Albany legislators question land bank operations

Meanwhile, the land bank said it has faced overwhelming demand from real estate investors and speculators looking for good deals in distressed neighborhoods during the coronavirus pandemic, with the land bank averaging over 3,300 calls a month.

Several legislators said they had repeatedly heard complaints from constituents about the land bank and its operations, including a lack of responsiveness, concerns over the upkeep of land bank-owned properties and questions on how properties were awarded for sale.

The land bank was created in 2014 and is funded by the county and city, as well as state Attorney General’s office settlements.

Since its formation it has taken on more than 1,000 properties and sold more than 600 of them. Currently the land bank has dozens of buildings and more than 200 vacant lots for sale.

Todd Drake, a Republican from Latham, said legislators have expressed concerns for months about whether the land bank was moving quickly enough to reduce blight and get properties back on the tax rolls.

“No one is here to say the land bank is a colossal failure as an experiment, I don’t think that’s the tone of the conversation,” he said. “It needs to be more user-friendly, it needs to be easier to get a substantive deal in order to get these properties and put them back on the tax rolls and remove the blight from neighborhoods.”

Drake, who runs a real estate management firm, noted that while he hadn’t spoken directly with the land bank’s executive director, Adam Zaranko, he wanted to make sure those concerns were addressed.

In an interview, Zaranko said that the land bank had been crushed with demand during the coronavirus pandemic as investors looked for real estate deals. In August alone, the land bank received 5,900 calls from prospective buyers as far away as Australia. Many of them appeared to be the type of potential absentee landlords the land bank had been tasked with cleaning up after, he said.

“The problem is a lot of the folks that are looking for properties, and especially in distressed neighborhoods, either don’t have a good history of real estate stewardship or there’s a lot of predatory action,” he said

But even outside of the calls, 2020 has been the land bank’s busiest year yet, with nearly 880 applications so far, compared to its previous high of 450 in 2019.

A possible cause of some complaints is due to a change in the land bank’s strategy. For the first few years, the land bank was selling properties as they gained control of them. Those that needed to be demolished were torn down and others were sold to prospective buyers for rehabilitation.

In 2019 the land bank began a “cluster development” strategy. The land bank has built up dozens of connected properties in several neighborhoods in Albany and advertised them as potential projects for developers to take on.

Zaranko, the nonprofit’s executive director, said the idea behind the strategy is that a single vacant lot may not be appealing or have significant market value, but several lots connected to each other could be enticing to potential developers.