With no money, she's a mogul

TAMPA — Jill Jackson is not your average real estate investor.

A 30-year-old single parent, Jackson takes home about $24,000 a year from her job at a credit services company. She rents an apartment in St. Petersburg and, until this year, her assets totaled about $8,000 and her financial statement showed a negative net worth.

She had zero experience in real estate acquisition — until Feb. 28. That day she bought three Tampa homes for $560,000. In the next few weeks, she bought seven more properties. She used 10 different mortgage lenders and managed to borrow 100 percent of the cash she needed for every deal.

The grand total for this greenhorn investor: 10 weeks, 10 purchases totaling $1.84-million, not a single penny down.

Jackson won’t say much about her sudden foray into real estate. She won’t discuss why she paid a huge premium for a handful of lower-value homes in Tampa or reveal how her financial statement and meager income qualified her for almost $2-million in mortgage loans.

"It’s a business I started with the help of others,’’ she said. "The mortgage payments are being made. I can’t talk any more right now.’’

Jackson won’t divulge who her partners are. But the St. Petersburg Times found connections with William Ondra Joel II, a Tampa real estate investor who has been arrested seven times on drug charges. He served four months of a one-year sentence in a Georgia boot camp in 2002 for possession of cocaine. He has purchased properties in Polk, Pasco and Hillsborough counties since being released.

Joel is a protege of Kenny Rushing, 32, who promotes himself on Tampa TV commercials, billboards and bus benches as Captain Save-a-House and pitches a message of empowerment through real estate flipping. After serving seven years in federal prison for cocaine dealing, Rushing has seen his companies rack up dozens of property sales, a success advertised in his House Hustling magazine.

Six years ago, Joel earned $8 an hour at a north Tampa mental health center. Now 26, he operates Investors Outlet. He is featured in a full-page ad in House Hustling wearing a tailored suit under the banner, "Learn How to Make $10,000 in 30 Days Without Using Your Own Money.’’

Joel’s real estate learning curve is described on Rushing’s Rehabber’s Superstore Web site ("Ondra is one of my Platinum Clients. He is a cash buyer and closes quickly. … Each deal moves him further along his success path.’’) Joel has participated in several transactions with Rushing — including one in which Rushing held the deed for a run-down home near Ybor City for just one month before selling it to Jill Jackson for a markup of $102,000.

Joel says he is a law-abiding, taxpaying businessman who supports his family and his church, the Revealing Truth Ministries Church on N Armenia Avenue, where he met Jackson.

"I live a great life,’’ said Joel. "Fifteen percent of everything I make goes to my church. We stand for integrity.’’

But officials who studied Jackson’s purchases are scratching their heads over a strange business model. Some of her properties are in disrepair. Others are in poor locations. Most are vacant.

She paid 60 percent more for the properties than the property appraiser says they are worth — a premium of almost $700,000 paid for the portfolio.

"One or two of the 10 were bought at close to market value," said Warren Weathers, Hillsborough’s chief deputy property appraiser. "But the rest of the purchases are far enough out of the realm compared to our values that you wonder if the sales are bogus."

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Queried about Jackson’s 10- ­property portfolio, Joel initially told a Times reporter that he must be mistaken.

"I think that number might be exaggerated,’’ he said. "There are a lot of Jill Jacksons in public records."

Later, Joel professed to have
nothing more than an advisory role in the purchases. "What my company is, is a management consultant,’’ he said. "I give Jill consultation."

That’s not what some sellers of the 10 properties said.

Two years ago, Bello Properties paid $40,000 for the two-bedroom, two-bath home at 3120 N Woodrow Ave. in Tampa Heights. After extensive renovations, Bello got a contract to sell it for $140,000 in March.

The buyer, according to Bello president Tony Muniz, was Investors Outlet. The signature on the contract was Joel’s.

At closing, however, the property was conveyed to Jill Jackson for $205,000, a markup of $65,000.

"There were some closing costs in there,’’ said Muniz, "But I can tell you the buyer did not get all the extra money. It went to Investors Outlet."

The home is across the street from an electric substation guarded by a chain-link fence topped with barbed wire, so Muniz was surprised at the final price ­— and loan amount — of $205,000.

"It doesn’t have a great location,’’ he said. "It’s hard to see how the investor got 100 percent financing here. Usually, you’d have to live in it to get that.

"It’s kind of scary.’’

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Carolyn Martin was delighted at the price her two-bedroom, one-bath ranch house fetched in April: $190,000, four times what she paid 15 years earlier.

The house, just 981 square feet, is a few blocks south of Gandy Boulevard. A small pool was added last year.

Martin, a 57-year-old Tampa Tribune press worker, said the $190,000 price was settled on after some haggling with her buyer: William Joel. Later, Martin found out the home had actually been sold to Jackson for $230,000.

