Pasadena Joins Retirement Foundation in Purchasing Concord Apartment Units

Times Staff Writer

The Retirement Housing Foundation and the city of Pasadena have purchased the Concord senior citizens apartment building out of bankruptcy for $1.35 million, plus the assumption of a remaining $2.2-million federal loan.

Officials of the city and the nonprofit foundation said they will maintain the 14-story structure as a rent-subsidized apartment building for senior citizens and the handicapped until the year 2031.

Judge William J. Lasarow approved the sale Monday at an auction in U.S. Bankruptcy Court after the other major bidder, the Salvation Army, withdrew at $1.3 million.

The property was sold to benefit the creditors of the Concord Senior Housing Foundation, part of an empire that was created in Glendale and Pasadena in the 1960s and 1970s by the Rev. William Steuart McBirnie and that is now mired in litigation and debt.


The legal and debt problems were blamed for a rift among McBirnie’s former congregation at the Church in Glendale at 333 E. Colorado Blvd. The church’s minister, the Rev. John Myrick, and about half of the deacons resigned last summer after members split over whether to sell the church to repay money that former parishioners had loaned to McBirnie’s organizations.

Myrick resigned after a majority of members voted in June not to sell the church and adjoining buildings, worth an estimated $8 million. The Rev. Norm Lewis, a former missionary in Argentina, has served as interim pastor since, said Orville Burris, chairman of the deacons.

Attorney Christ T. Troupis, representing 53 of the 385 creditors who stand to benefit from the sale of the Concord, said he is pleased by the price.

Troupis said the claims against the Concord Senior Housing Foundation total about $3.7 million. Most of the creditors, he said, are elderly people who attended services at McBirnie’s United Community Church, later named Church in Glendale, or listened to his Voice of Americanism broadcasts and loaned money to his enterprises. McBirnie resigned as minister of the church in 1986.

After trustee fees and other bankruptcy expenses are deducted, Troupis said, there should be enough money from the sale to pay about 25% to 30% of the creditors’ claims.

The balance of the claims are being sought in suits against the church property in Glendale.

Tenants of the Concord apartments hailed the sale of the Pasadena building as a guarantee of stability for the future.

Eighty-year-old Clements Gordon said tenants will be delighted to have the Retirement Housing Foundation, which is affiliated with the United Church of Christ and manages 90 housing projects in 22 states, take over the Concord.

“We were overjoyed to have them buy it,” Gordon said. She said that the foundation managed the 150-unit complex several years ago and treated the tenants well. The foundation manages two other low-income senior citizens complexes in Pasadena, Pilgrim Tower East and Pilgrim Tower North.

The city Fire and Police Pension Fund will provide the money for the purchase as a long-term investment. The city will own the land, and the Retirement Housing Foundation will own the building while the mortgage with the U.S. Department of Housing and Urban Development is being repaid. The mortgage, which currently amounts to $2,292,643, will be paid off in 2016.

City Director John Crowley said that once the mortgage is repaid, the city will take ownership of the building but Retirement Housing Foundation will continue to run the complex. Crowley said the plan is to continue operating the building as a rent-subsidized housing project until 2031, when a city lease with the neighboring Holiday Inn will expire and the city can consider what to do with the entire block, which includes the Pasadena Conference Center.

Crowley said the agreement between the city and the foundation is still in draft form and must be completed before escrow closes in about 60 days.

Before bidding on the property, Crowley and other Pasadena officials went to Washington in November and obtained a commitment from HUD to pay for fire sprinklers at the Concord. The city has adopted an ordinance to require buildings of 5 stories or more to install sprinklers. HUD officials estimate the cost of installing sprinklers at $315,000 to $495,000.

William Reynolds, city development director, said he believes the Concord also needs roof and elevator repairs, but that these expenses can be covered without additional cost to the city. Rent payments and subsidies generate money to pay for upkeep and repay the mortgage loan.

Crowley said the $1.35-million purchase price cannot be recovered from rents or rent subsidies, but he still considers the expenditure a good investment.

The purchase eliminates uncertainty for tenants, he said. “We will assure them of a stable ownership and operation. That’s a major accomplishment.”

In addition, he said, the Fire and Police Pension Fund will benefit by listing the Concord as one of its assets.

And, he said, the city will acquire control over a key property in the same block as the Pasadena Conference Center.

The other principal bidder for the Concord was the Salvation Army, but its representative at the auction, Capt. Michael Olsen, said he could not compete against the resources of the city. “We were bidding donated funds against tax dollars,” he said.

Any buyer of the property would have been bound by the terms of the settlement of a federal court case that was initiated by tenants in 1982 after the owner of the Concord tried to pay off the HUD mortgage, double the rents and sell the building. The settlement prevents prepayment of the mortgage and requires the building to remain as rent-subsidized housing until 2016.

One bidder at Monday’s auction did not realize that the buyer had to assume the mortgage. The bidder, Mani L. Bhaumik, representing Cosmogenics Inc., a maker of educational films, offered a high bid of $1.65 million. But when Judge Lasarow asked Bhaumik if he understood that the property had a mortgage on it, he said he did not, and was allowed to withdraw his bid.

A second round of bidding ensued, and the Retirement Housing Foundation and Pasadena offered the high bid of $1.35 million. The price was lower than they had offered in the first round, when they dropped out of the bidding at $1.6 million.

Times staff writer Martha Willman contributed to this story.