Phoenix-based Urban Communities began buying multifamily buildings in Detroit’s Palmer Park neighborhood near the city’s northern border in 2020, but the company’s portfolio later deteriorated into receivership, foreclosure or severe distress for all 21 buildings, according to court records and other materials reviewed by Outlier Media and distributed by The Associated Press.
Close to two dozen buildings are described as practically abandoned, putting the viability of the neighborhood and its historic structures at risk. Phoenix-based Urban Communities, which began acquiring the properties in 2020, had taken on the entire 21-building portfolio within about a year, and listings and records described by the reporting later showed widespread neglect and financial breakdown.
Wayne County tried to market five of the buildings it seized for unpaid taxes in a special auction earlier this year, but none of the properties drew a bid. In one example, an inspection report of 361 Merton Road described stolen electrical wiring and much of the plumbing, fire damage in several units, unsecured stairs and paint and plaster coming off the walls throughout the building. The report said, “Getting this building back to an occupiable condition will be a significant undertaking.”
A court-appointed receiver, Frank Simon, was tasked with marketing 14 of the buildings for sale. Simon said he inherited a rough situation, describing that “(The portfolio) definitely was not in good shape at all” and adding, “It was not managed well and had much deferred maintenance.”
Tenant accounts and inspection details described multiple maintenance failures tied to the Urban Communities operation. Dayton Martindale rented an Urban Communities apartment for about seven months starting in June 2022 and said that after moving in, he found his stove and oven broken and put in a work order. Martindale said repairs took more than a month despite visits to the front office and follow-up emails requesting service.
Martindale said that after he withheld a month’s rent because he couldn’t cook, Urban Communities filed for eviction, and that he paid the rent and continued living in the apartment. He later reported a break-in in which someone stole his bike and other belongings; he said he notified management and requested repairs to his door. Martindale said management promised “emergency maintenance” to fix the doorknob but that it was never fixed, adding that he moved out about a month later without a working doorknob “that whole time.”
In a statement sent by email to Outlier Media, attorney Edward Lennon—who represents Urban Communities and its CEO, Maximiliano Palacio—blamed Urban Communities’ collapse on several factors, including increased construction costs, nearby crime, and the 36th District Court’s “refusal to enforce evictions for non-payment.” The reporting also said the company had trouble getting renovations approved by the city’s Historic District Commission.
The historic district itself is characterized as unusually apartment-heavy for Detroit. The Palmer Park Historic District is almost exclusively apartment buildings, with 57 buildings identified in a report prepared for the Detroit Historic District Commission, and it includes architectural styles such as Moorish, Art Deco, Tudor-Revival and Modern. Detroit historian Amy Elliot Bragg said the density, diversity and beauty of Palmer Park’s buildings are what make them “a really one-of-a-kind collection that you don’t see anywhere else in the city.” Bragg also said, “Each individual apartment building is historically, architecturally significant in its own way,” while the district as a whole benefits “from the density and the continuity of the neighborhood.”
Reporting using court records and filings at the Wayne County Register of Deeds described a rapid expansion followed by worsening finances and maintenance problems. The article said Urban Communities did not list purchase prices on the deeds it filed, but it took out several mortgages while struggling to maintain properties and pay bills. Court material referenced in the reporting also said Urban Communities stopped paying at points in 2023 and that contractors filed liens for unpaid work, including roofing under a $214,000 contract, after which a contractor said the company still owed roughly half the amount.
By 2025, the article said the tax debt for the entire portfolio ballooned to more than $4.1 million. The reporting also said Urban Communities’ lender and trusts involved with the properties settled and that the equity investors were wiped out, with Lennon saying Urban Communities and its investors were “wiped out of their equity investment,” rendering “a loss in excess of $17 million.”
In the aftermath of the financial collapse, the article said Urban Communities sold one property in February with more than $122,000 in tax delinquency. It said a property lost to tax foreclosure was sold at auction in September to a bidder based in Naples, Florida for $35,000, and that a spokesperson for the treasurer’s office, Adam Abusalah, said the county would hold another auction at a later date for the five properties that did not sell.
Some residents still lived in buildings connected to the lawsuit, according to Simon. He said the lender had put a “substantial” amount of money into renovations but declined to say how much, and he said several companies had put in offers for the portfolio. Former tenants Martindale and Emma Greschak also took the company to small claims court for their security deposits; the article said Urban Communities did not send a representative to hearings, and both tenants won default judgments but did not receive the money they sought.
Martindale said he had to pay money, do additional investigation and go to court to be told he was owed his security deposit, then never got it back, adding, “One can only assume this happened to every single person who lived there.”