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Many of the investors say poor market conditions, such as the area's crime and poverty rates, worked against them.

Let's see, you get special $$ to help redevelop a known depressed area, and then blame the poor conditions for failure?

In fact, St. John has reduced the housing stock in Overtown by demolishing slum buildings without replacing them. For example, the CDC in the last three years demolished a dozen Overtown buildings that were donated to it because it found them to be in slum conditions. The CDC plans to replace those buildings. It's not alone. The city and other investors have also added to the housing shortage by demolishing derelict buildings instead of rebuilding. The 150 buildings demolished in Overtown in the past decade, either by the city or by investors, sit on prime real estate at the edge of downtown Miami.

Looks to me like they want to sit on the properties til the growth of the downtown area ups the property values. They'd rather wait and develop office parks with multiple lucrative leases than build housing for the poor.

''They waste more money probably on letterhead and stamps than what it would cost to make this area turn around: consultants here, consultants there, consultants everywhere,'' said Eugene Rodriguez, owner of the Ice Palace and Big Time Productions Film studios, as well as several other properties in the Omni area.

That was a no-brainer.
That's why incentives to build or rewards for completed projects are better than just giving the money away.

This reminds me of the Sopranos episode where they screw HUD(?) by defaulting on loans for minority housing.