Martin said the details were handled by Joel. She never laid eyes on Jackson.

"I never met her," Martin said. "A lady brought the papers to my house to do the closing."

Might the $40,000 difference between what Martin got and what Jackson paid have been cash earmarked for improvements? Martin doesn’t think so.

"From what I understand, he (Joel) didn’t do anything to the house," she said. "I’ve looked at it recently and nothing’s been done."

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Sonia Medina Arroyo, 68, was puzzled when asked about the $205,000 sale of her home to Jill Jackson.

That’s not what was paid, Mrs. Arroyo corrected, and that’s not who bought it.

The real buyer, she explained, had left a silver and black business card. It reads: "Inve$tors Outlet, Ondra Joel — President." It lists a business address at the Hidden River corporate complex.

"Mail and bills keep coming here for Jill Jackson," Mrs. Arroyo said. "I just send it back."

Mrs. Arroyo and her son, Rudy Medina, explained that the two-bedroom home with the bougainvillea archway in front at 510 W Plaza Place was sold to Investors Outlet for $135,000.

That’s not what the deed says. It shows the owner is Jill Jackson. The price: $205,000. Recorded next to the deed is a mortgage Jackson signed, also for $205,000. The sole witness to the mortgage: Joel.

Joel said the business card was his, but that Investors Outlet has no Hidden River office.

"I’m working from home right now," he said.

Of Mrs. Arroyo’s description of the sale, Joel said, "I think there is a misunderstanding. We’re a legitimate taxpaying company. We’ve done nothing wrong."

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The duplex at 8525 N Semmes St. that Jill Jackson bought from a land trust is in a tough part of Sulphur Springs. Unit A of the duplex is vacant, has holes in interior walls, a broken window and a green police poster plastered on the front warning against trespassing.

In Unit B lives Mariu Cruzado, 69, whose income qualifies her for a federal $580-a-month rent subsidy under the Section 8 program administered by the Tampa Housing Authority.

Cruzado said she was moved into the duplex by "Maurice" and told, "You don’t have to pay rent. You’re Section 8." Maurice is Maurice Vernon, a vice president of Investors Outlet, according to the silver and black business card Cruzado saved.

Joel said Vernon was never a vice president of his company and has since left Investors Outlet.

Joel did acknowledge being the trustee of the land trust that bought the duplex last August for $100,000, then sold it to Jackson in April for $138,000. The names of the beneficiaries of the land trust who owned the duplex are confidential, and Joel refused to identify them.

He did say a strong selling point for the property was its Section 8 tenant, Cruzado. Joel also said subsidy payments had continued to flow to the trust when it owned the duplex.

That’s not what Tampa Housing Authority records show. No Section 8 payments were made on behalf of Cruzado after Joel’s trust bought the property, even though she is qualified to receive the $580-a-month subsidy until 2007.

When the property was conveyed to the trust, housing officials asked the new owner to come in and make application for the funds, said Clarence Brown, director of assisted housing for the Tampa Housing Authority. But no one came in.

Nor has anyone come in to apply for the funds since Jackson bought the duplex.

"We don’t know why," said Brown. "But the U.S. government wants to know who it’s paying."

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The city of Tampa classifies the clapboard home with the big white columns at 2920 N 17 St. as "dilapidated."

Rushing, aka Captain Save-a-House, bought the three-bedroom, two-bath home from Melvin and Sonia Lake-Gunn for $93,100 in February. Melvin Gunn said he had an offer for twice that but "felt comfortable with Kenny" and took the lower price.

A month later, Rushing sold to Jill Jackson for $195,000.

In an initial interview, Rushing said he did not recall Jackson. Later, he was able to provide details about her role — and Joel’s — in the sale.

In an unorthodox arrangement, Rushing said he allowed Joel to make thousands of dollars in renovations to the house before selling it to Jackson. Rushing said that allowed the house to be appraised higher so that Jackson could obtain a $195,000 loan, the amount of the purchase price.

"Ondra Joel, he structured the deal," Rushing said. "Ondra Joel rehabbed the house. It wasn’t sold at the condition I bought it. It was rehabbed."

It’s not clear what work was done. The city of Tampa says no permits have been obtained to make any improvements to the house with the white columns since 1998.

The story is similar with the other nine properties. While Jackson began buying less than four months ago, it has been 18 months since a permit for renovation was pulled on any of them.

Joel said he saw nothing unusual about Jackson’s property acquisitions, and he said he operates his business honestly.

"There’s nothing spectacular about this," Joel said. "It’s not like Jill is a real estate guru or something.

"I have not lied to anybody or cheated anybody. There’s no appraisals that’s been inflated," he added. "I’m not this greedy guy you’re making it out to be."