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Judge Allows Forced Condo Sale to Move Forward

Fred Moorman is close to completing a takeover of the Heritage Square condos on Sunset Drive. Credit: Blake Aued

A long-developing real estate deal moved a step closer to fruition with an Athens-Clarke County judge’s recent ruling that a forced sale of Heritage Square Condominiums can proceed. Superior Court Judge Lawton Stephens had ruled verbally for Fred Moorman and his Fred Family Trust following a brief hearing the day before Thanksgiving, and entered his decision into the court clerk’s records Dec. 7.

Retiree Claire Benson, who’s lived in Heritage Square 22 years, had asked the judge to reconsider his August 2020 ruling granting Moorman’s request to “partition” the property—a forced sale. Moorman owns most of the units in the complex and has used his majority ownership to dissolve the condominium association, setting the stage for a forced sale, getting all of it into the hands of one owner.

The law of partition—sometimes called a forced sale—is more commonly used in situations when heirs to a piece of property can’t agree on some aspect of ownership, such as when brothers and sisters can’t agree about what to do with the family farm or the house a parent left jointly to all of them. But in this case, the partition is of a condominium complex.

In last month’s hearing, Benson, 73, and a witness she called, Joe James, repeated some of the charges she and other condo owners had leveled against Moorman in an earlier, unsuccessful lawsuit as Moorman acquired most of the units in the quiet 1970s complex. “The people who sold their property to Fred were bullied into doing that,” James testified.

No one in the room, including Benson, expected her to win her plea. Two lawyers sat near her behind the bar, but they were there representing the interests of other condo owners who haven’t yet sold their units. Benson said she couldn’t find or afford a lawyer and represented herself.

Starting 10 years earlier, Moorman had acquired 35 of the 46 units in Heritage Square by late 2016, said the Athens Banner-Herald in January 2017, after Benson and the other condo owners sued Moorman under Georgia’s civil racketeering law. In addition to Benson, the 2017 plaintiffs included former Athens resident and current DeKalb County CEO Michael Thurmond, former Athens-Clarke County Police Chief Jack Lumpkin and a disabled couple. Some, like Benson, had bought into the quiet complex thinking this would be ideal for their retirement years. Moorman used threats of eviction and other bullying tactics to buy up condos, and entered purchase prices in real estate records that were actually lower than what he paid, artificially lowering the value of the plaintiff’s condominium units, the plaintiffs charged.

Stephens dismissed the 2017 case as without merit, and later partially granted Moorman’s request that the plaintiffs pay his legal expenses. The judge ordered the plaintiffs and their lawyer to pay just over $78,000; Moorman’s lawyers had asked for $377,290.65.

The prospect of losing her home “has taken a tremendous toll on my physical, emotional and financial wellbeing,” Benson testified in last month’s hearing as she delivered what she called her statement of impact. She has invested more than $50,000 in her property since she bought it, including plumbing and electrical upgrades and a remodeled kitchen with wooden floors, she said. “It was a great place to live,” said Benson, who has COPD and hereditary arthritis.

The complex at the intersection of Sunset Drive and Oglethorpe Avenue is directly across from Bishop Park and its walking trails and other amenities, and within easy walking distance of the University of Georgia Health Sciences Campus, Piedmont Athens Regional Medical Center and bus lines. Real estate prices have skyrocketed in the Normaltown area around the health sciences campus, and replacing her condo with anything similar would cost her $450,000–$650,000, Benson estimates.

Now a court-appointed lawyer will have the four-acre property appraised, according to the court’s 2020 order. Then one of the current co-owners could buy the others out, paying them a proportionate share of the appraised value. If that fails, the property can be sold to the highest bidder at public auction on the courthouse steps.

Heritage Square units are worth about $120,000, although Moorman paid substantially less for many, and land in tracts adjacent to Heritage Square is worth up to $425,000 an acre, according to Clarke County tax valuations unchanged since 2017. The rental rates for Heritage Square units are $1,100 a month for two bedrooms, $1,300 for three bedrooms, according to the Fred’s Historic Properties website—about triple Benson’s $400-a-month mortgage. Assuming a $1,200 per month average rental take per unit and 90% occupancy of the 46 units, the complex can generate about $600,000 in rental income per year before maintenance costs, taxes and other expenses.