A House Divided
A homeless man crusades against condo conversions in Burlington
Most houses on lower Maple Street in Burlington look washed out in the middle of January, but not the five-unit dwelling at 122 Maple - it's freshly coated with striking hues of lavender and pastel green.
This new splash of color brightens the street, and many people would argue that's not just an aesthetic judgment. They see the property as evidence of progress because of a sign hanging from the porch that says, "Condos for Sale."
Burlington developer Stu McGowan is converting the former apartment house into a condominium complex, with five one-, two- and three-bedroom units selling for $115,000 to $190,000. In a city where the average home sells for more than $250,000, these dwellings offer the possibility of home ownership to low- and moderate-income buyers who might otherwise be priced out of the market.
Condo conversions aren't common in Burlington, but they're becoming more so, especially in areas with lots of rental housing, such as the King Street neighborhood and the Old North End. Because of skyrocketing housing prices, landlords can now make more money by selling some units than by renting them. And condo conversions are popular among city and elected officials and affordable housing advocates, who promote them as part of the solution to Burlington's housing crisis.
City Councilor Carmen George, a Democrat from the New North End, describes herself as a "passionate" advocate for condo conversion. She believes condos can help impoverished renters build equity. "People need certain tools to get out of poverty," George says. "Transportation is one of them; building equity is another one."
But if supporters of condo conversion view this candy-colored house on Maple Street as a sign of new life, Peter O'Callaghan sees it as a kind of death. O'Callaghan rented a one-bedroom apartment at 122 Maple until he was evicted in October. Unable to find an apartment as affordable as the one he lost, the 51-year-old decided to try living out of his car. Three and a half months later, he's still homeless.
O'Callaghan blames the condo conversion for his predicament. People who want to improve access to affordable housing by demolishing cheap apartments in favor of $100,000-plus condos are "living in ga-ga land," he says. "They're just not looking at reality. I wasn't 'building equity,' but I had a place to live, and it was truly affordable."
O'Callaghan complains that the truly low-income people living in units that are converted will not be able to afford a condo. According to the Vermont Housing Awareness Campaign, the median price of a primary-residence condo in Vermont in 2005 was $174,500 - more than a family making the median income of $45,700 could afford. O'Callaghan claims that, by converting condos in predominantly low-income neighborhoods, developers are driving renters like him from their homes. Those renters are then forced to compete for an ever-shrinking pool of rental options, at a time when federal Section 8 funding has been slashed.
"How do you create homelessness in America?" O'Callaghan asks rhetorically. "Well, this is one of the ways."
Both the city and the state recognize the potential hardships awaiting tenants whose apartments are condo-ized. Local and state laws require landlords to give tenants several months or even years of notice, as well as money for relocation expenses and an option to purchase their units.
But O'Callaghan didn't receive any of these benefits, and he says his case proves that developers can circumvent the laws that exist to protect people like him. Though the city hasn't received many tenant complaints about the ordinance, O'Callaghan suspects that's because others haven't been savvy enough to raise a stink. He's speaking up now to help them, he says: "I just think the city needs to be held accountable. If they have all these regulations, they need to enforce them."
Even condo-conversion advocates like Brian Pine, assistant director for housing and neighborhood revitalization at Burlington's Community and Economic Development Office, concede that O'Callaghan has a point. "He's a great case study of why there's a downside to condominium conversion," says Pine.
Given that the city council voted this week to make it easier for developers to pursue condo conversions in some low-income neighborhoods, a discussion of O'Callaghan's case seems timely.
O'Callaghan explains his situation in an interview in the Seven Days office. A wiry guy with a neatly clipped, graying goatee, he's bundled up in a knit cap, hoodie, Carhartt jacket and work pants. Fingerless gloves warm his hands. Behind his rectangular-frame glasses, his eyes flash with intelligence and intensity.
O'Callaghan lived at 122 Maple for 12 years before he received an eviction notice in August, informing him he had 60 days to leave. His landlords told him they were selling the building, and the buyer wanted it vacant. Though O'Callaghan had a lease early in his tenure, it had run out. Like many long-time renters, he was paying for the apartment on a month-to-month basis, which meant that his eviction was legal.
Still, "It was a shock," he says.
And it came at a bad time - O'Callaghan was preparing to start the fall semester of his senior year at the University of Vermont, and he didn't have much time to look for a new place.
For 25 years, O'Callaghan worked as a carpenter; when that job became too physically taxing, he enrolled full-time at UVM, where he studies social work. School seems to suit him: In December, he was among the first 16 students to be inducted into UVM's new nontraditional student honor society. As part of his studies, O'Callaghan's actually interning at the Lake Champlain Housing Trust, counseling LCHT tenants who are facing eviction.
