DETROIT (WXYZ) — Detroit residents and city officials say they're fed up with faceless landlords.
On Wednesday, the city of Detroit took aim at a Florida-based crypto real estate company by filing a massive lawsuit accusing the company of neglecting over 400 of their properties.
Watch Mike Duffy's video report below:
The city says numerous issues of neglect have forced Detroiters to live in unacceptable conditions.
I had the chance to listen Wednesday as they explained how the crypto real estate company, Real Token, operated and why it ends now.
“Real Token has been quickly acquiring, or quietly acquiring, hundreds of residential properties right here in our city and selling fractional ownership through cryptocurrency to investors around the world," Detroit City Councilwoman Angela Calloway said.
Calloway says behind the high-tech language lies a familiar problem in Detroit: neglected properties.
“The landlords are pretty much faceless, the investors sometimes are overseas and the damage is very real,” Calloway said.
The city is suing Real Token and provided numerous depictions of the most egregious cases.
“This company, Real Token, is an outlier, is a provider of substandard housing and tries desperately to escape justice by hiding behind 165 corporate entities,” said Conrad Mallett, corporation counsel for the city of Detroit.
“Even casual observers have to wonder how in most of those cases, one human being could so systematically inflict such harm on another.”
The lawsuit asks Real Token to pay the $500,000 in tickets it has already racked up, to obtain a certificate of compliance for each of its properties and to have the courts oversee the process, among other demands.
Some of the details we heard is that ceilings are falling in and there are plumbing issues. One woman said she hasn’t had a working shower in two years.
Andre Walker lives near one of the neglected properties in the Brightmoor neighborhood.
“That is really bad because you can just see some of the houses that do need help,” Walker said.
He said he’s not surprised that the company could own properties and not be taking care of them.
I also went traveled further south to another blighted property the city says is owned by Real Token on Abington Avenue. I met up with neighbor Pamela Myles, who told me it has been vacant since last fall.
“Hey, it’s real hard out here. You got to beat the scammers. And to me, with the crypto company that’s buying all these properties — and they own so many properties — they seem like they’re scamming as well,” Myles said.
“I feel like they’re renting to people and the residents don’t know who to get in contact with. It’s not fair to them. They don’t know who to pay their rent to. And it’s not fair to the residents. If they’re not going to come and fix anything up, then we have abandoned buildings.”
Real Token released a statement:
Since RealToken has entered the Detroit market, we have been committed to the goal of providing safe, affordable housing for our tenants, and playing a supporting role in revitalizing Detroit's neighborhoods. Unfortunately, we have been one of many victims in Detroit of several unscrupulous property management companies. These companies were paid hundreds of thousands of dollars to oversee RealToken’s properties, address tenant complaints and make repairs, and maintain each of our properties in accordance with City of Detroit municipal codes. As it turns out, there are many instances where these goals were not achieved, and each management company, in its own way, stole these funds to the detriment of RealToken and more importantly, the tenants we serve.
We know that nobody is going to feel sorry for RealToken and we have taken full responsibility for our mistakes: that is why since December 1st 2024, we have invested in our property management company to directly manage our properties, and instituted comprehensive checks and balances to ensure something like this never happens again. We took over all the properties at once and started addressing blight violations, administrative filings, servicing maintenance calls and conducting full rehabs. We have made complete repairs to over several dozens of properties, addressed hundreds of blight tickets, and have contractor teams in the field every day addressing each disgruntled tenant and city citation in turn. This process cannot happen overnight. It takes time. But we are committed to addressing every issue, and finally execute on our original mission.
That being said, we have not been served with a lawsuit, and reserve all further comment until after our lawyers have had a chance to review the allegations and present our response at the appropriate time in Wayne County Circuit Court.
