Friday, January 15, 2010

georgian's landlord has frustrated tenants nationwide

'Georgian Cafe'
Seeking to recast their 1960's-era Georgian Apartments in Downtown Silver Spring as a luxury complex, Stellar Management topped off their multi-million-dollar renovation by throwing a party with a well-known DJ, models and the now-infamous "sushi girl." Five months later, they've defaulted on a $58 million loan, according to local real estate site CityBiz. It's just part of a $215 million mortgage taken out to fix up the buildings at Georgia Avenue and Fenwick Lane.

Stellar Management left the Georgian's twin seventeen-story buildings were unstaffed and unpoliced over New Year's celebrations, according to the tenant-run Georgian Confidential. The lack of security resulted in vandalism of common areas and reports of a stabbing shortly after midnight.

A 2007 article in Real Estate Week calls the New York-based Stellar Management the "pre-eminent renovator of large, gateway-market rental assets in America," with properties in six major metropolitan areas. In Silver Spring, they still own The Enclave, a high-rise apartment complex located at Columbia Pike and New Hampshire Avenue similar to the Georgian where they've borrowed $270 million for renovations and a new clubhouse.

Sushi Model

Georgian residents aren't alone in complaints about Stellar's lax service and unjustifiably high rents. Nationwide, the firm's received bad marks not only for the management of their apartments but for community relations as well. An article in Crain's New York says tenants consider Stellar head Laurence Gluck a "decent landlord" but say he's very litigious, suing his own buildings to prevent them from being rent-controlled.

Tenants of Stellar properties in New York City, many of which are rent-controlled, complain of negligent management and drastic rent increases. Even neighbors of the firm's newly constructed buildings say they're poorly designed and shoddily built. At Parkmerced, 1940's-era garden apartments in San Francisco that Stellar is already renovating, tenants are upset over proposals to basically raze the entire neighborhood for redevelopment.

Having grown up in the Georgian in the 1990's, I was glad to see the aging complex restored to its former glory. But it's disappointing that in this case, redevelopment had to bring mismanagement, threats of gentrification and ultimately a financial meltdown that's not too surprising in the current recession. It shouldn't be too much for tenants to live in a well-maintained building for a reasonable price, whether or not it comes with granite countertops. Hopefully, the building's next owners will understand that.


chippy said...

So Stellar is out! After they hob- knobbed with the County Exec and Dept of Economic Development while exploiting a young girl by eating Sushi off of her private parts. I can't understand why a reputable company like that would just split town!

Well at least I got my memories and my Free towel !

OG said...

Great article JUTP! The Georgian Confidential collective is most grateful. Things are sucking here more and more--phone calls to management not returned, no effort to explain what's going on. But at least we can let prospective renters know what they are getting into. They are STILL renting and showing apartments and I seriously doubt the new people know what they are getting into.