Around the Jewish World Urban Renewal: European Jews Look to Revitalize Returned Properties

A dilapidated building that once formed part of Warsaw’s Jewish hospital. A tree-shaded playground next to a former Jewish orphanage. A prewar Jewish community center, used for decades as a chemistry lab in the central Polish city of Lodz. A derelict villa in downtown Bucharest. Dozens of abandoned synagogues and Jewish cemeteries. For more than a decade, Jewish communities in Eastern and Central Europe have fought hard to win restitution of Jewish communal property that was seized by the Nazis and then by postwar Communist regimes.

Most post-Communist states have implemented some sort of legislation governing the return of such property.

Though the battle for restitution is far from over, the headaches of fighting to win back property increasingly are compounded by the headaches of what to do with it once it’s returned.

“Property management is not a continuation of the reclamation process, it’s a different skill,” said Jerry Spitzer, a board member of the American Jewish Joint Distribution Committee. “The moment you get a property back, it’s a liability. The question is how to take that liability and turn it into an asset.”

Many, if not most, restituted properties are rundown. Some have tenants paying minuscule rents. Others are open plots of land that can be developed only with high-end investment. Some, particularly synagogues, are on monument preservation lists that impose limits on how they can be altered.

“Real-estate operators would never want the portfolio that we have,” said Spitzer, who chairs the JDC’s property reclamation committee and co-chaired a JDC board mission last month to Poland, Bulgaria and Romania. One of the mission’s aims was to tour properties and assess potential.

“We have apartments, raw land, synagogues, cemeteries,” Spitzer said. “If we took all the cemeteries and synagogues that have been returned and just tried to maintain them, all the income from all the properties couldn’t do it.”

Finding money to renovate and develop, or even just to pay property taxes, is a major challenge. So is making strategy decisions: Does it make more sense to sell off property for a quick cash infusion, to renovate, or tear down and rebuild?

Other questions concern who will benefit from the income. In Poland, for example, the official Jewish community, which is Orthodox, is the only legal beneficiary of restituted communal property, yet it’s just one of a number of sometimes fractious Jewish organizations in the country.

Jewish population is notoriously hard to estimate in Poland. In Warsaw, the Orthodox community has about 500 members, whereas some 2,000 people with some sort of connection to Jewish life are believed to live in the area.

Discrepancies like this have led to criticism that property income is not benefitting the broader Jewish population. Critics also have questioned the management policy for restituted synagogues and other heritage sites.

Spitzer said that restitution entailed responsibility to all Jews.

“I believe that we’re in a historical moment in Jewish history in this area,” he said. “The properties are being returned to the remnant Jewish population; they are the guardians, the trustees of our Jewish history. We’ll be judged by what we do with them. Squandering them would be taking property that is an asset and not using it to help Jewish community life.”

To help Jewish communities hone their skills, JDC has run a half-dozen property management seminars in several countries and recently appointed a region-wide property management coordinator, based in Budapest. Jewish communities in several countries have hired their own property managers.

JDC also set up a Strategic European Loan Fund to provide interest-free loans to Jewish communities to enable them to develop restituted property and channel funds back into the community. To date, JDC has approved a dozen SELF loans, totaling more than $700,000.

One $40,000 loan, to be repaid in 2009, enabled renovation of the heating system of a century-old brick building in Warsaw that before World War II had housed a Jewish school and other community institutions, including a mikvah. The building was restituted after a four-year legal battle, but remains encumbered with three apartments occupied by sitting tenants.

Thanks to the new heating system, Jewish community property manager Piotr Rytka-Zandberg said, the community was able to rent the main part of the building to a private school, which will renovate the facility.

“The agreement with the school may not be the best financial solution, but the school is a good and solid partner and is also willing to provide six full scholarships a year for students from the Jewish community,” he said.

In Sofia, Bulgaria, the community used a $128,000 SELF loan, to be repaid by May 2011, to help turn a former Jewish orphanage located across from the city’s grand domed synagogue into a site that will be shared by a new Jewish community center, income-earning shops and office rental space.

The community hosted the JDC mission at a party last month to dedicate the new JCC, which still had not been furnished.

“We have finished the easiest job, building the walls of this building,” said Emil Kalo, president of Sofia’s Jewish community. “Before us is something more difficult: implicating the Jewish soul in these walls.”