up.  They had all paid rent, but Bethany Group skipped out on its fiduciary duty to transmit the monies for its mortgage, taxes, utilities, wages and upkeep.

One website posting charges that Garmon had risked tenant monies investing in Russian oil.  Apparently, at this juncture he is nowhere to be found.  I suggest searching in Crawford.

Repeatedly, tenants voiced frustration at having to go through legal procedures to terminate, when clearly Bethany had failed to fulfill its legal obligations.  Ken Volk, ATA’s president, explained that any new owners could choose to enforce the lease, or if the property is foreclosed, to void the lease on very short notice.  In order for tenants to terminate, it would be necessary for them to issue noncompliance demand notices, and then await whether management would comply.  Volk cautioned that everything must be documented, at each step of the way, including vacating and delivery of possession.  Other tenants asked about security deposits, which are likely lost to the wind.  But Volk stated that it would be essential for every tenant to demand the deposits, anyway, because it puts management on a 14-day time constraint to reply with any deductions or claims.

Suddenly, up chirped manager Cameo Dawn, announcing that 707 Management, out of Las Vegas, was now running The Coves at Newport.  She said that the office would be open hereafter, that the water would not be turned off, and that repairs and maintenance would be brought current.  The existing staff had been hired by new management.

Thank you, Cameo, for that performance.  Now we can all go home, knowing that we can trust you to perform all the repairs that have been so neglected for so many months.  You have turned a new leaf, or at least we saw the face you chirpingly presented.  She even welcomed Arizona Tenants Advocates to the complex, but as she turned away tenants conveyed that her other face was dissing.  Quite the diss and tell.

Most tenants were very skeptical that anything good would come about.  They complained about the mold and leaks that have been consistently ignored, constituting a health hazard.

At least some matters were clarified.  Contrary to news reports, Cameo acknowledged 707 Management is not purchasing the property.  She stated that the property would likely be in receivership for years to come.

So what else is new?  Perhaps the other high-heeled shoe is about to drop.  Is 707 Management just another Las Vegas gamble about to hit the skids row?

- Ken Volk -
March 8, 2009