ReportWire

Tag: Landlord

  • In face of extreme heat, L.A. may require landlords to keep their rentals cool

    Los Angeles landlords may soon be required to keep rental units cool — or at least make it possible for tenants to do so.

    County supervisors last month passed a law requiring landlords in unincorporated areas to provide a way to keep their rental units at 82 degrees or below. A measure introduced Wednesday in the Los Angeles City Council directs officials to draft language conforming to the same standards.

    That comes as climate change ratchets up the frequency and intensity of heat waves. Extreme heat already kills more people in the United States each year than any other weather-related event, according to the National Weather Service.

    Sustained indoor heat above 82 degrees has been linked to increased emergency-room visits, hospitalizations and deaths, according to a news release from Councilmembers Bob Blumenfield and Eunisses Hernandez, who introduced the measure along with Councilmember Adrin Nazarian.

    “It’s a health issue, first and foremost,” said Nazarian, who pointed out that the effects of extreme heat fall disproportionately on vulnerable populations like those who are chronically ill. Older residents are much more susceptible to dying from heat or related complications, he said. And poorer people are more likely to live in aging buildings without duct systems or air conditioning units. “It’s critical for us to take steps so that we’re protecting our residents.”

    The California Department of Housing and Community Development earlier this year urged lawmakers to adopt the 82-degree maximum temperature threshold statewide. State law already requires rental units to include equipment that can heat the unit to at least 70 degrees.

    “Why should cooling be any different?” asked Blumenfield, who represents the hottest part of the city — his 3rd District covers much of the southwestern San Fernando Valley. Last year Woodland Hills, where Blumenfield also lives, hit 121 degrees — the highest temperature ever recorded in Los Angeles. “We always have heat strokes go up and all sorts of health related issues happen when it gets really hot,” he said.

    The intention of the proposed measure is to hew as closely to the county regulations as possible, including provisions that provide flexibility to small landlords, Blumenfield said. For instance, the county rules allow landlords who own 10 or fewer units to meet the temperature requirement for just one room until 2032. And while the law took effect this month, it won’t be enforced until 2027.

    The measure will take some time to draft and be heard by various committees but could come up for a vote before the full council in a matter of months, Blumenfield said.

    If it passes, Los Angeles would join a growing list of cities that have adopted maximum temperature thresholds for rentals. In Phoenix, units with air conditioning must be able to maintain a temperature of 82 degrees or below. In Clark County, Nev., units must be able to stay at 85 degrees or cooler. In Palm Springs, units need to have air conditioning and be able to maintain 80 degrees. Dallas requires landlords to keep buildings at least 15 degrees cooler than the outside temperature but no higher than 85 degrees, and New Orleans requires units to be able to maintain a maximum temperature of 80 degrees in all bedrooms.

    The Apartment Assn. of Greater Los Angeles was adamantly opposed to the measure, saying it would drive up the cost of housing and ultimately lead to higher rents.

    It’s difficult to maintain a unit at 82 degrees without using an air conditioner, which can be costly to both landlords — who may need to upgrade buildings’ electrical service — and tenants, who must pay for utility bills, according to Daniel Yukelson, the group’s chief executive and executive director.

    “Any cooling device will be ineffective if too expensive to operate because renters cannot afford the electricity,” he wrote in an email. “It’s like prescribing medication with a co-pay that is too high for a patient to refill.”

    Yukelson also questioned whether the electrical grid can accommodate the additional load, saying that customers are already subjected to blackouts and brownouts during the summer.

    Nazarian and Blumenfield both pointed out that the law does not require air conditioning, and said units could be kept cool with other interventions, including cool roof technology and window tinting. The Los Angeles Department of Water and Power also offers rebates to help certain customers purchase air conditioners, Nazarian said.

    Grace Hut, assistant director of policy and advocacy for tenants’ rights group Strategic Actions for a Just Economy, said her organization has spoken with many renters whose landlords have actively prohibited them from installing air conditioner units. While she understands concerns about utility prices, tenants ultimately want to be able to choose for themselves whether or not to turn on an air conditioner and shoulder the higher electricity costs, she said.

