Goodwill hawking: Mark-Taylor Residential

Although the financial gurus didn't officially declare the recession until last December, apartment developers have been virtually frozen out of construction financing for more than a year and acquisition loans have been hard to obtain.

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Dale Phillips, president of Mark-Taylor Residential, one of the largest apartment developers and fee managers in Phoenix, believes that perfect opportunities for charitable donations present themselves in periods of slow development growth.

For the past two years, Mark-Taylor has partnered with the Save the Family Foundation to provide a rent-free apartment to a client of the 21-year-old, Phoenix-area non-profit that helps homeless families become self-sufficient.

This year, with so many Americans facing financial ruin, the Scottsdale-based apartment firm decided to do more, donating 12 apartments to families in crisis. “The need is certainly great and we wanted to do what we could,” said Phillips.

Nearly 3,000 people are living on the streets in Phoenix — an increase of 20 percent from the year before, according to a recent count of homeless people conducted by the Maricopa Association of Governments in January. And that doesn’t include the number of homeless people living in shelters.

The total number of homeless families increased 370 percent over the past year in Maricopa County, to an estimated 12,000 people, ten percent of them children. Many agencies serving homeless and low- income people, including Save the Family, report a large increase in people who have never needed help before seeking assistance, due to the downturn in the economy.

And, while things aren’t rosy for the nation’s apartment industry this year, Phoenix, with an employment base largely reliant on the housing industry, is feeling some real pain. Exacerbating the problem is an oversupply of apartments, thanks to overzealous developers who delivered 3,800 units in 2008 and are expected to complete another 3,100 this year. According to Marcus & Millichap, apartment vacancies in Phoenix ended the first quarter at around 11.3 percent and are forecast to reach 12.6 percent this year.

Andrea Soka, director of community relations for Save the Family, wants property owners and managers to know they can make empty apartments available to help families in need. “Why let them stay vacant when they can go to such a great use,” she said.

Phillips, however, says his company’s decision to increase donations to Save the Family this year was not at all occupancy-based. Mark- Taylor is out-performing the market, as Phoenix heads into the slow summer leasing months, with occupancy averaging 91 percent for the 10,000 units the company manages, 95 percent for third-party clients.

“We realized last year, when business was actually better, that we wanted to have a greater role in Save the Family. I’m confident that had our occupancy been 95 percent, we would have done the same thing,” said Phillips.

Save the Family was founded in 1988 in response to the need for a comprehensive community service dedicated to helping homeless families with children transition to self-sufficiency. In 1989, the organization housed its first four families in a four-plex in Mesa, a Phoenix suburb, that became part of the group’s Transitional Living Program, which has grown to encompass 80 such housing units throughout the Valley of the Sun.

The model is based on the belief that what homeless people really need is a helping hand, not a handout. That premise has proven effective for approximately 90 percent of the clients who have completed Save the Family’s program. Typically, they successfully transition back into the community within an average of eight months.

“We tell our clients they are ambassadors, showing the community that homeless families are not lazy, they are not dirty, they are just struggling,” said Soka.

Participating families have access to Save the Family’s career development center that provides job training, clothes for interviews and a place where they can use a computer and printer to find and follow up on job leads.

This year, the 12 families that will reside in a Mark-Taylor luxury apartment, where rents average $990, will be selected on a rolling basis. To qualify, they must be enrolled in Save the Family’s program and the head of household must be employed, with an income at least 30 percent above the area’s poverty level.

Residents do pay between $300 and $500 per month, depending on their income, to Save the Family, which saves the entire amount for them in an account they can access when their lease expires to pay off debt, pay for schooling or use in concert with a government matching fund to make a down-payment on a home.

And, when their year with Mark-Taylor is over, some residents might even renew their leases and become rent-paying residents, like their neighbors.

So far, six families have moved in. This year, Mark-Taylor has been instrumental in stocking the apartments with necessities like paper towels, diapers and other goods for the new residents.

“During the first two years, when it was simply one unit we were donating, Save the Family relied on partnerships in the Valley with Cort Furniture Rental or Terri’s Consign and Design, for instance, but with the increase in demand, not just on 12 units, but the overall demand on the non-profit, they have exhausted all of their furniture resources. So we have come together to do whatever we can, providing couches, beds, chairs and a lot of cabinet stuffers every chance we get. We’ve been lucky to have been able to do it quite a bit, but its not set in stone we can do it for everyone,” said Phillips, adding that sometimes families have items in storage they finally are able to retrieve.

The entire Mark-Taylor organization has embraced the program and the Save the Family process, and employees from other properties in the company’s portfolio gather to welcome the new families on move-in day.

“When our employees returned to their own communities, they’d say, ‘I wish I had a family living here,’ so this year, by donating 12 units, we’ve been able to respond to that request. And when we’ve asked our people what the high point of the year was, some have said it was being part of that charitable organization,” said Phillips.