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Bank moves to foreclose on failed New Horizons property

May 10, 2012|By Brittany Levine, brittany.levine@latimes.com
(Times Community…)

Another blow is coming by way of the New Horizons Family Center. Its lender, Bank of the West, has scheduled a foreclosure sale for the end of the month — a move that likely will prevent Glendale from recouping $16,000 the city is owed by the now-defunct nonprofit.

The bank’s roughly $1.07 million foreclosure sale is set for May 24. But Glendale is so far down on the list of creditors that it probably won’t see a penny.

“Unfortunately, it appears there may not be anything left over for us,” said city spokesman Tom Lorenz.

The foreclosure announcement comes a few weeks after the city declined a proposal by PATH Ventures, a Los Angeles-based affordable housing developer, to purchase the vacant property on the 1200 block of South Maryland Avenue for $1.4 million.

New Horizons had planned to build a childcare center on the site near its mental health facility, spending federal housing funds allocated by the city for an expansion that never panned out.

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Part of the PATH Ventures deal required the city spend $2 million to develop an affordable housing project, which officials said wasn’t financially feasible.

New Horizons — which provided child-care services to low-income families in Glendale from 1994 through last year — filed for bankruptcy in October after receiving more than $1 million in federal Community Development Block Grants and stimulus money for social services and capital improvements over the course of a decade.

“I think it’s just a sad chapter in the history of the relationship between Glendale and nonprofits,” said Councilman Ara Najarian, who called for an apology from the nonprofit’s former board of directors and former Executive Director Maria Prieto.

Speaking of the silence from those involved with New Horizons, Najarian said “they owe it to the city and to the residents to explain what’s going on.”

Prieto didn’t return requests for comment.

New Horizons sold its former headquarters at 744 S. Glendale Ave. for $1.73 million last summer in order to pay off some debt, but it still owes the U.S. Department of Housing and Urban Development roughly $240,000.

New Horizons also owes Glendale $16,000 for canceling mental health counseling services, according to city records.

The city is not liable for the grant money owed to HUD, Lorenz said.

Although Bank of the West was the first to issue a notice of trustee sale, it’s not the only creditor that had wanted to foreclose on the property.

After Glendale-based George Hopkins Construction Co. filed a $200,000-lien against the property, its president, Gary Hopkins, said last month the company was mulling over foreclosure.

But the bank beat them to the punch.

“We are still looking at options. No decision has been made on our part,” Hopkins said in an email.

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