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Soulless Converts 

L.A. tries to deal with the rush on condos

Wednesday, Aug 16 2006
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TENANTS-RIGHTS ADVOCATE LARRY GROSS had just gotten off the telephone with an Orange County bureaucrat who wanted to know how Los Angeles was coping with the conversion of thousands of rent-controlled apartments to pricey condominiums — a process that has been forcing out renters across the city.

Lake Forest, a suburb in south Orange County, put a moratorium on condo conversions two years ago. Simi Valley, a bedroom community in Ventura County, crafted a plan last month to prohibit condo conversions if the vacancy rate for apartments falls below 5 percent. Now, the bureaucrat was trying to determine whether Orange County’s unincorporated neighborhoods should receive a temporary ban as well.

Gross, who heads the Coalition for Economic Survival, fielded the call as he was reviewing the new package of tenant-protection proposals unveiled Tuesday by Councilman Herb Wesson. Designed to deal with a spike in evictions from rent-controlled apartments, they called for increased relocation benefits and higher fees for condo developers. What it lacked, however, was a moratorium, Gross groused.

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“They’re going to watch Rome burn with these amendments,” he declared. “Who would have thought that Orange County would be far more progressive on these issues than the city of Los Angeles?”

Housing advocates had been waiting for months for Wesson’s legislative package on condo evictions, which is slated to go before the full council Friday. Wesson and his colleagues on the Housing, Community and Economic Development Committee traveled across the city last spring, taking testimony from hundreds of renters and advocacy groups dismayed by the number of apartments being transformed into for-sale lofts and condominiums, either through conversion or outright demolition.

City officials estimate that more than 11,000 rent-controlled apartments have disappeared over the past five years, replaced by developers seeking to move rental units into the for-sale market. And two council members — Bill Rosendahl and Alex Padilla — have responded by proposing a temporary ban on condo conversions for their council districts, which cover coastal neighborhoods and the northeast San Fernando Valley, respectively.

Wesson’s plan is a bit different. One provision would allow seniors 62 and older, as well as the disabled, to stay in a converted apartment for up to two years after it has been pulled from the rental market. Another would allow tenants to receive $1,000 worth of moving expenses if their apartment is demolished and converted. A third would hike the fees charged to developers who replace apartments with for-sale units, tripling the amount to $1,500 per unit for buildings that have more than 10 apartments. “We were surprised,” said Aníbal Valdez-Ortega, an organizer with Inquilinos Unidos. “We wanted a citywide moratorium. We thought he’d do a bit more.”

While tenant advocates voiced dismay, the landlord lobby offered guarded praise for the housing initiatives on Wednesday, telling Wesson’s committee that they are reasonable alternatives to the temporary ban. The Central City Association, which represents developers across the city also, said Wesson had devised something they could live with — unlike a moratorium.

“[A moratorium] sends absolutely the wrong message at absolutely the wrong time, because the condo market is slowing down significantly,” said Carol Schatz, who heads the Central City Association. “And while there may be some projects still in the pipeline, there aren’t that many. It scares investors anytime you talk about a moratorium, and let’s not forget that housing drives the L.A. economy.”

Wesson, for his part, said he sought to avoid a knee-jerk reaction to the housing crisis. While he called the support from the business community a “pleasant surprise,” Wesson said he expected some criticism. “I would love to have a day where everybody agreed and thought it was the best thing since sliced bread, but in this business those days rarely come,” he said.

EVEN IF WESSON’S PROPOSALS are embraced by the council on Friday, most of the initiatives will likely take months to approve. The proposed ordinance increasing developer fees likely won’t reach the council until November, or within 90 days. A plan for encouraging the construction of new apartments won’t likely appear until December, or within 120 days.

The only protections that will go into effect immediately are ones designed to carry out provisions of the state Ellis Act, which allows landlords to go out of the rental business. One measure would prevent landlords from converting condo units on a piecemeal basis, either apartment by apartment or floor by floor. The other would keep landlords from dropping their plans for condos once they had used state law to evict all their tenants.

The only thing is, the council requested those measures in December 2003 — telling City Attorney Rocky Delgadillo at the time that they wanted a report back on enforcement provisions within 60 days.

Schatz said she and her allies are now pressing Rosendahl to drop his proposed moratorium — frequently referred to as an interim control ordinance, or ICO — for such neighborhoods as Venice, Brentwood, Westchester and Pacific Palisades. Meanwhile, Gross plans to pressure the city from the other direction, arguing that the only way to provide tenants some relief is to pursue a citywide time-out, then craft a new package of regulations.

“[Wesson’s package] is all noncontroversial,” he said. “They’ll do their studies. They’ll miss their deadlines. And while providing some benefits to the city, none of them truly get to the heart of the problem, which is that the condo conversions and demolitions must be limited. Limiting the loss of affordable housing must be the centerpiece of their actions. Otherwise they’re not coming to grips with this crisis.”

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