    “On extreme heat days, access to air conditioning can be a matter of life and death, and they should have the option to use it,” she said.

    The city should also dedicate resources to enforcing the temperature-threshold rules and to helping tenants afford their utility bills to lessen the burden, she added.

    “Climate change is only going to continue to exacerbate this issue so it’s really important that we take action immediately,” she said.

    Last year was the warmest on record globally, and temperatures are projected to continue to rise. In 2022, a Times investigation revealed that heat probably caused about 3,900 deaths in California over the previous decade — six times the state’s official tally — and that the undercounting has contributed to a lack of urgency in confronting the crisis.

    Times staff writer Rebecca Ellis contributed to this report

    Alex Wigglesworth

    Source link

  • How landlords can enhance interiors and gardens to attract family tenants – Growing Family

    Collaborative post

    Hunting for the right rental home in the UK can be challenging because there are numerous priorities to consider before making a choice. Families specifically look for their temporary rental homes to resemble their dream homes as closely as possible, aiming for a more stable and long-term tenure.

    While nothing can be done with property sizes and locations, landlords can easily enhance interiors and gardens to attract family tenants. Doing so not only increases the home’s appeal but also creates a safe space for tenants. It can even lead to longer leases and strengthen the landlord’s investment, which the landlord can further protect through landlord insurance to avoid any future issues.

    a family making breakfast in a kitchen

    Understanding the tenant’s need

    If you’re a landlord and want to attract and retain high-quality renters for long tenures, you must understand the expectations & desires that today’s tenants are looking for. This involves upgrading not only the aesthetic of the property, but also making the space multi-functional. 

    Given the latest modern rental market trends, families aren’t just looking for homes to live in. They are also seeking homes that are stylish to look at and have comfortable amenities. As a landlord, you need to think like that and plan your upgrades accordingly. 

    You can start by incorporating interiors that are both modern and classic, thereby enhancing the overall ambience of the rental. For example, you can use attractive furniture in the living room and bedrooms, and choose sophisticated paint colours for walls. To make the space more functional,  adding more storage options is also a great idea. In short, you need to blend modern aesthetics with solutions to day-to-day needs.

    If you’re investing in your rental homes through renovations, make sure that you also have landlord insurance to protect yourself from accidental damage, rent defaults, and liability claims. If you’re renting out the place to families for the long term, insurance is necessary to safeguard your investment in the property.

    Interior enhancements that make a difference

    1. Invest in functional, family-friendly furnishings

    A well-furnished house will attract families seeking a beautiful place to live. Investing in wooden furniture is a good idea because it looks elegant and lasts longer.

    While having aesthetically pleasing furniture is not mandatory, it can definitely become a plus point in attracting high-quality tenants who are looking for more than just a place to live and can afford to pay high rent.

    small kitchen with green wallsmall kitchen with green wall

    2.Upgrade kitchens and bathrooms without overspending

    You might need to upgrade the kitchen and bathroom to make your rental more modern and appealing. Using stylish wall tiles, decorative storage, and textured walls in your bathroom and kitchen are all easy ways to upgrade the look.

    Choosing colour combinations for a kitchen can be challenging, as this space is integral to a family’s daily life. Try to add pleasing colour combinations instead of bright ones. For example, go with a simple paint colour that complements the kitchen cabinets.

    Bathrooms also require the same attention because they’re a place where people want a relaxed atmosphere. You can dramatically transform a bathroom by using stylish tiles on the walls and floors. Another easy hack is to replace old taps and showers with stylish fittings. This can make the bathroom look modern and immediately grab the attention of tenants.

    3. Go for low-maintenance premium-quality flooring options

    Floor tiles can make your interiors shine, quite literally! Since it’s one of the most visible aspects of a home, it sets the tone. Invest in durable, stylish flooring if you can. 

