The Board of Supes refused today to allow the owners of a building where seniors were evicted to win a lucrative permit to convert their units to condominiums.
The unanimous decision to deny the condo permit came despite the current owners of the building saying that they didn’t do the eviction.
The supes had numerous grounds to deny the permit, including what Sup. Aaron Peskin called a “growing list of omissions that misrepresent” the project.
But the message that the vote sent is clear – and critical: If you buy a building that was cleared by Ellis Act evictions, you can’t turn it into condos later.
As Mitchell Omerberg, a longtime tenant activist, told the board, city policy for decades has had consistently premise: “When the Planning Commission has determined that evictions have happened to clear the building, a conversion permit shall be denied.”
The building at 424 Francisco street had six tenants in 2004 when a speculator bought it and filed Ellis Act eviction notices. That law allows a landlord to “go out of business” be evicting all tenants.
After a long legal fight, the tenants were forced out in 2007. The speculator then flipped the building to another owner, who did some renovations, and in 2012 sold it to the current owners as “tenancies in common.”
TICs let an unrelated group of people purchase a building together and then give each part-owner exclusive rights to occupy one unit. It’s a backdoor way around the condo-conversion law, which strictly limits the number of rental apartments that can be turned into condos.
Once people buy TICs, they often apply for a condo-conversion permit, because it’s easier to refinance condos – and those individual-ownership units are worth a lot more money than shares in a TIC.
And while Scott Emblidge, attorney for the current building owners, said they didn’t have anything to do with the eviction, Omerberg said that if they had made any effort at all to research the place – including just a Google search – they would have found that seniors had been evicted under the Ellis Act and the place might not ever be eligible for condo conversions.
The evictions were widely covered in local news media.
The place was obviously cleared by a speculator with the intent of flipping the building and creating condos – which is illegal, Omerberg said.
“The law doesn’t say that if someone else did the dirty work, then it’s okay,” he explained.
The owners talked about how much they loved the city and how they wanted to stay here, but Peskin noted that they already own their homes – albeit through a less-lucrative arrangement – and that nobody will have to leave if they don’t get a conversion permit.
The message to speculators who use the Ellis Act – and to TIC purchasers who hope to get a condo permit one day – is clear: If you evict your tenants to clear the building and flip it, the city’s not going to give you any additional benefits.
That could have the positive impact of lowering the value of these properties, which could reduce the incentives to do these evictions.
The intriguing politics of this: The owners might already have their condo permits if Mayor London Breed had filled a vacancy on the Planning Commission in time. All three commissioners who were appointed by the mayor voted in favor of the conversion.
All three members appointed by the supervisors voted against it.
The seventh seat – a mayoral appointment – was vacant when this issue came up. And without four votes, the permit couldn’t be approved.
The episode shows a sharp disconnect between the policies of Mayor Breed (and we all know that she, like most mayors, lets her commissioners know how she wants them to vote on key issues) and the supes when it comes to rewarding speculators and evictors.
The board also, in two unanimous votes, moved to keep the city’s 2,200 Shelter-in-Place hotel rooms open and to urge the city to buy as many hotels as possible for long-term affordable housing.
That came just hours after the publication of an article in the Journal of the American Medical Association that says the hotel program played a key role in slowing spread of the virus and preserving hospital capacity for the sickest people. Sup. Matt Haney mentioned that article and its conclusions during the board meeting, noting that the SIP hotels have been a great success.
Mayor Breed seems to agree. In a press release today, she states:
“San Francisco’s ambitious hotel program really led the way in California by helping thousands of vulnerable residents shelter in place, isolate and quarantine to protect themselves and their community from the spread of the virus. This study has shown how effective the I/Q hotel program has been in keeping the pressure off our hospitals, which helped our frontline medical staff focus on those who were truly sick and in need of care. I’m proud of all the City staff and non-profit workers who worked quickly to get these hotels up and staffed quickly in the early weeks of this pandemic.”
In the early weeks of this pandemic, she was not a fan of quickly leasing hotel rooms.
But it turns out the program has worked – and if the mayor will support the idea, many of these hotels could become permanently affordable housing.
