Render Unto Ceasar

Echo Village:  Under New Management (and ownership)

So I guess it should come as no surprise that the first thing Eagle Crest Management does with their recently acquired $3 million property is to raise the rents, thus forcing out most of the clientele in the 24 unit apartment complex, many of them low income, Section 8 tenants.

Quite the ecosystem at work:  Jamie Cherewatti buys the property, valued at $2.1 million, from Jerry Gates who is on the Board of Directors for Craig's Doors Homeless Shelter.  Good thing the Amherst Select Board recently ignored Town Manager John Musante's less than enthusiastic support and allowed the shelter to expand from 16 to 22 beds.

When he appeared before the Zoning Board of Appeals last April to testify in behalf of his successful request to double occupancy at 156 Sunset Avenue, Jamie Cherewatti said plaintively, "I don't want to be known as the slumlord of Amherst."

So maybe he plans to invest millions in the Echo Hill apartment units and rent to upscale blue bloods.  Or maybe not.  Perhaps he will just replace the current, sometime problematic clients, with his usual Modus Operandi, students.  

These days Cherewatti seems to be diversifying his property holdings using a variety of legal entities:  He moved Eagle Crest, his real estate management company, to above one of the more rowdy bars in downtown Amherst -- Stacker's -- after buying the building.   Plus ownership of a slew of expanded rentals all over town, as well as managing a number of units that have earned my prestigious,  'Party House of the Weekend' award

No matter what his final plans are for Echo Village Apartments it's clear the 24 units will no longer be considered "affordable" by state definition.  And when Amherst is already less than 1% above the threshold for the ultimate bogeyman, a Chapter 40B development coming to town, every single affordable unit matters.

This will be used by some landlords as ammunition to try to shoot down rental registration/permit system bylaw coming to Town Meeting this spring.  The argument will be that Amherst strangles developers in red tape so no one will want to build housing in town -- affordable or market rate -- thus increasing the likely hood of falling below the 10% threshold.

Of course after the Gateway Project was scuttled by NIMBYs, perhaps a 40-B development is the only way to make serious gains on our chronic rental housing shortage.

Profit vs Image

Turning up the heat on Jamie Cherewatti on a freezing afternoon

About a dozen protesters descended on Jamie Cherewatti's 55 North Pleasant Street downtown office location, above a bar naturally, to publicly shame him for not selling Echo Village Apartments in East Amherst to a developer picked out by the town to maintain the 24-unit rental operation as "affordable."

 Echo Village Apartments yesterday (remember folks to shovel out fire hydrants)

Meanwhile, the day before, when protesters first staked out his downtown business, Mr. Cherewatti purchased the immediate neighboring house to Echo Village Apartments (also a multi-unit rental) for $360,000 cash, a little below assessed value of $377,000.

 310 Belchertown Road

 And guess who Rocky Hill Road Partners LLC is?

Tenants United

About 25 people packed into the Family Outreach office located in a commercial building owned by Eagle Crest Management, AKA Jamie Cherewatti, to strategize a response to sudden eviction notices for all the tenants living in Echo Village Apartments located next door, 24 units of -- by Amherst standards anyway -- affordable housing.

A little less than half the crowd was made up of a (Section 8) tenants and the rest was a fusion of government and non-profit personnel from the Amherst Schools, Amherst Housing Authority, Planning Department, Legal Services and even the NAACP.

Also hard to miss was former Echo Village tenant, who said he was "paid to leave", Motown Benny.  Although at one point in the meeting he was asked to stop talking and "get down off his political soapbox."

Motown Benny (Johnson)

The good news was tenants did not have to abide by the 3/31 deadline demand to vacate the premises. But that is the trigger date for Mr. Cherewatti to start legal eviction proceedings  in Housing Court, and then of course it's up to the judge to decide.

Eagle Crest claims all tenants can "reapply" for tenancy on April 1st (no foolin) as long as they have moved out by March 31.  Although one official reported Eagle Crest must give 60 days advance notice before implementing a rent increase to Section 8 tenants, which he has not done.  The management firm has, however, giving notice of "termination."

The really bad news is that Cherewatti can indeed raise the rent and that will price all Section 8 tenants out of the market anyway.  Said one frustrated official, "Our hands are tied on so many levels."

Six weeks ago Cherewatti purchased the property, assessed at $2.1 million, for $3 million, and is now raising rents the same 30% or so he overpaid.  Just business.

Although, you can't put a price on a positive public image. 

