RALEIGH — For $459 a month, Polly Johnson rents a two-bedroom apartment at Washington Terrace home since a tornado wrecked her house in 2011.
She shares the apartment with her 77-year-old husband, Robert, a retired New York policeman who uses a wheelchair. Its not perfect, but its an affordable set of roof and walls.
On Thursday, Johnson learned that her modest development in Southeast Raleigh small multi-family homes spread over several blocks is for sale. Its described as an exclusive listing in a 57-page sales prospectus.
So its clear to Johnson and her neighbors that someone wants them out their apartments knocked down and replaced by something more profitable.
The potential sale of 245 apartments for lower-income people has reignited long-simmering fears that downtown Raleighs rebirth will crowd out poorer neighbors to the south and east, swallowing up blocks suddenly turned valuable.
In the prospectus, a real estate firm in Atlanta described Washington Terrace as classic redevelopment potential in an area ripe for gentrification.
With color photographs and pie charts, the brochure touted Washington Terraces proximity to The Hue on the western edge of downtown, where rents run three times higher. It showed pictures of distant Duke University, Glaxo-Smith-Kline and Carter-Finley Stadium filled to capacity all as amenities new tenants could enjoy.
Theres nothing in the prospectus that mentions the neighborhoods where these lower-income residents live: College Park and Idlewild.
Theres nothing to show the actual scenery: the back side of dorms at St. Augustines University, an alternative school and Larrys Super Market, a small family grocery that is probably the only place in Raleigh to buy chitterlings by the bucket.
If Washington Terrace sells, I guess wed just have to get up out of here, said Johnson, 71. Were not the only senior citizens. A lady next door just passed, and she lived here 40 years.
The trend in Raleighs downtown apartment market has moved steadily away from affordable as new bars, restaurants and coffee shops have drawn long lines of customers, and business owners have shifted jobs to areas where their employees can walk or bike to work.
The prospectus from Cushman & Wakefield real estate brokers cites $1,466 average rents at The Hue on West Hargett Street and $1,136 at 927 West Morgan nearby. It shows that average rents at Washington Terrace, $548, have the potential to increase by more than 90 percent.
The subject property is situated within a one-mile radius of downtown Raleigh and in the path of urban redevelopment, the prospectus said. Two of the submarkets newest urban properties, The Hue and 927 West Morgan ... illustrate upper-end rents achievable.
Nathan Swenson, listed as the firms contact in Atlanta, did not return a call or email Thursday.
A rosy picture
Though only two miles apart, the neighborhoods are starkly different for residents of Washington Terrace and The Hue, where some apartments feature balconies and floor-to-ceiling windows. Johnsons home lacks a washer and dryer, and the bathroom is too small for her husbands wheelchair. To describe the area as exclusive is a stretch.
A lot of purple prose, said Gregg Warren, president of the nonprofit housing group DHIC. I think that, always, the realty agents try to spin the most rosy story, and this one seems to be overreaching.
The apartments have had a troubled and tangled history.
In 1996, an Ohio investor bought it for $2.7 million, borrowing $7 million from Fannie Mae. The company later defaulted on the loan and the apartments went into foreclosure. Fannie Mae bought them at auction last year for $5.8 million, then sold them to Ocwen Financial Group out of West Palm Beach, Fla. one of the nations largest mortgage servicers.
As of August, the units were 93 percent occupied.
Sale is not certain
Its disturbing to me, City Councilman Eugene Weeks said. They are talking about displacing the individuals who are there and not make anything affordable over there.
The sale is not guaranteed, and Allison Hapgood at Raleigh Housing Authority noted that Washington Terrace was renovated and prepped for sale about six or seven years ago.
The good news is they tried before, she said.
Meanwhile, the Johnsons keep Wake Countys resource guide for senior citizens close at hand. If they had to move, she said, they could probably find housing.
But not in that neighborhood, and not at that price.
Staff writer David Bracken contributed to this report.
Shaffer: (919) 829-4818