City of Atlanta announces class action lawsuit against management company of troubled Forest Cove Apartments

Owners of Forest Cove apartments hit with lawsuit

Atlanta Mayor Andre Dickens and attorney Ben Crump came together to announce the city is filing a lawsuit against the owner of the Forest Cove apartment complex.

ATLANTA - City of Atlanta Mayor Andre Dickens and civil rights lawyer Ben Crump held a press conference on Friday to address the conditions at the Forest Cove apartment complex in southeast Atlanta and a lawsuit filed against the city.

Residents of the apartment complex have long voiced concerns about unsafe living conditions, including issues such as mold, rodents, extensive trash, broken windows, abandoned vehicles, general disrepair, and criminal activity.

In July 2021, Atlanta police identified 150 code violations during an inspection of the property.

In May 2022, Atlanta City Councilman Jason Winston, who was also present at Friday's press conference, announced the passing of legislation to fund the relocation of Forest Cove residents using funds from the city's American Rescue Plan. Mayor Andre Dickens promptly signed the legislation, allocating $1.5 million for immediate relocation. In October 2022, Mayor Dickens announced that a total of $9 million would be spent to aid Forest Cove residents.

According to Mayor Dickens, the city successfully relocated 240 families, comprising approximately 800 individuals. He emphasized that despite not owning the complex, the city had an obligation to act, given the deplorable conditions residents were enduring.

Mayor Dickens also leveled strong criticism at Millennia Property Management Group, accusing them of neglecting the needs of Forest Cove residents. He asserted that if Millennia had its way, residents would still be living in dire conditions. Dickens further alleged that Millennia had evaded their responsibilities, despite numerous meetings with his team resulting in no tangible improvements.

In response to Millennia's lawsuit against the city, Crump announced that the City of Atlanta would file a class-action lawsuit. According to Crump, Millennia manages 280 apartment complexes in 26 cities, many participating in HUD rental assistance programs, with similar issues affecting residents in other locations such as Pittsburgh, Houston, North Little Rock, Birmingham, Memphis, and Jacksonville.

Crump also highlighted a class-action lawsuit filed by residents of Shorter College Garden Apartments in North Little Rock, following an explosion at the complex that claimed three lives on Oct. 4. The residents are seeking $5 billion in damages.

According to court documents filed in North Little Rock, Millennia's apartment communities, typically located in lower-income neighborhoods, house more than 86,000 people and employ over 1,110 individuals.

Before the press conference, Phoenix Ridge GA TC, LP, the property owner, issued a statement. Phoenix Ridge stated that their intention when acquiring the property in April 2021 was to invest $58 million in its redevelopment, allowing residents to return to upgraded homes. They claimed the relocation process was initiated following an order from the City of Atlanta's Municipal Court to demolish the property and relocate residents.

Phoenix Ridge alleged that rather than assisting residents, the City of Atlanta aims to gentrify the Thomasville Heights neighborhood, eliminating affordable housing in the process. They also noted the city's contractual right to secure the Forest Cove property in March 2022 but opted not to do so. Phoenix Ridge cited difficulties in securing tax credits and funding for the construction project, leading to the loss of HUD subsidies.

Following the press conference, Phoenix issued another statement. In this statement, they strongly contested the City of Atlanta's claims, asserting their deep concern for Forest Cove residents. They clarified their acquisition of the property was solely to relocate residents during a $58 million rehabilitation project. Phoenix Ridge insisted they had complied with all necessary approvals and permits from the City of Atlanta. They also refuted allegations of owing the city nearly $10 million in relocation fees, citing a breach of agreement by the city, upheld by the Fulton County Superior Court.

Phoenix Ridge vehemently denied turning a blind eye to Forest Cove residents and accused the City of Atlanta of prioritizing redevelopment over the needs of Forest Cove residents and suggested that the city was acting in its own interest rather than that of the residents.

READ FULL STATEMENT BELOW

The City of Atlanta painted a blatantly self-serving fabrication today regarding the Forest Cove Apartments and Phoenix Ridge and Millennia’s role in the property. As a company, we have the utmost respect and concern for the residents of Forest Cove, which is why we acquired the already severely distressed property in 2021 with the sole purpose of relocating the residents offsite while the property would undergo a $58M rehabilitation.

The City has chosen to prioritize gentrification of the Thomasville Heights area to the detriment of the residents of Forest Cove and to grant Mayor Dickens with a trophy achievement. These residents will not be able to return to their community, but Mayor Dickens will falsely position this as an affordable housing victory.

The City knows its claims that Phoenix Ridge had no concern for the Forest Cove residents and had no plans to improve the property are completely and utterly false. Phoenix Ridge only acquired the property as the company saw the need to immediately relocate the residents, which the previous owner would not allow. Phoenix Ridge allocated a $58M budget to the rehabilitation of this community and had received approval and permits to begin construction from the City of Atlanta. This rehabilitation would have ensured all rightful residents returned to the Forest Cove Apartment in updated, safer and more modern homes. Under the City’s current plans for Thomasville Heights, there are no plans for the volume of affordable, subsidized housing that would allow the residents of Forest Cove to return to their community.

The claim that Millennia and Phoenix Ridge owes the City almost $10M for relocation is patently false. There was agreement that the company would repay the relocation fees pending the sale or refinancing of the property. However, the City breached the agreement, blocking the sale or refinancing of the property, as upheld by the Fulton County Superior Court.

Phoenix Ridge has never turned a blind eye to the residents of Forest Cove, in stark contrast to the City of Atlanta's neglect in fulfilling its responsibilities with the necessary urgency. The deteriorated conditions of Forest Cove existed years before Millennia took over management of the property and bought it for the sole purpose of relocating and substantially transforming the property. Forest Cove has long been ignored by the City of Atlanta. At every turn, Phoenix Ridge has attempted to work with the City on this community. In fact, the City of Atlanta has had the contractual right since March 2022 to take steps to secure the property at Forest Cove but has chosen not to.

The City is right that the residents of Forest Cove deserve better, but halting the revitalization which would have seen the residents returned to newly renovated homes by now, in interest of redevelopment that does not provide adequate affordable housing but does increase the property value of Thomasville Heights, shows that Mayor Dickens and the City are only acting in their interest, not those of the residents of Forest Cove.

Millennia announced in late September that they were cutting staff and shedding 33 apartment complexes in the South.