    If you have a higher budget, you can go for either engineered hardwood or traditional hardwood. Although they will cost more, the overall look will be classy and refined.

    a person looking at a neutral colour palettea person looking at a neutral colour palette

    4. Use a neutral wall colour palette

    Using a neutral wall colour palette is a good hack because you don’t have to think about dark colour combinations, and neutral shades look timeless and classic. Some of the most popular colours are cream, off-white, and light shade colours. 

    When choosing wall paint, make sure you use a premium-quality, washable paint. This will save you from long-term expenses. You can also add subtle texture designs to make your walls look modern and appealing.

    Garden and outdoor enhancements

    gardening tools in a gardengardening tools in a garden

    Use seasonal plants in the garden

    Rental homes with gardens are a significant bonus. A well-groomed garden can make a rental property look luxurious and refreshing. Having a garden on your property means taking extra care to maintain it, ensuring it is structurally sound and visually appealing.

    Use low-maintenance plants to keep the gardening to a minimum, and try to choose plants that provide colour and interest throughout the year. You can also add container plants at the property’s entrance to make it look more appealing. 

    2. Improve outdoor lighting for safety and kerb appeal

    To make your garden look more beautiful, you can install a range of outdoor lighting. Think about adding spotlights on big plants, solar lights along the pathway, or string lights in seating areas. As well as making the garden look warm and welcoming in the evening, lighting can make the space safer and easier to use after dark.

    Families looking to rent a property aren’t are probably keen to find an affordable place to grow and build memories. By enhancing both the interiors and outdoor spaces with thoughtful, family-friendly upgrades, landlords can significantly increase their property’s appeal and attract family tenants.

    Functional furnishings, stylish kitchens, well-lit gardens, and a better rental experience can lead to higher rental yields and more satisfied tenants. Just remember, while you are adding value to your property, don’t forget to secure it with comprehensive landlord insurance. It’s the safety net that protects your efforts and your property.

    Catherine

    Source link

  • Latino tenants sued their landlord. A lawyer told them they would be ‘picked up by ICE’

    In her entire law career, Sarah McCracken has never seen anything like the email she received on June 25.

    McCracken, a tenants’ rights lawyer at Tobener Ravenscroft, is currently representing a Latino family suing a landlord and real estate agent for illegal eviction after being kicked out of their Baldwin Park home last year.

    A few weeks after being served, amid a series of ICE raids primarily targeting Latino communities in L.A. County, Rod Fehlman, the lawyer who appeared to be representing the agent at the time, sent McCracken’s team a series of emails disputing the lawsuit and urging them to drop the case.

    He ended the correspondence with this: “It is also interesting to note that your clients are likely to be picked up by ICE and deported prior to trial thanks to all the good work the Trump administration has done in regards to immigration in California.”

    “It’s racist,” McCracken said. “Not only is it unethical and probably illegal, but it’s just a really wild thing to say — especially since my clients are U.S. citizens.”

    The comment arrived as ICE raises tensions between landlords and Latino tenants. According to California Atty. Gen. Rob Bonta, ICE has been pressuring some landlords to report their tenants’ immigration status.

    Bonta’s office issued a consumer alert on Tuesday reminding landlords that “it is illegal in California to discriminate against tenants or to harass or retaliate against a tenant by disclosing their immigration status to law enforcement.”

    Fehlman didn’t respond to requests for comment, nor did the clients he seemed to be representing: real estate agent David Benavides and brokerage Majesty One Properties, Inc. Fehlman’s role in the case is unclear; following requests for comment from The Times, Benavides and the brokerage responded to McCracken’s complaint using a different law firm.

    But according to McCracken, Fehlman serves as the defendants’ personal attorney and will likely still take part in the lawsuit in an advisory role.

    Evicted

    From 2018 to 2024, Yicenia Morales rented a two-bedroom condo in Baldwin Park, which she shared with her husband, three children and grandson. According to her wrongful eviction lawsuit filed in May, the house had a slew of problems: faulty electricity, leaks in the bathroom, bad ventilation, and a broken heater, air-conditioning unit and garage door.

    “There was a lot that needed to be fixed, but we accepted it because we were just happy to find a place to live,” Morales said.

