Complexes under stress face scrutiny

by Edythe Jensen - Mar. 1, 2009 12:00 AM
The Arizona Republic

Liens, lawsuits and rumors of financial troubles at a California company that owns 12 large apartment complexes in the Valley and many others across the nation have Valley officials and tenant advocates worried.

Bethany Group, based in Irvine, Calif., owns complexes such as the Coves at Newport on West Thunderbird Road in Glendale.

Glendale spokeswoman Julie Frizoni said the city is preparing to send out 25-day water-shutoff notices this week to some residents there because management hasn't paid bills for two of 11 buildings since December.

"It's very scary for the tenants living there," she said.

Meanwhile, company employees are exchanging dire e-mails about unpaid wages and lack of money to provide tenant services.

Cameo Dawn, manager for the Coves, did not return phone messages.

If the financial difficulties worsen or if there are foreclosures or a bankruptcy, tenant advocates say residents in Bethany's other Valley complexes could see lax maintenance and utility shutoffs or have difficulty getting security deposits returned when they move.

Mark Wirth, who represents Tempe-based Arizona Bethany Group LLC, which has no connection to the apartment owner, said that for the past few months, he has been bombarded by bill collectors, letters and process servers from companies suing the other company.

"We keep telling them, 'I'm not the right guy,' that we're just a small land-appraisal group," Wirth said.

Public records show liens and lawsuits have been filed against the California Bethany Group in Arizona and California in recent months. Eight court judgments were recorded in Maricopa County in February by Arizona Carpet Care against the apartment owner's properties including Madera Court, Valencia Park, Sienna Springs and Granite Bay in Phoenix; Laguna Village in Chandler; Scottsdale Springs; the Coves at Newport in Glendale; and Tuscany Palms in Mesa.

Cheryl Credio, manager for the 320-unit Alante at the Islands complex at McQueen and Warner roads in Chandler, said rumors that employees aren't being paid are false. She referred calls to Bethany Group CEO Greg Garmon in Irvine. Garmon did not return telephone messages. However, a woman who said she was representing the Bethany Group but refused to give her name called and instructed The Arizona Republic to stop calling their employees "because it is disruptive." She referred calls to Laura Smith, a regional vice president based in Arizona; Smith did not return phone messages.

Pam Large, an official in Chandler's Neighborhood Resources office, said she recently received a tenant complaint about plumbing damage in Alante and is concerned about rumors of financial troubles because there are three large Bethany Group-owned complexes in the city that house thousands. Another Chandler complex, Crosswinds on South Arizona Avenue, has recently been the subject of numerous resident complaints to the city about pest infestations, lax maintenance and crime problems. Credio, the Alante manager, said the plumbing complaint was made by a vocal tenant after the renter above him had an overflowing toilet. The problem was fixed, she said. Property records show the Bethany Group purchased the two Chandler complexes in 2007: Alante for $40.8 million and Crosswinds for $21 million.

Ken Volk, founder and president of Arizona Tenants Advocates, said his organization has recently helped several Bethany Group complex tenants who sought help breaking leases because of reputed physical violations by the landlord. He said his group documented eight cases with serious and multiple violations and he is worried that a bankruptcy or foreclosure of Bethany properties could force thousands to move.

Renters have some recourse if critical maintenance work isn't being done or their utilities are being shut off for management non-payment, said Stan Friedman, a volunteer attorney and tenant advocate in Chandler San Marcos Justice Court. They can give the landlord 10 days' written notice that they're breaking a lease and moving out because the apartment is uninhabitable, he said.

The portion of the Bethany Group's apartment Web site that lists property addresses has been unavailable for several days. A brochure distributed at Alante shows 14 Valley complexes in Phoenix, Mesa, Chandler, Tempe, Scottsdale and Glendale.

Credio said the Bethany Group no longer owns two of them.

Reach the reporter at edythe.jensen@arizonarepublic.com or 602-444-7939.

Bethany Group Valley complexes:

• Granite Bay, 14230 N. 19th Ave.
• Madera Court, 8135 N. 35th Ave.
• Sienna Springs, 5128 N. 16th St.
• Valencia Park, 5104 E. Van Buren St.
• Tuscany Palms, 901 S. Country Club Dr.
• Whispering Meadows, 1050 S. Longmore St.
• Alante at the Islands, 2222 N. McQueen Rd.
• Laguna Village, 102 W. Palomino Dr.
• Crosswinds, 868 S. Arizona Ave.
• Tela Verde, 5020 W. Thunderbird Rd.
• The Coves at Newport, 5205 W. Thunderbird Rd.
• Scottsdale Springs, 7791 E. Osborn Rd.

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