"That Really Stinks"

Budget Coordinating Group this morning

Good thing about being a fly on the wall at public meetings not usually attended by reporters is town officials are a tad more forthright with their comments.

Take this morning's Budget Coordinating Group meeting for instance.  During his update on the Echo Village negotiation with mega-property owner Jamie Cherewatti, after lamenting the deal falling through at the last minute, Town Manger Musante closed with, "That really stinks".

The town had put all their eggs in one basket with a proposed Community Development Block Grant request of $800,000 because $600,000 of that would have gone towards purchasing from Cherewatti the 24 unit Echo Village Apartment complex.

James Cherewatti on left

The deadline for the grant application was February 14 (how romantic) and Cherewatti's last second rejection (by ignoring it) of a "fair market" purchase offer means the grant application is now dead.  The price offered is exempt from Open Meeting Law public disclosure, although the principal party who made the offer could probably release it.  

The Town Manager pointed out to the BCG, "That has a domino effect on three other programs:  Homeless Shelter, Food Pantry Program at the Survival Center, and $20,000 in emergency funds for the needy."

His proposal, which seemed to garner the support of the group, is to now take a $125,000 recommendation to Town Meeting using Free Cash.

He specifically wants it to be a stand alone item separate from the overall budget to telegraph that it's a "transitional" emergency appropriation, and not a return to the old days of annual town funding of Social Service programs. 

Finance Director Sandy Pooler floated the idea of having the money come out of Stabilization Fund which requires a two thirds vote to reinforce that this is a one time thing, and that Town Meeting "would really have to think about it."

BCG Chair Stephanie O'Keeffe cautioned it could send the message that town officials were setting too high a hurdle and it could be "off putting" to Town Meeting members.

Pooler responded that many things -- including bridge replacement or DPW snow and ice budget increases -- requires a  two-thirds vote, so this is not "singling out" social services.

Finance Chair and Select Board candidate Andy Steinberg thought perhaps the $125,000 should simply be in the routine general fund budget.   Stephanie O'Keeffe quickly responded the Select Board voted Monday unanimously that it be a stand alone article.  This reinforces the notion that we are simply "bridging the gap."

Select Board member Alisa Brewer (always a tad more forthright) added, "I will say it more aggressively:  NO!"

Even the Amherst Bulletin is aroused

A Cold Reality

Finance Committee Chair Andy Steinberg Co-Chairing Budget Coordinating Group Thursday morning

Amherst finance guru Andy Steinberg addressed the two town meeting warrant articles calling for many millions of dollars in spending for the eminent domain taking of two properties in town and his brief comment Thursday morning could fit on their tombstone:  "It's hard to imagine how these things are feasible."

Indeed.

But where was he 25 years ago when the town spent the most money in history for an eminent domain taking:  Cherry Hill Golf Course @ $2.2 million, simply to satisfy 100 NIMBYs in North Amherst.

But yes, two wrongs do not make a right, and at least maybe town officials learned something from the Cherry Hill debacle ... maybe.  The taking of W.D. Cowls property in the bucolic Cushman section of North Amherst would cost many times more than the $1.2 million that appears in the warrant article.

Since Cinda Jones has an offer of $6.6 million on the table from a serious developer who wishes to construct high end student housing,  that is how much it would cost the town to take it.  6.6 million.  Dollars.   A UFO piloted by Elvis landing in town center on the 4th of July is f-a-r more likely to happen. 



The taking of Echo Village, which would cost close to $3 million, has a far better shot with Amherst Town Meeting, as the impacted residents who are being evicted will generate far more sympathy than the well off white people from North Amherst.

And the new Echo Village owner, Jamie Cherewatti, is not overly popular with neighborhood groups all over Amherst.  At the Housing & Sheltering Committee meeting yesterday, where about-to-be-evicted tenants presented their case to the committee, Town Meeting member Paige Wilder chimed in, "Jamie Cherewatti owns four houses in my neighborhood that are all party houses."

Social activists Vince O'Connor and Kevin Noonan also spoke in behalf of the tenants urging the committee to support their article for an eminent domain article.  O'Connor pointed out if the town used Community Preservation Act money to fund some of the taking it would place an affordable housing restriction on the deed.

 Peter Jessop, Chair Amherst Community Preservation Act Committee

The CPAC did vote on Thursday night to support an emergency appropriation of $15,000 to help the tenants with relocation.  Apparently the former owner, Jerry Gates, was a tad more benevolent than the new owner and did not require first and last month's rent for new tenants so now there's no savings to rely on for getting a new apartment where that is required.  

