Slummin' It

Last Thursday, a City Council committee heard testimony about Robert N. Coyle Sr., the subject of an October 2009 piece by Daily News Pulitzer Prize-winning reporters Barbara Laker and Wendy Ruderman, who revealed allegations by tenants that Coyle had made false rent-to-own promises. Instead, residents found themselves facing eviction notices after Coyle defaulted on millions of dollars in mortgage debt, leaving more than 100 homes throughout Kensington and Port Richmond in the hands of the very banks that had loaned him so much money.

At Thursday's hearing, Council heard from disillusioned former tenants and victim advocates, who decried the fact that Coyle has still not been charged with any crime. They also brought up another party that, they say, hasn't done right by the neighborhoods affected: the banks, which loaned Coyle the millions he used to grow his holdings into a slum empire and which now sit, much as Coyle once did, on all those run-down homes.

Indeed, City Paper did its own investigation of the mechanisms by which Coyle acquired so many properties, and how he was able to borrow so much money on such run-down houses ["Default Lines," 6/9/10]. Among our findings were that a handful of local banks were all too happy to grant Coyle vast sums of money on the houses — far more, it seems, than they were worth. What's more, we found allegations by Coyle in court documents that at least one bank, Republic First (now Republic Bank), steered title insurance business to him (yes, he owned his own title insurance business) in exchange for his business and that the bank intentionally inflated the value of his properties to make their books look better. In one e-mail filed in court documents, a bank executive (no longer there) wrote Coyle: "I am doing everything in my power to get you title work."

Now residents and community groups want the banks to step up. Steve Culbertson, director of housing for Impact Services, testified that his nonprofit was ready to buy Coyle homes for redevelopment — but that the banks wanted $80,000 for properties his group had appraised at $20,000.

"My opinion is the banks are complicit in the activities of Mr. Coyle," he told the committee. "They made a lot of money on these loans. ... Now they've got to chip in [and] write down those prices."

As long as the banks sit on these properties, waiting, perhaps, for their values to go up or for another Coyle to buy them all up at once, they become the slumlords, and Philly's neighborhoods lose.

Isaiah Thompson is all too happy to grant vast sums of money. E-mail him at isaiah.thompson@citypaper.net.