    The real problems started in 2024, when her landlord, Celia Ruiz, started asking the family to leave because she wanted to sell the property, which isn’t a valid reason for eviction under California law or Baldwin Park’s Just Cause Eviction Ordinance, the suit said.

    According to the lawsuit, Ruiz then changed her story, alleging that she wanted to move into the house herself, which would be a valid reason for eviction. According to the suit, Ruiz and her real estate agent, David Benavides of Majesty One Properties, constantly urged Morales and her family to leave.

    In September, the pressure mounted. Ruiz penned a handwritten note saying she needed the house back, and Benavides began calling them almost every day, the suit said.

    In November, assuming Ruiz needed to move back in, Morales left. But instead of moving in herself, Ruiz put the property on the market in January and sold it by March.

    “I really believed she needed the house for herself,” Morales said. “I’m just tired of people taking advantage of others.”

    Lawyer tactics

    Depending on your interpretation of California’s Business and Professions Code, Fehlman’s comment could be illegal, McCracken said. Section 6103.7 says lawyers can be suspended, disbarred or disciplined if they “report suspected immigration status or threaten to report suspected immigration status of a witness or party to a civil or administrative action.”

    In addition, the State Bar of California bans lawyers from threatening to present criminal, administrative or disciplinary charges to obtain an advantage in a civil dispute.

    You could argue that Fehlman’s email isn’t a threat. He never said he’d call ICE himself, only claiming that Morales and her family “are likely to be picked up by ICE and deported.”

    Morales and her entire family are all U.S. citizens. But she said she feels racially profiled because of her last name.

    “It’s not fair for him to take advantage of that,” she said. “I was born here. I have a birth certificate. I pay taxes.”

    Just to be safe, Morales sent her birth certificates to McCracken’s team. Even though she’s a citizen, if Fehlman reports her to ICE, she still doesn’t feel safe.

    Federal agents have arrested U.S. citizens during its recent raids across L.A, and a 2018 investigation by The Times found that ICE has arrested nearly 1,500 U.S. citizens since 2012, detaining some for years at a time.

    “I was already depressed over the eviction. Now I’m hurt, embarrassed and nervous as well. Will he really call ICE on us?” Morales said.

    McCracken said Fehlman’s message is a byproduct of the current anti-immigrant political environment. Fehlman sent the email on June 25, the end of a jarring month that saw the agency arrest 2,031 people across seven counties in Southern California, 68% of which had no criminal convictions.

    “People seem to be emboldened to flout the law because they see people at the top doing it,” she said. “It’s totally unacceptable behavior.”

    An ironic twist, she added, is that Fehlman’s own client at the time was also Latino.

    “I don’t know if Benavides was aware that his lawyer is making racially profiling comments, but I don’t think he’d want to work with someone like that,” McCracken said.

    The case is still in its early stages. Benavides and Majesty One Properties responded to the complaint on July 17, and McCracken’s team hasn’t officially served the landlord Ruiz yet because they’ve been unable to locate her.

    In the wake of the ICE comment, communication between McCracken and Fehlman halted. McCracken decided Fehlman’s rant and possible threat didn’t warrant a response, and Fehlman hasn’t said anything else in the meantime. Her team is still deciding how they want to proceed in the wake of the comment, which could justify legal action.

    She called it a dangerous attempt to chill her client’s speech and a failed attempt to intimidate her into dropping the case. But he took it way too far.

    “We’re at a point in time where lawyers need to be upholding the rule of law,” she said. “Especially in a time like this.”

    Jack Flemming

    Source link

  • Evicted from her apartment at 68, an artist starts anew in a sunny L.A. fourplex

    After living in her two-bedroom apartment in Los Feliz for more than a decade, Debra Weiss encountered a problem experienced by many renters in Los Angeles: She was evicted.

    “I moved into the apartment in 2014, and four years later, my landlord sold it to a wealthy family who bought it at a loss,” said Weiss, 69, who works as a textile artist and was evicted last year. “They knew they couldn’t evict us due to rent control.”