O'Callaghan looked for an apartment at the start of the semester, but he couldn't find anything as cheap as his 300-plus-square-foot place, where he was paying just $475 a month, including heat. His landlords offered him a one-bedroom in another building for $650 a month, heat not included, but he couldn't afford it.
What about a roommate situation? O'Callaghan admits he might have been able to find one but says he wasn't interested. He figured he'd snag something within his budget eventually. In the meantime, he put his belongings in storage and moved into his aging two-door car.
After months of searching, O'Callaghan has stopped looking, he says. He's resigned to his situation, at least until he's done with school. He's modified his car, removing the passenger seat so he can stretch out to sleep. He has grown accustomed to traveling light, showering at the UVM athletic facilities, and searching for places to park where no one will hassle him at night. Some nights he's more successful than others - UVM cops recently kicked him out of a student lot at 3 a.m., despite his valid parking permit.
O'Callaghan began investigating condo conversions after he drove by his old digs in late November and saw the "Condos for Sale" sign. No one had told him the building would be turned into condos, and the discovery "raised some red flags," he says. As a former contractor, O'Callaghan knew about the regulations governing condo conversions. So he started digging.
He found that, according to state law, developers who turn apartment buildings with up to five units into condos have to give their tenants advance notice of the change. Elderly or handicapped tenants are entitled to a year of notice and low-income tenants to six months; everyone else gets three months.
Burlington's ordinance is even stricter. It applies to tenants who live in buildings with three or more units, and it gives elderly and disabled tenants four years of notice; everyone else gets two.
Under both city and state laws, tenants also have first right of refusal to purchase their units, and they're entitled to relocation expenses paid by the landlords, not to exceed $1000.
O'Callaghan also discovered that as of the beginning of December, the project at 122 Maple had not yet received a zoning permit, though Gracie Conroy Realty was already marketing the units. This revelation infuriated him.
"The whole reason they have zoning permits is so people can find out about things before they happen," he says.
After exchanging emails with a code enforcement officer, O'Callaghan wrote to City Attorney Ken Schatz on December 1, calling the project "unconscionable" and requesting an investigation into the alleged violations.
Despite O'Callaghan's concerns, it turns out the project may be legal. Schatz is still investigating O'Callaghan's complaint. But according to Brian Pine, it will be difficult to prove there's been a violation of the condo-conversion law.
"His situation illustrates - I don't know if you'd call it a loophole," Pine says delicately. "His situation is not covered by either state law or city ordinance."
That's because O'Callaghan's landlords evicted him prior to selling the building. In case of sale, the buyer's stated intent is what determines whether the ordinances apply. So if the buyer, Burlington developer Stu McGowan, didn't know - or didn't say - that he would pursue condos before he bought the building, he's in the clear.
"It's kind of a way around the ordinance, in a way," Pine notes, "but it's clearly not a violation of the ordinance."
The zoning permit was something of a red herring, it turns out. Condo conversions aren't really a zoning matter - the ordinance is enforced by the city attorney's office. All McGowan needed from Planning and Zoning was approval to change the number of parking spaces. His permit was granted in December by an administrator; it didn't even have to go before the Development Review Board.
There's a certain irony in McGowan's involvement in this dispute. The charismatic Old North End resident has a reputation for being a developer with a social conscience - as well as an eye-catching lime-green buzz-cut. He's been an outspoken advocate for impoverished residents of his neighborhood. Last year McGowan chaired the Burlington school board task force that recommended a policy of socioeconomic integration in the city's elementary schools; the plan has proved controversial, particularly in middle-class neighborhoods in the New North End.
McGowan insists he wasn't trying to evade the condo-conversion law. He says he really didn't know before he started construction whether he would be able to keep the apartments or would turn them into condos. "You never really know what you're going to get into until you start tearing down walls," he says.
Indeed, McGowan claims all he knew when he bought the building was that it needed extensive renovations. "The one at 122 was kind of a mixed bag," he says. "There were a couple of apartments that were in passable shape. They hadn't had much done to them in 20 years. The one that Peter was in was actually our worst. It was an absolute disaster. The roof had gone a long time ago; there were parts of the ceiling coming down. I honest to God do not know how the city passed this every year."
When McGowan broke through one of O'Callaghan's walls, he says, he found severe structural damage to a load-bearing brick wall, a situation that would be dangerous if left unchecked.
In McGowan's experience, many low-income tenants are forced to live in these kinds of conditions. "The landlords, either through spoken or unspoken agreement, don't put a lot of money into a building. So if somebody's lived in a place for a long time, the place gets progressively worse and worse and worse, and they're kind of stuck, in some ways, because they've got this low rent."