But if Town Meeting should override CPAC committee recommendations and use money towards the outright purchase then the 24 units of housing would count towards the town's affordable housing stock, currently at 10.8%. Now in danger of falling below 10% and opening the town up to a Ch40B development.

 Echo Village Tenant Tracylee Boutilier addresses Housing & Sheltering Committee

Either way, with the Residential Rental Property Bylaw bringing a game changing permit system to town also on the warrant, Amherst Town Meeting should be more interesting than a night of network reality TV.

I can't wait.

Lords Over the Land

290 Lincoln Ave, barn on death row in rear

Just in the past five months using two different LLCs as a cloaking device, KH Amherst PE LLC and GP Amherst LLC, You-Pan Tzeng has purchased a half dozen Amherst houses, three of them on Lincoln Avenue -- one of the oldest streets in overly Democratic Amherst, named after a Republican President before a bullet to the back of the head elevated him to sainthood.

Over the past two years at public meeting after public meeting, residents of Lincoln Avenue have brought to the attention of town officials the persistent problem with unruly party houses, usually single family homes that have been bought up by speculators, subdivided into a" two family homes" and then crammed with eight unrelated, college aged tenants (Amherst zoning legally allows four per unit).

321 Lincoln Ave


The term "tipping point" was used often, meaning the number of owner occupied units was slowly becoming the minority on this historic old street that leads directly to UMass, our largest employer.

The recent purchase of three homes on Lincoln Avenue may very well have tipped the balance ... once and for all.

328 Lincoln Avenue

While Mr. Tzeng is keeping his cards close to his chest, he has tipped his hand with the filing of a ANR plan (Approval Not Required) before our Planning Board to jury rig a second building lot in a location now occupied by a historic old barn.

Even more ominous, You-Pan Tzeng testified before our Zoning Board of Appeals when he converted a one family house at 290 West Street to a two family operation that he "uses Eagle Crest Management for all aspects of property management ..."  Yikes!

Yes, although Eagle Crest owner Jamie Cherewatti testified before the Zoning Board for one of his conversions at 156 Sunset Ave last April that he did not want to be know as the "slumlord of Amherst", it would appear he doesn't work very hard at it. 

For starters, moving his business office from 73 Main Street Amherst into space above Stackers Bar, a youthful, less-than-elegant tap room in town center Cherewatti recently purchased using one of his front LLC's.  In addition to Stackers Pub Railroad Street Partners owns another half dozen rentals in town.


Nothing like staying on top of the source of your success:  alcohol and partying. 

Now that Cherewatti has partnered with You-Pan Tzeng (or vice versa), no neighborhood in Amherst is safe.  The town needs to call a moratorium on all housing conversions until this spring, so Town Meeting can takes up Planning Board articles that attempt to tame the Wild, Wild West. 
  
290 Lincoln Subdivide

The rest of You-Pan Tzeng's very recent purchases:

695/697 Main Street (yes, the garage is 695)

42 Shumway Street

300 West Street

Party House e-x-p-a-n-s-i-o-n

Amherst ZBA from right:  Mark Parent, Hilda Greenbaum, Keith Langsdale. Jeff Bagg town planner

In spite of strong objections from neighbors and a first round "NO" vote from member Hilda Greenbaum that would have denied the Special Permit, the Zoning Board of Appeals eventually came around to a unanimous 3-0 vote, allowing the house at 156 Sunset Avenue to double from a one family to a two family dwelling, thus legally allowing eight unrelated occupants--guaranteed to be UMass students--to take up residence.

While neighbors concentrated on the problems associated with college aged kids herded into non owner occupied dwellings without on-site managers, many turned their ire directly at Eaglecrest owner James Cherewatti.

 Neighbor Mark Sims voices displeasure (no one in crowd spoke in favor)

Last weekend, for instance, the house in question was the scene of a major party broken up by APD.  An analysis of downtown properties owned by Eaglecrest (123 total living units) shows 75 police calls over the past three years.

Unlike a new zoning bylaw approved by the Planning Board and a two-thirds vote of Town Meeting that applies town wide, this case was only about this particular dwelling.  And since only a small part of the structure was too close to adjacent property, the house could have been brought into conformity (and thereby guaranteed two family status) via a chainsaw.

 156 Sunset Avenue, Amherst

 ZBA member Mark Parent pointed out to the hostile crowd that at least now they can put conditions on the expansion, one of which is for Eaglecrest to enforce a "three strikes and you're out" clause to evict unruly tenants.