    In this series, we spotlight L.A. rentals with style. From perfect gallery walls to temporary decor hacks, these renters get creative, even in small spaces. And Angelenos need the inspiration: Most are renters.

    When the landlords put the three-unit complex on the market in 2022, however, they offered Weiss $50,000 to move out — far more than the amount required by law — to make the building easier for them to sell. She declined, concerned it would affect her Social Security benefits, as there is a limit to how much one can earn and still receive full benefits.

    Then, last February, the three tenants received eviction notices under the Ellis Act, which allows landlords to evict renters from rent-controlled apartments if the building is being torn down or removed from the rental market. It’s currently for sale for $3.2 million.

    As a senior, Weiss was entitled to a full year’s notice because she had lived in her unit for more than a year. Still, she knew she would eventually have to move out of the comfortable 1,200-square-foot duplex, for which she paid $2,670 a month in rent.

    Artist Debra Weiss stands in her dining room

    Artist Debra Weiss stands in her dining room where she often works as a fiber artist.

    When she began looking for another apartment in the area, Weiss quickly learned that she could no longer afford to live in Los Feliz. “The apartments were so much more expensive than what I was used to paying, and they had no parking or a washer and dryer,” she said. (Weiss was paid $24,650 in relocation assistance, which was taxed, due to her age and the length of time she lived in her Los Feliz apartment.)

    She also visited some small studios and considered purchasing a TIC, or Tenancy in Common, where buyers purchase a share in a corporation that owns a building. However, to secure a loan, she’d need someone to co-sign. “Even though they are cute, they are tiny and not necessarily in the best neighborhoods,” she said. Another option, a Craftsman apartment near USC, wasn’t in a good walking neighborhood, something that was important to Weiss. It was also dark and hundreds of dollars more a month than her previous apartment. “I’m almost 70 years old and I need light to work,” she added.

    A knitted cowl on a mannequin
    Handknitted metal sculptures hang on a wall
    A bedroom filled with colorful textiles and weavings

    Handknitted sculptures, embroidered weavings and a tufted rug adorn the guest room.

    When her son-in-law spotted a charming two-bedroom apartment near the Los Angeles County Museum of Art for $2,950 a month on Zillow, Weiss decided to check it out.

    “My initial reaction was, ‘I want this,’ ” Weiss said of the fourplex.

    The rental had high ceilings, oak floors, ample sunlight, an appealing fireplace, a garage and a washer and dryer. A newly redone modern kitchen felt out of character for the 1930s building, but that didn’t bother Weiss. “The kitchen is a blank canvas,” she said of the all-white cabinets and countertops. “The white background makes all of my stuff stand out,” including ceramics by Mt. Washington Pottery and Altadena artist Linda Hsiao.

    Artist Debra Weiss knits a sweater at her dining room table

    Weiss knits a sweater for her granddaughter with yarn she purchased in Japan.

    Concerned that the landlord wouldn’t want to rent to her because of her age, she was pleasantly surprised when she got the apartment. “The light is amazing,” Weiss said. “I was initially worried about some of the modern touches like the overhead lighting, but it floods the room with bright light that allows me to work at night.”

    Nearly a year after moving in, Weiss has filled the apartment with her stitched collages, quilts and the artworks of others, many of which she described as “trades.” “I like color and pattern and objects,” she said as she pointed out some Japanese ceramics on her buffet and a dress that she crocheted with scraps of fabric, yarn and metal.

    In the guest room, a wall hanging composed of three separate weavings in a gingham check pattern is embroidered with a series of characters she based on her 5-year-old granddaughter’s drawings. “It’s about people coming together in chaos and supporting each other,” Weiss said. “I like the pattern; it reminds me of eating together on picnic tables.”

    Ceramics, flowers and art rest on an all white mantle
    Ceramics rest on a white countertop in a kitchen
    Dried yellow flowers rest on a brown ceramic bowl
    Debra Weiss is reflected in a mirror in her bedroom

    “I like objects,” Weiss said of the many treasures and collections of things that are featured throughout her rental.

