Committee Backs Loan to Rebuild Apartments for Poor Tenants : Housing: City panel tentatively approves $900,000 for agency to acquire quake-ravaged structure in Reseda ‘ghost town,’ salvaging affordable units.

Taking a new tack to rebuild the most vulnerable of quake “ghost town” buildings, a Los Angeles housing panel tentatively approved a $900,000 loan Monday to restore a crumbling Reseda apartment complex for low-income tenants.

City housing officials say the loan is the first of its kind, aimed at increasing low-income housing by salvaging financially troubled buildings, primarily within the 15 designated ghost towns. Those structures would otherwise sit neglected for months, perhaps years, attracting graffiti, crime and vermin.

“We are trying to encourage the nonprofits to come out and eat these properties up,” said Beth Bergman, a finance officer for the city’s Housing Department.

The loan, which was approved by the City Council’s Housing and Community Redevelopment Committee, would provide enough money for the Los Angeles Community Design Center to buy the severely damaged 64-unit apartment building at 7939 Reseda Blvd. The nonprofit group has also requested a second loan for about $600,000 to rehabilitate the building.

The entire council must still give both loans final approval, but no opposition is anticipated.

The building, red-tagged to indicate it is uninhabitable, is located in the middle of a chain of vacant, quake-damaged structures along Reseda Boulevard and is already in foreclosure. It shifted off its foundation during the Northridge earthquake and is now leaning noticeably, although a “Now Renting” sign remains on its front facade.

Housing officials say they are not sure how many damaged buildings may be turned into low-income housing projects, but they hope the strategy will save at least some of the hundreds of vacant apartment complexes that have become magnets for blight.

“It’s part of a long-term strategy,” Bergman said.

Under the loan plan, the Los Angeles Community Design Center will redesign the buildings, reducing the number of units to 46 to allow for bigger apartments to house larger families.

The three-bedroom units will rent for as little as $338, and the four-bedroom apartments from $365, said Anne Sewill, executive director of the design center.

Once the building is restored--perhaps in about a year--the center will retain ownership of the property but plans to hire a management firm to operate the complex, officials said.

Sewill said that before the quake, many low-income families lived in apartments in the Reseda neighborhood, but they were forced to double up in small units because they could not otherwise afford the rents.

By making the units larger and reducing the rents, she said, the building will allow poor families to return to the neighborhood and live more comfortably.

Sewill said her group has already begun negotiations to buy and restore other quake-damaged buildings in the neighborhood and in other ghost towns throughout the San Fernando Valley.

An aide to Councilwoman Laura Chick, who represents Reseda, said she supports the loan proposal because the property might otherwise sit idle for months without repairs or be sold to an absentee landlord who might repair the building but fail to maintain it.

Ken Bernstein, Chick’s planning deputy, called the Los Angeles Community Design Center a “top quality” developer and added that low-income housing is badly needed in the Valley.

“There is a need everywhere in the city for quality low-income housing,” he said.