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Wednesday, April 23, 2014

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Cascade: No. 63, Fall 2006

Public-Private Partnership Tackles Blighted Housing

Some 2,700 people have purchased homes developed or financed by the Wilmington Housing Partnership (WHP), a public-private partnership that seeks to increase homeownership and improve housing conditions in Wilmington.

WHP, a 501(c)(3) formed in 1989 by the City of Wilmington, acts as a developer or obtains financing and facilitates development by nonprofit and for-profit developers.

Norma Zumsteg, a vice president of community development banking for PNC Bank, Delaware, and a member of WHP’s board during the last two years, observed: “WHP changed its direction in the last few years from acquiring properties in very deteriorated neighborhoods to pro-actively targeting selected neighborhoods that were basically healthy but had some deterioration. The targeting was a significant step in the right direction. WHP is having more impact and that in turn is helping WHP obtain more housing development financing.”

WHP is targeting five neighborhoods in its residential improvement and stabilization effort (RISE), a five-year program that is now in its third year. Jerry Cain, WHP’s executive director, said that it had been very expensive for WHP to acquire and hold a large inventory of properties in past years. “Now we take the tough [properties] with the goal of getting investors and homeowners interested in other properties in the area,” Cain said.

This photo shows part of the Kirkwood I Manor project, which consisted of 14 newly constructed units and four rehabilitated units. The average selling price of the units in 2002 was $90,000.This photo shows part of the Kirkwood I Manor project, which consisted of 14 newly constructed units and four rehabilitated units. The average selling price of the units in 2002 was $90,000.

WHP has completed 40 new homes and rehabilitated 63 homes on Wilmington’s east side, a RISE neighborhood east of the central business district.

WHP primarily assists low- and moderate-income residents, but it also participates in some projects that attract middle- or upper-income buyers as part of a broader goal to promote income diversity. For example, WHP recently bought a vacant warehouse and adjacent deteriorated houses located about a quarter mile from the Justison Landing development and is remediating the three-acre site and doing predevelopment and design work. The warehouse will be demolished, and WHP will issue a request for proposals (RFP) to for-profit developers to build about 40 new units that will have an expected sales price of $250,000 to $275,000.

In January 2006, WHP acquired a convenience store that had long been the site of illegal drug activity and plans to issue an RFP to build 18 homes, which are expected to have a sales price of $160,000. WHP expects construction of the homes to start this winter. In addition, WHP has provided land to Habitat for Humanity of New Castle County, which is building 17 units.

In 2005–06, 63 WHP-assisted units were sold to buyers and 115 units were in various stages of production.

WHP has three employees and is primarily funded by banks, foundations, and state and city sources. Of the $25 million raised by WHP, approximately 65 percent has come from banks, Cain said. Six banks are represented on WHP’s board of directors.

For information, contact Jerry Cain at (302) 576-3000 or jerry.cain@ci.wilmington.de.us; www.wilmingtonhousingpartnership.com.