 Phil Jackson (rt) questions whether Jamie Cherewatti (left) will enforce discipline rules

Unfortunately the ZBA did not make that a mandatory provision of maintaining the Special Permit, so if Cherewatti does not enforce his own lease provision, there is no mechanism to revoke the Special Permit, thus leaving little recourse for beleaguered neighbors.

As Sonny and Cher would sing, "The beat goes on." Party beat, that is.

And Another One Gone

 80 West Street, Amherst

Jamie Cherewatti, aka Eagle Crest Management, North Pleasant Street Partners LLC, Railroad Street Partners and perhaps a dozen more LLCs just purchased the home at 80 West Street (Rt 116) for $160,000.

Yes, the house and property is valued at $207,200 so he paid well below that, but the house is a tad distressed.  I live only a few houses away so it's directly on the way to Crocker Farm School, and my kids have dubbed it "the scary house."

But considering the demographic market Mr. Cherewatti caters to, it could become even scarier.

Two months ago Cherewatti purchased a four-unit complex at 310 Belchertown Road, adjacent to his Echo Village Apartments, which he purchased last year for $3 million.  

Amherst Housing Monopoly Board

10 Tyler Place

One of Amherst's least favorite property barons just added to his already extensive housing empire.  Jamie Cherewatti, aka Rocky Hill Road Partners, purchased 10 Tyler Place for the relatively high price of $495,000.

Although the seller in this case, Joshua Hornik, paid $528,000 for it back in 2007, or $604,000 in today's dollars.

Since the building is a three family structure allowing for 12 unrelated housemates chances are pretty good it will simply remain a very profitable rental.

This is Cherewatti's second purchase in four months using the cloaking LLC, Rocky Hill Road Partners.

Echo Village Apartments, his most controversial purchase because he immediately evicted all the low income Section 8 tenants, was a much steeper investment at $3 million.  At purchase the property was valued at $2.1 million.

Interestingly, the town assessor now values Echo Village Apartments at only $1.795 million -- well below what Cherewatti paid.

Which probably has affordable housing activists salivating for the Fall Town Meeting to take it by eminent domain. 

Major Player Expands Empire

30 Gatehouse Road, Echo Village Apartments (24 units)

Jamie Cherewatti, aka Eagle Crest Management, branched out in a B-I-G way this week by purchasing #10 and #30 Gatehouse Road commercial complexes (business and residential) for $3 million using a new LLC, Echo Gatehouse Partners and $1.85 million in financing.

The price was well above their combined assessed value of $2.1 million, with the lions share being the 24 units of housing, a frequent destination for the Amherst Police Department.

James Cherewatti on left

 10 Gatehouse Road, commercial business condos

Cherewatti purchased the multi-use property from the original developer Gerry Gates, who with his long time business partner Dick Johnson (now deceased) built the sprawling development in the mid-1970s. 

Amherst Insurance Agency, #20 Gatehouse, is not included in the deal, although coincidentally enough that property was sold just sold last week by Ron Nathan for $700,000 to RAG Associates, aka Glenn Allan, a long time executive with the insurance business.

Amherst Insurance Agency: still your independent, locally owned full service insurance agency

Party House Of The Weekend

Yeah, I'm running late as we're almost into another warm, sunny weekend ... where anything can happen in a college town.

Grantwood Drive is a cozy development of about three dozen single family homes  all built just over 40 years ago.  The vast majority are "owner occupied" and you never see them listed in my Party House of the Weekend series.  A few are not owner occupied.  Take #115 for instance.

115 Grantwood Drive, Amherst.  Owned by Onasta Properties aka Pipeline Properties

Amherst Police were called around 1:10 AM early Saturday morning and arrested Chris D Lewis, age 19, Luke Richardson, age 19 and Albert M Carter, age 20 for noise.
 

Meanwhile only a couple hundred yards away at about the same time (1:24 AM) Police were called to 985 E. Pleasant Street by a homeowner complaining about college aged youth urinating in her yard.

Police arrested Timothy M Vanlew, age 20, Stephen F Gardner, age 21, and Ryan J. Donnelly age 21 all three residents of 985 E. Pleasant Street, a single family home with not enough bathrooms apparently.

Since Cherewatti only paid $160,000 for the house that was valued at $255,000 in FY2012, maybe he can afford to add a bathroom.

 

985 E. Pleasant Street  Owned by Eagle Crest Mgt aka Jamie Cherewatti

And Another One Falls

 1190 North Pleasant Street, Amherst (taken from Meadow Street)

The man with more LLCs than M&Ms have colors just added another trophy to his growing collection of Amherst rental units, this one in the heart of North Amherst center on the corner of Meadow and North Pleasant, two street names synonymous with student rentals and the all too familiar aftermath:  Disruption.

