Wilmington’s land bank has been in the works for several years now, and is expected to launch early next year.
Land banks use public/private partnerships to address abandoned properties causing blight by acquiring, managing, maintaining and transferring them to more responsible owners.
Lee Huang is Senior Vice President for E-Consults, and interim moderator for Wilmington’s land bank until an executive director is hired by the end of the year.
He said the city’s blighted properties currently create an aggregate property value loss of around $400 million each year.
“In many cases, the entire structure just needs to be demolished," Huang said. "Either because it is so far gone or because it is, in a sense, functionally obsolete.”
He notes row houses are often considered functionally obsolete because of their small size.
Frank Alexander, co-founder for the Center for Community Progress and a land bank expert, says row houses are also challenging because they’re more costly to update or demolish than a single home because the entire unit is affected – costing at least $50,000 to $100,000 to clean up as opposed to $5,000 to $10,000 for single structures in cities like Flint, Michigan or Atlanta, Georgia.
He adds Delaware and Wilmington also have outdated code procedures, which rely heavily on ineffective criminal enforcement.
Alexander recommends the city utilize civil liability actions that often result in a land bank acquiring the property.
“So fix it up, pay it up or give it up and if you’re going to give it up we want clean, insurable, marketable title in a new owner and that’s when you need the land bank," Alexander said.
Wilmington’s Director of Planning and Development Leonard Sophrin said the city is working to make those code adjustments.
He added the city has already made its first investment in the project - $1.5 million.
“This is sort of like a marriage," Sophrin said. "Everybody is stepping into this together and the city’s contribution represents the first important step. Because if the city is willing to put money into the land bank, it is intended to leverage.”
Sophrin said the projected annual cost to run the land bank will depend on how many properties it chooses to wrestle with during its first few years.
He noted not all of the city’s over 1,500 vacant or abandoned properties will be acquired by the land bank right away.
Decisions on how many homes and what areas to prioritize will be made once an executive director is selected later this year.