    On the opposite wall of the guest room above her sewing machine, a series of metal sculptures she knitted with copper and silver hangs alongside cloth dolls and purses. In the corner, a cowl made of macrame, textiles and yarn adorns a mannequin. There’s also a colorful latch hook rug that she made with acrylic yarn that looks more like artwork than a functional accessory.

    In her bedroom, a coverlet that Weiss assembled from vintage quilts adorns the bed.

    The long hallway ends at the laundry room and is lined with her colorful quilts, some of which are mounted on Homasote board, along with weavings and stitched works, which, like her cooking, are improvisational.

    “I work without planning and respond to the materials and see what it becomes,” she said. “I start knitting and see where it goes. I get excited about the material, and then I go for it. “

    A hallway lined with fiber art

    The hallway in Weiss’s apartment is lined with her artworks.

    Much of the wood furniture in her apartment was made by her father, who died 13 years ago.

    “I’ve had this since my kids were little, and you can see all the markings,” she said of the hutch in the corner of her dining room. “My dad made it 40 years ago for the Van Nuys house I grew up in.”

    It is here, at the dining room table that her father made, that she works, hosts workshops and teaches lessons in fiber art, collage and stitching. Later this year, she hopes to host a sale of her work at a holiday open house in her apartment.

    A dining room table and walls lined with art
    A dining room with a wood table and chairs
    A brown knitted work rests on a table

    Weiss is an expert in mixing texture, pattern and color in her Mid-Wilshire apartment.

    The mixing of colorful Persian rugs, textiles, natural materials, chunky wood pieces and intricately knitted metal sculptures creates a warm balance throughout her apartment.

    Bursting with color and pattern, the rooms offer a sense of calm that Weiss appreciates as a woman who raised three daughters alone and has had to pivot during major life changes. Over the years, she has run a clothing company, Rebe, which closed in 2019 due to economic uncertainty, declared bankruptcy and sold her Woodland Hills house. Most recently, she was forced to weather the eviction process.

    Debra Weiss looks through a cabinet full of her artwork at her apartment

    “I’ve always been an entrepreneur,” said Weiss, who works six to eight hours a day at home and sells her artwork and sewing patterns on her Specks and Keepings website and at L.A. Homefarm in Glassell Park. “I’ll always figure out a way to make money by selling the things that I make.”

    Even though the process of having to move was stressful, Weiss is happy with her new home and neighborhood. “I take the Metro bus everywhere and hardly ever drive,” she said. “I go to the Hollywood Farmer’s Market on Sundays. Kaiser is nearby and I can walk to LACMA. Everything worked out perfectly.”

    Artist Debra Weiss looks through a cabinet full of her work

    Weiss pulls out a drawer of her flat files cabinet filled with her artwork.

    Lisa Boone

    Source link

  • Price-gouging charges slowly mount after the fires, but some say it’s not enough

    California Atty. Gen. Rob Bonta accused real estate agent Iman Shaghyan this week of increasing the price of a Beverly Hills rental by more than 30% in the days after the Jan. 7 fires. It’s the fourth charge Bonta has filed since price-gouging rules went into effect that prohibit rent hikes of more than 10% after a natural disaster.

    “Profiting off Californians’ pain through price gouging is illegal and I will not stand for it,” Bonta said in a news release.

    In the weeks after the fires, city officials vowed to crack down on violators as thousands of complaints poured in, with some organizers even compiling spreadsheets documenting the skyrocketing rents. Bonta enlisted teams of lawyers to evaluate complaints, and his office has primarily targeted real estate agents.

    But some critics claim that government officials aren’t doing enough to address the rampant price gouging that appeared across the region in the wake of the fires, saying that the charges filed represent only a small fraction of the complaints submitted to the city and state.

    “More needs to be done,” said Chelsea Kirk, co-founder of the activist organization the Rent Brigade. “It’s been de-prioritized, and all discourse from elected officials and the press around rent gouging has ended.”

    Kirk’s organization checks Zillow for examples of price gouging and said there are currently more than 10,000 active listings that qualify. Her team submits weekly reports to government officials but said transparency is a problem since no one knows exactly what is being investigated.

