At ELDI, we have witnessed the power of a mixed-income community to transform lives for the better. More than 20 years after East Liberty’s first community plan, this approach has helped facilitate billions of dollars of new development in the neighborhood, create more than 1,139 units of new affordable rental housing, and add more than 2,800 jobs to the community.
While much has been accomplished, there’s still more to be done. To ensure that East Liberty remains a thriving mixed-income community well into the future, we are working to maintain a healthy mix of rental and homeownership opportunities, along with affordable and market-rate housing.
In particular, we have been exploring ways to increase affordable homeownership, especially for long-time minority residents. 302 Enright Court is a prime example of these efforts—and a testament to the hard work and creativity that often go into funding just one affordable unit.
But what exactly does that work entail?
Come along as we pull back the curtain on the development process. Discover the journey of developing the affordable home 302 Enright Court and what it reveals about building affordable housing in East Liberty and beyond.
302 Enright Court, a timeline
2014 – Redeveloping the community of Enright Court
The story of 302 Enright Court starts back in 2014 when ELDI began revitalizing East Liberty’s Enright Court. Sitting just a few blocks east of East Liberty’s commercial core, the Enright Court townhouse community comprises 98 predominantly owner-occupied homes built using funds from the Housing and Urban Development Section 235 Program in the early 1970s.
Over the years, Enright suffered from vacancy and fell into disrepair, but in 2014, we set out to change that, purchasing nearly 30 units to rehab them and return them to homeownership.
As a part of that process, we worked with renting tenants to prepare them for homeownership with our partner program Catapult Greater Pittsburgh.
2019 – ELDI is appointed conservator of 302 Enright Court
As part of this effort, ELDI became conservator of 302 Enright Court in 2019. Conservatorship is one route community organizations and others can use to put abandoned property back into productive use. Our goal was to gain control of the property, renovate it, and sell it at an affordable price to a minority buyer.
But things didn’t go exactly as planned.
“We were awarded conservatorship of 302 Enright Court in 2019,” explained Shivam Mathur, ELDI’s former real estate project manager. “In 2020, we were in talks with a local institution to get a loan to renovate these units. However, because these properties were under conservatorship, that meant we didn’t have clear titles, which was a problem for their underwriters.”
While conservatorship offers a way to gain control of properties that would otherwise rot away, the technicalities can make things tricky. Having a clean title is essential, because even though an appointed conservator can technically start renovations, it’s difficult to find someone who will lend you money for those renovations.
“That’s why, rather than jumping right into renovations, we typically first stabilize a unit so that it doesn’t further deteriorate,” said Mathur. “This can look like cleaning it out, interior demolition and stabilization, and sometimes even putting on a new roof. During this time, we are bearing all the holding costs and legal fees.”
A brief look at how the conservatorship process works:
1. File a petition
An organization or individual files a petition to become a conservator (essentially a legal guardian) of a property.
2. Notification of interested parties
When a petition is filed, all heirs have a chance to claim their rights to the property. (In the case of 302 Enright Court, the original owners had passed away and no heirs claimed the property.) If an heir contests the conservatorship petition, the court will evaluate the heir’s objections as part of a legal process.
3. Rehabilitation plan
The conservator submits a plan to the court outlining how they will restore the property. This may include repairs, securing financing, and ensuring compliance with local codes.
4. Stabilization
Once an organization or individual is granted conservatorship, the property usually needs to be stabilized as it is typically in bad condition.
5. Transfer of ownership
Once stabilized, the property can be sold to the conservator to recover costs. Proceeds from the sale may go to repay the conservator, lienholders, and others, with any remaining funds returned to the owner. Before the final conservatorship hearing, the value of the property is appraised. In 99% of cases, the conservator has already spent more money stabilizing the property than the property is worth. This is when the conservator can ask the judge to exchange the money spent, known as a “conservative lien,” for the title. The judge usually agrees and strikes off all previous liens and encumbrances, granting the conservator a clean title.
2020 – ELDI goes to the courts to gain title of 302 Enright Court
In the case of 302 Enright Court, we went back to the courts to get a clear title in 2020, but due to the pandemic and a shortage of judges, it took two years before we were able to gain title of the property.
2022 – We secure a clean title and loan to renovate the home
In 2022, we were able to secure a clean title to 302 Enright Court, and we went back to our lender and closed on the loan for us to renovate the unit.
2023 – We receive the deed and construction starts
In November 2022, we received the court order to transfer the property into our name and recorded the deed in January 2023. We started working on the property right after that.
However, the budget that we had created and against which we had gotten grants, was no longer accurate. Construction rates during the pandemic went up by around $10-20,000, which meant that, with our original loan, we would lose money on the property. The only way out was for us to general contract the project ourselves.
“I was taught in school the important balance between quality, time, and money in construction—if you move one, it disrupts the other two. So, we really had to find the perfect subcontractors—that’s where ELDI’s Construction Manager Donald McCartan was instrumental. He tracked down people who could provide high quality work within our budget,” shared Mathur. “Since we were focusing on these two elements, unfortunately, we had to accommodate on time.”
2024 – We finish the renovations
Six years later, in May 2024, we finished the rehab of 302 Enright Court. Normally, a home like this should take around 18 months; one year for the conservatorship process and around six months of renovation, but due to the pandemic, things were extremely delayed.
The final budget
“As for the final numbers, our total project budget was around $200K. We spent about $150K on construction, over $30K on soft costs (i.e., legal; holding costs like utilities, maintenance, taxes, and insurance for over four years; environmental testing for lead and asbestos; etc.). ELDI took less than $20K for payment,” said Mathur. “In the end, that meant that, financially speaking, this house was a loss for us. We should have received about $10K in interest, and we didn’t charge any overhead or profit for performing the construction as a general contractor, nor did we charge for staff hours.”
2024 – An affordable, minority homeowner moves in
The home sold in July 2024 to a minority buyer earning 80% of the Area Median Income.
“In the end, ELDI bought it, financed it, renovated it, and sold it,” said Mathur. “The end result looks absolutely amazing, and it was worth it to put this property back into use for a minority homeowner, but all in all, it took us almost six years to renovate one unit. While this isn’t the norm, it’s also not unusual. People don’t often understand how many boxes we have to check just to get out the door.”
The importance of fostering mixed-income communities
As the divide between rich and poor continues to grow in America, mixed-income communities represent one way of helping to bridge the gap.
“The next generation of mixed-income communities is incredibly consequential because it offers unique geographic potential for healing and connection across differences as well as a path to mobility out of poverty,” said a Shelterforce report.
Cultivating more equitable and inclusive mixed-income communities will require a mix of micro and macro strategies, and community development corporations have a vital role to play.
“It goes to show how difficult—and how important—community development is,” noted ELDI’s former Deputy Director, the late Skip Schwab. “You won’t see market-rate developers jumping through these hoops to complete a few affordable units. That’s why it is essential for neighborhoods to have organizations that are willing to develop strategies and put in the hard work of redeveloping homes for the long-term good of a neighborhood. That is how we build lasting, thriving communities.”