Imam in mosque debate has history of tenant troubles

Imam in mosque debate has history of tenant troubles

Sunday, August 29, 2010  The Record

The Muslim cleric at the center of the proposed mosque and community center near Ground Zero is also a New Jersey landlord who got more than $2 million in public financing to renovate low-income apartments and has been beset for years by tenant complaints and financial problems.

Imam Feisal A. Rauf won support for his Hudson County projects from powerful politicians, among them Robert C. Janiszewski, the disgraced former county executive. He also was awarded grants from Union City when U.S. Sen. Bob Menendez was mayor.

The proposed $100 million development two blocks north of Ground Zero has sparked a firestorm of emotions.  Menendez recently added his name to the list of prominent supporters, which includes New York City Mayor Michael Bloomberg.
Rauf forged ties with Fred Daibes, the prominent waterfront developer and bank chairman. Additionally, Rauf is a onetime business ally of a Daibes associate who sued the imam for alleged mortgage fraud. The 2008 suit was quietly settled in June.

The revelations about Rauf, who lives in North Bergen, add another dimension to the public profile of a man both lauded as a builder of bridges between diverse religions and cultures and vilified as being insensitive to the survivors of the Sept. 11, 2001, terrorist attack by proposing a mosque near the World Trade Center site.

Best known as the religious face of the controversial proposal, called Park51, Rauf, the revelations show, has had some success navigating the realm of secular power — in this case the rough-and-tumble world of Hudson County government.

In conjunction with others, Rauf is now taking on the largest project of his life with a track record showing that, despite government subsidies, he has had trouble maintaining small apartment buildings in North Bergen, Palisades Park and Union City.

Page after page of municipal health records examined by The Record show repeated complaints ranging from failure to pick up garbage, to rat and bedbug infestations and no heat and hot water.

Cynthia Balko, 48, of Union City — a longtime tenant of Rauf’s — said she’s had to live with rats, leaks and no heat: “I don’t have anything nice to say about the man.”  She finds it hard to believe Rauf’s going to build a world-class Islamic community center, with fitness facilities, auditorium, restaurant, library, culinary school and art studios, as well as a Sept. 11 memorial and space for Muslim prayer services.

“He can’t even repair the bells in the hallway.  He doesn’t take care of his properties. But he’s going to take care of a mosque?”

Studied at Stevens

Rauf is traveling in the Middle East on a tour funded by the State Department and could not be reached for comment; he was in Bahrain last week.

His wife, Daisy Khan, who has been the public face of the project while her husband is overseas, commented for this story, first in interviews and in an e-mail.

She maintained Rauf’s business dealings in New Jersey have “no relevance to the Park51 project.

“The Imam does not get paid for his spiritual work or work as an Imam,” she wrote in the e-mail late Friday. “He invests in real estate, much as someone would invest in stocks, bonds or other assets to secure one’s future and provide an income stream. He has dedicated his life to helping others working as an Imam.”

The 61-year-old Rauf studied physics at Columbia University during the late 1960s, then earned a master’s degree in plasma physics in 1972 at Stevens Institute of Technology in Hoboken. Kuwaiti-born, Rauf followed his father’s path, however, and became a Muslim cleric.

For years, he was also a popular leader of a mosque on West Broadway in lower Manhattan. After the 9/11 attacks, he was widely depicted as a moderate voice among American Muslims. In recent years, Rauf conducted cultural-awareness training for FBI agents in New York and has been dispatched several times by the State Department to Arab nations to speak about religious tolerance in America.

In response to the tenant complaints, Khan said: “All of these complaints are being addressed as they come up. Bedbugs: We fixed it. Every violation that comes up, we have addressed.”

Records show that in general the problems were resolved after complaints were lodged with officials; often, the problems reoccurred.

Khan blamed tenants for some of the problems at the Central Avenue building, where Balko lives.

“The tenancy is the kind of tenancy where there is vandalism,” Khan said, adding that they have had to repeat repairs.

“Unfortunately, people make mistakes — including those who are hired to fix and maintain the apartments and have to come back, and from time to time some people just cannot be made happy,” she wrote. “Even in those instances, however, the Imam instructs the people responsible for maintaining the apartment to continue to try to make all of the people satisfied. This is very important to the Imam.”

Loans and grants

From the late 1970s to the mid-1980s, Rauf acquired five apartment buildings in Union City and one each in North Bergen and Palisades Park.  Union City’s Community Development Agency awarded three grants, totaling $384,000, to renovate three of his properties in 1989 on the condition that he retain the properties for seven years, records show.

