The city of Cincinnati is suing institutional landlord VineBrook Homes, saying their business model is a public nuisance. The city also says VineBrook violated the terms of a settlement in a previous lawsuit.
The city is asking a Hamilton County judge to appoint a receiver to take possession of the properties.
“We have no tolerance for investors who come into Cincinnati, let properties degrade and exploit tenants," said Mayor Aftab Pureval in a statement. "VineBrook's neglectful behavior has caused significant harm to renters, and the city of Cincinnati will fight back with everything we have to protect our residents."
VineBrook owns at least 964 properties in Cincinnati, and more than 3,000 in Hamilton County overall. The ownership is split between at least 62 LLCs registered throughout Ohio, a practice the lawsuit says is a way to intentionally avoid city oversight.
The city sued VineBrook in 2021 over hundreds of thousands of dollars in past due fines and fees related to health and building code violations. At the time, the city was aware of only 16 LLCs and only named those 16 in the lawsuit. The lawsuit ended in a settlement, but the new complaint alleges VineBrook violated several parts of the settlement agreement.
“This administration is committed to holding problem property owners accountable," said City Manager Sheryl Long in a statement. "VineBrook has had the opportunity to address ongoing issues, but instead continues to fall short."
A VineBrook spokesperson declined an interview but provided a statement via email: “We disagree with allegations in the City’s complaint and will vigorously defend our company, employees, and reputation. Since beginning our operations in Cincinnati 15 years ago, VineBrook has worked diligently and directly with the city to address business issues and provide safe and affordable housing. We view this latest development as an opportunity to refocus our efforts and we remain committed to providing safe, functional, and affordable single-family rental homes to residents to help set them on a pathway to homeownership and a better financial future.”
A study commissioned by the company last month says VineBrook rents are lower than the Cincinnati market average, and that Vinebrook spent $28.7 million in rehabilitation, repairs, and property taxes on its properties over the last 12 years.
VineBrook also has properties in Columbus and Dayton. Last month U.S. Senator Sherrod Brown (D-Ohio) said his office is looking into legislative fixes to address large private equity firms neglecting property maintenance. Brown specifically called out VineBrook.
Last August, the CEO of The Port of Greater Cincinnati testified before the U.S. Senate Committee on Banking, Housing, and Urban Affairs. Laura Brunner talked about the negative impact of institutional investors, specifically citing VineBrook.
Last week, Cincinnati also sued the New Jersey-based investment group that owns the 976-unit Williamsburg Apartment complex in Hartwell. The suit came after residents there went without heat and suffered flooding from burst pipes over Christmas. An earlier event around Thanksgiving involving a water main break also left some residents of the complex without water.
Summary of complaints
The city’s complaint is 65 pages long and outlines dozens of complaints. The full complaint is available below; here are some of the key claims:
VineBrook LLC’s hold between one and two hundred properties at a time and regularly transfer properties among themselves, making it difficult for local regulators and code enforcement officials to track. The complaint says this effect is purposeful: “Defendant Vinebrook transfers properties among the Vinebrook LLCs and incorporates new LLCs at least in part as an attempt to evade compliance with the City’s building, health, and safety codes.
VineBrook targets particular neighborhoods to acquire property, resulting in high concentrations of VineBrook homes. For example, the company owns 271 single-family homes in West Price Hill, nearly six percent of rental housing stock in the neighborhood. On several streets in West Price Hill, VineBrook ownership rate is as high as 20%.
The city says VineBrook routinely fails to renovate, repair, and maintain its properties in compliance with standards, and says this failure is intentional: “Defendant Vinebrook’s business model relies on keeping renovation and maintenance costs low, and Vinebrook chooses to flout the City’s building, health, and safety standards to artificially minimize its renovation and maintenance costs.”
The complaint says VineBrook systemically:
- Renovates properties without required permits
- Declines to perform necessary property maintenance and repairs in occupied units
- Deters tenants from reporting housing and building code violations to VineBrook and the City
- Leverages its substantial market power in Cincinnati neighborhoods to extract rent for buildings that are non-compliant with local health, safety, and building code standards
City attorneys reviewed 11 VineBrook leases from the last five years and the lawsuit claims all of them include terms regarding property maintenance that violate state and local laws, including:
- That any “small cost repair” is the responsibility of the tenant
- That VineBrook is not responsible for providing alternative housing if the property is rendered uninhabitable “regardless of reason”
- That tenants are responsible for all pest control except termite control
- That if a tenant requests a service call and VineBrook determines the call was unnecessary or the problem was created by abuse or neglect, the company will charge the tenant a $75 fee
The complaint says VineBrook leverages the threat of eviction and tenant blacklisting (inability to rent other housing because of a prior eviction) to impose heightened fees and discourage tenants from reporting condition problems.
The city says VineBrook routinely threatens “self-help” evictions, where the company claims they can take possession of the rental property without permission of the tenant and without going through the required legal process; this is illegal under Ohio law. Notices include threats to disconnect utilities, which is also illegal under state and local law.
VineBrook has accepted rental assistance for its tenants to avoid late-payment evictions. According to the company-sponsored report released last month, VineBrook has facilitated $3.57 million in rental assistance to 796 families. The city’s lawsuit says VineBrook routinely demands that tenants pay an “illegal $350 attorney fee charge” as a condition of accepting emergency rental assistance.
“Defendant Vinebrook’s tenants rightfully fear illegal fees, landlord retaliation, and wrongful eviction,” the complaint says. “Tenants who fear retaliatory action and wrongful eviction are less likely to report housing conditions problems to the City, again resulting in the accelerated deterioration of housing stock and an increased risk that a unit will become vacant and uninhabitable.”
Full complaint:
Cincinnati vs. VineBrook Complaint by WVXU News on Scribd