"That's the trade-off," he continues. "Your rent's not going to go up too much, but you're stuck in really substandard housing."
O'Callaghan has a somewhat different assessment of his living space. "The apartment did need work," he admits, "although I did not need to be saved from impending collapse, as seems to be suggested. An old girlfriend of mine once described it as a 'crappy apartment.' This does not erase the fact that it was my home."
McGowan says he was upset to learn that O'Callaghan, who once lived down the street from him in the Old North End, was homeless. If he'd known O'Callaghan didn't have a place to stay, he would have offered one of his own apartments, McGowan says, adding that it's something he's done in the past.
"It twisted my heart into little teeny pieces when I heard he was pissed off," McGowan says earnestly, "because that's just not my style."
O'Callaghan's experience aside, McGowan believes this condo conversion is a good thing, and not just because he stands to profit from it. The condos will attract homeowners to the neighborhood, he says. According to U.S. Census data, just 20 percent of residents in the area surrounding 122 Maple Street own their homes. That's comparable to homeownership rates in the Old North End, and nearly the reverse of rates in parts of the New North End, where more than 70 percent of residents own their homes.
Attracting homeowners is essential to "stabilizing" these neighborhoods, McGowan says. "The housing issue is way more complex than just 'Do people have the ability to live somewhere?' It's how they're going to live there, how much they feel like they own the neighborhood or don't own it."
CEDO's Brian Pine agrees. He says the city would like to see a greater number of homeowners in areas where ownership falls below 50 percent. He enumerates a long list of homeowner virtues: They're more likely to vote, more likely to get involved in the schools, more likely to take part in civic activities. "They set down roots and stay longer," he says.
Anecdotal evidence from new condo owners in the city seems to bolster this argument. James Haslam, director of the nonprofit Vermont Workers' Center, recently bought a condo in a former apartment building on Bright Street converted by developer Marvin Fishman. He lives there with his partner and their dog. "We're part of the neighborhood," he says. "We had a thing we did with CEDO a couple months ago where we all planted bulbs, a kind of beautification project."
Haslam, 33, had been renting in Burlington for years. He admits that his 600-square-foot unit is tiny but says, "It's perfect for me," adding that, at $128,000, "It's about all that I could afford to buy."
From Haslam's perspective, condo conversions make a lot of sense. But the labor activist says he's troubled by O'Callaghan's experience.
So is Burlington City Councilor Tim Ashe, a Progressive from the Old North End. A vocal proponent of condo conversion, Ashe is one of the architects of an amendment - passed at Monday's city council meeting - that relaxes the city's strict condo-conversion ordinance on buildings with 10 units or fewer, in neighborhoods where fewer than 50 percent of residents own their own homes.
Ashe argues that new condo conversions won't just help low-income people; they're also good policy for attracting and retaining young residents like Haslam. "Currently, if you're between 21 and 35 and you earn between $20,000 and $30,000 a year, you simply cannot buy a home in Burlington," Ashe says. "To not encourage some homeownership in these particular neighborhoods is like saying, 'To all you people who are between the ages of, say, 21 and 35 who don't have a trust fund, bug off, we don't want you owning anything in Burlington.' And that I can't accept."
Ashe points out that, although his ordinance change would eliminate the two- and four-year notice periods, it would do so only for condo conversions located in the target neighborhoods, and it would require that developers keep at least a quarter of the units perpetually affordable to low-income tenants. He adds that the state protections governing those buildings would still be in place. So it's not as if developers will have a green light to toss renters to the curb.
But Ashe says the loophole O'Callaghan has exposed needs to be addressed. "The intention is not to see tenants, particularly tenured tenants, get thrown out on the streets," he says. Ashe wants the city council to clarify how the ordinance should work when a building is sold to a developer who initiates a condo conversion.
Stu McGowan would like some clarity, too. "This was a pretty big shock for me," he says of the situation at 122 Maple. "I'll say it: I'm stopping, I'm thinking. I'm thinking really hard now about how this all works. Because I don't want to upset people."
It's a situation McGowan may confront again - he plans to buy the four-unit apartment building next door to 122 Maple in the spring. Not surprisingly, he says he's not sure if he'll be converting it to condos.
Brian Pine stresses that, in addition to revisiting the condo-conversion ordinance, the city will continue to support the creation of new affordable rental housing in Burlington and surrounding communities.
He also points out that, even if the city closes the loophole in the condo-conversion ordinance, it won't change the fact that some renters will be forced to leave to make way for homeowners. There will still be "a human cost" to condo conversion, Pine says.
In other words, renters like O'Callaghan will still be displaced, even by developers with the best intentions.