Jamie Cherewatti, aka Eagle Crest Management, aka East Pleasant Street Partners LLC,  just purchased 1190 North Pleasant, formerly Watroba's General store before they moved down the street a short ways and indeed, a student rental for the past few years anyway.

This makes the second time in a row he has coughed up well over assessed value for a property, paying $3 million for Echo Village Apartments (valued at $2.1 million) back in January.  And now this property, paying $495,000 -- more than ten times what Watroba paid for it in 1972 -- and $113,400 over its current assessed value.

Of course the assessor does not instantly increase the valuation based on this selling price, so the taxes paid to Amherst will remain around the same:  $8,000 next year.  But if he should buy the property next door and overpay by 33%, then perhaps the assessed values would increase.  "A rising tide lifts all boats"

Or if he should do renovations, but since the property is already a "two family," highly unlikely.  For instance Cherewatti purchased 156 Sunset Avenue for $350,000 two years ago as a "one family" dwelling, but then subdivided the home, added a little landscaping and morphed it -- with ZBA permission -- into a two family home, where 8 unrelated residents can legally reside.

The valuation has since increased to $404,000 or $8,000 in taxes paid to the town annually -- but the rental income doubled.  And with average rents in Amherst almost $2,000 per month, that doubling adds up pretty quickly.

Meanwhile just down the road in the historic neighborhood of Cushman, also located in North Amherst, red stop signs are springing up everywhere opposing "The Retreat," a 170 unit high-end student housing development.

The Village of Cushman

But the real enemy is not large corporate owned, professionally managed dense developments like "The Retreat".  It is instead the steady sprinkling of Mom-and-Pop operations that have creeped in under the radar.  The enemy within.

Badly Needed Competition

 356 College St.  From Pizza to Pizza

The number one reason Amherst has such a high property tax rate (well, besides the gold plated schools) is simple math:  half of all the property in town is owned by tax exempts and the other half is disproportionally make up of homeowners and rental units which shoulder 90% of the tax burden.

Commercial property makes up a desultory 10%.

So it's always sad to see commercial property become residential such as the old Watroba's General Store in North Amherst Center.  Which to be fair, happened a long time ago, well before the recent purchase by Jamie Cherewatti.

 

Watroba's General Store circa 1960s

From the book North Amherst and Cushman

But I find it telling that this 100 yard swap is taking place in East Amherst where Pioneer Valley Pizza is moving from 20 Belchertown Road, to 356 College Street.  Sure, maybe it's that they need less space than their previous 1,350 square feet spot, or maybe they got a better deal on rent.

10 Belchertown Road, former location Pioneer Valley Pizza

Or maybe it's because the building itself is in much better repair.

Yes it's the oldest saying in the evil book of capitalism: "When products compete they get better".  And what Amherst desperately needs is competition in the student rental business.  Because now, with such huge demand and a strangled limited supply, the competition is at best token.

If developments like The Gateway, now dead, or The Retreat, now under attack, were allowed to happen off-campus students would flock to them like swallows to Capistrano.   The Mom-and-Pop operations that do a despicable lousy job of upkeep would have to step up their game to compete, or sell out to a more responsible investors. 

Either way, increasing the supply of safe, quality and affordable housing is the answer.  And we need it now. 

Party House of the Weekend

26 Allen Street

Last weekend was a throwback to the bad old days of three or four years ago when the classic party house -- single family student rentals owned by absentee landlords -- reared their noisy heads.

 Gibson/Kaufman

 Click to enlarge/read

McGrath/Manousakis

The town has been investigating 26 Allen Street for many, many months now as a suspected frat house and incidents like this only add to the evidence.

 80 West Street

And 80 West Street was only purchased by Jamie Cherewatti two years ago and this is the second time it has made Party House of the Weekend (with some of the same perps).

Penny

 Picard (obviously not the Captain)

In Eastern Hampshire District Court on Monday the Commonwealth originally was going to place each perp on "supervised probation" for four months with a $50/month supervision cost (paid to the Court) but the Probation officer told Judge Estes its never been done that way before.

 Buccelli

So they switched back to the usual way of handling these by converting the criminal charge to civil with payment of a $300 fine.  They are still on (unsupervised) probation for four months.

 Gonsowski

After all eight were dealt with the Judge even mentioned that it generated over $2,000 for the town.  I felt like interjecting, "And the taxpayers of Amherst thank you."