Menendez, mayor at the time, could not be reached for comment, according to a spokesman.

Three years later, two of those buildings on Bergenline Avenue also received nearly $1.3 million in construction loans from Hudson County’s affordable-housing trust fund and $630,900 from the state with the provison that the units be rented at “affordable” rates through 2017.

Rauf met with Menendez in late 1991 before applying for the state funds, and months later made a pitch to the mayor for $80,000 in city funds to help carry him until the loans came through, documents show.

Forced to halt construction on one project due to the unavailability of city rehab funds, Rauf wrote to Menendez in March 1992 that he was tapped due to “heavy and unforeseen additional carrying costs,” estimated at $87,000. “Having incurred total losses of over $266,000 over the last four years in losses and carrying costs while vacating the properties in order to rehab them, plus substantial construction costs to date, I find myself unable to come up with any more money right now.”

It could not be determined if Rauf got the requested city assistance, but two weeks later he received a letter from Janiszewski informing him that county officials had approved his application for $1,295,000.  “I thank you for your commitment to providing affordable housing to the residents of Hudson County,” wrote Janiszewski. A decade later, Janiszewski would go to prison after admitting he pocketed over $100,000 in bribes from county vendors. Those charges were not related to his dealings with Rauf.

Rauf’s financial troubles intensified. One lender initiated a foreclosure action in July 1992 on a $400,000 mortgage on the Bergenline Avenue properties. Another sued in 1995 to foreclose on three loans, totaling $1.65 million, on the Central Avenue and Monastery Place buildings in Union City and the Lincoln Street property in Palisades Park.  All were resolved without foreclosure.

Financial woes still beset the cleric. In October 2008, Rauf and his wife were sued by onetime Edgewater business associate James Cockinos, who claimed they misrepresented their ownership of the 32-unit apartment building at Central Avenue and 22nd Street when he gave them a $250,000 mortgage in 1997.

Without telling Cockinos, the suit alleged, Rauf and Khan transferred ownership to another firm they owned and then obtained a $650,000 mortgage on the same building from a bank. After the building was damaged by fire in February 2008, Rauf and Khan stopped making mortgage payments to Cockinos, a former key executive at Daibes’ Mariner’s Bank. When Cockinos tried to foreclose, he discovered Rauf and Khan had switched ownership and filed suit alleging “fraud.”

The case was settled shortly before a June 28 trial, with Rauf and Khan agreeing to pay off the mortgage to Cockinos within the next few years, said the couple’s lawyer, Richard Rosa of Hackensack.

Rosa said that while there were two mortgages, there was no fraud. He attributed the problem to an “honest mistake.”

Complaints at Rauf’s Palisades Park building in the late 1980s and mid-1990s paint a picture similar to the one in Hudson County, with piles of garbage, weeds and overgrown grass among the concerns. Heat, roaches and “filthy halls” are cited in local records.

“He wasn’t a good landlord," said Jad Mihalinec, the health officer in Palisades Park.  Building manager Daibes, a developer of luxury towers along  the Hudson, was the construction contractor on the publicly financed Bergenline Avenue rehabilitation project and said he was recommended to Rauf by Hudson County officials.

Later, another Daibes company managed Rauf’s buildings; Daibes said the relationship began because Rauf was traveling out of the country. Daibes said his DBR Management Inc. oversaw Rauf’s assets for perhaps two or three years. DBR’s name appears on some of the violation notices, warning letters and health department complaint logs.

“We collected rents and paid the bills,” said Daibes, noting that Rauf had a building superintendent “Mr. Daibes managed the buildings from 1992 to 1997,” Daisy Khan wrote. “He was responsible for the daily upkeep of the properties, handling finances including rent collection and bill payments.”

Daibes did not return a call for comment on Khan’s recollection of his duties.  Daibes said he is surprised by all the publicity Rauf is getting today, recalling him as a “simple guy that owned a couple of buildings in Union City — not a man of wealth or substance. He wasn't an imam back then, but he was religious.”

He said they got friendly — Rauf felt comfortable with him because he spoke Arabic — but didn’t socialize.

“What we talked about is basically how he was looking to find investors so he could get into the development business,” said Daibes, who described himself as a Lebanese Christian.

But Daibes said he “was not impressed” with Rauf as a businessman.  “The truth of the matter, and now it makes sense, in hindsight, he was more focused on religion than business.”

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