Last November, the DHA had paid Casden Properties Inc. of Beverly Hills, CA $12.3 million for the 199-unit project on 14 acres that houses some of the poorest people in Denver. The DHA had been in the process of condemning the project when it reached an 11th hour agreement to buy it.

The DHA initially had planned to rehab the units until it could bring on a private developer to form a public-private development that would incorporate the existing, low-income projects with market-rate units. The site, across the street from Atlanta-based Post Properties' ongoing $100-million luxury apartment complex, is seen as ultimately being quite valuable. Indeed, at one point Post had hoped to buy the project and work with DHA, but the developer had received no support from Mayor Wellington Webb.

After touring the units, DHA had decided rehab costs would hit $5 million instead of the original $1.3-million projection. The DHA already has spent $75,00 replacing eight furnaces, installing fire extinguishers, fixing toilets that didn't flush, and replacing door knobs so residents could lock doors. Quite simply, the DHA had decided that it didn't want to throw good money after bad. The agency still has not chosen a private developer to work with, but is in the process of seeking input on what should be done.