    As a result, her team worked with L.A. City Councilmember Hugo Soto-Martínez to draft a motion that, if passed, would require L.A. City Atty. Hydee Feldstein Soto to produce monthly reports detailing the total number of price-gouging complaints received, response times and enforcement actions. The motion has been introduced but not yet placed on the agenda.

    “There’s an utter lack of urgency,” Kirk said.

    In addition to Shaghyan, Bonta filed charges in January against La Cañada Flintridge agent Mike Kobeissi and Glendale agent Lar Sevan Chouljian. In February, he charged Hermosa Beach agent Willie Baronet-Israel as well as Edward Kushins, the landlord of the property.

    All of the cases are active. If convicted, the maximum penalty for the misdemeanor is a year in prison and a fine of $10,000.

    In addition to the charges, state Department of Justice officials said they have sent out more than 750 warning letters to hotels and landlords accused of price gouging. The department also is investigating fraud, scams and low-ball offers on burned properties.

    Bonta is investigating on behalf of the state and Feldstein Soto is filing lawsuits on behalf of the city. So far, she’s been targeting more than just real estate agents.

    In February, Feldstein Soto’s office sued rental giant Blueground, citing more than 10 cases of price gouging. In one instance, Blueground allegedly jacked up the rent of a downtown L.A. apartment by 56% on Jan. 7, the day of the fires.

    In March, Feldstein Soto’s office sued a group of homeowners and companies for $62 million, citing not only price-gouging violations but also violations of the city’s short-term rental ordinance, which places restrictions on rentals such as Airbnbs. The group of defendants included four homeowners and five limited liability companies: Akiva Nourollah, Micah Hiller, Haim Amran Zrihen, Rachel Florence Saadat, Hiller Hospitality, Hiller Hospitality Group, 1070 Bedford, Red Rock and Coastal Charm.

    The Times reached out to all the individuals charged with price gouging or short-term rental violations — except for Zrihen and Saadat, whose contact information could not be located — and did not receive any on-the-record responses.

    In the first few weeks after the fire, Feldstein Soto’s office issued more than 250 cease-and-desist letters to owners, landlords and property management groups based on price-gouging tips.

    The price-gouging rules are set to expire July 1.

    Jack Flemming

    Source link

  • L.A. County to buy downtown skyscraper for new HQ despite a ‘hell no’ from Hahn

    The Los Angeles County Board of Supervisors on Wednesday approved the county’s purchase of the Gas Company Tower, one of downtown L.A.’s most prominent skyscrapers, paving the way for the transfer of thousands of workers and public services out of the city’s civic center.

    With a 4-1 vote, the supervisors gave county officials the final green light to move ahead with buying the tower for $200 million.

    The approval came over vehement objections from Supervisor Janice Hahn, who warned that the purchase would sound the death knell for downtown’s civic heart and shunt the county’s workforce to a “souless” office tower on Bunker Hill.

    “None of you here are going to convince me that this is a good idea,” Hahn said before casting her vote against the purchase with a “hell no.”

    County employees are currently based inside the Kenneth Hahn Hall of Administration, a 1960 building named after Hahn’s father, a longtime county supervisor.

    The building is one of several county-owned properties considered vulnerable to collapse in a major earthquake. Officials have estimated that it will cost hundreds of millions to upgrade the buildings, making a new, presumably safer skyscraper an appealing alternative to some on the board.

    “If we know this building is not seismically safe, then we have an obligation and a responsibility to take action,” Supervisor Holly Mitchell said from the room inside Hahn Hall where the board holds its weekly meetings.

    County Chief Executive Fesia Davenport, whose office spearheaded the sale, promised the purchase “will save the county hundreds of millions of dollars” compared with the cost of upgrading the Hall of Administration and other county buildings.

    No supervisors have toured the building themselves, according to a county spokesperson, though several of their staff members have visited.

    The 52-story tower at 555 W. 5th St. was widely considered one of the city’s most prestigious office buildings when it was completed in 1991. It has nearly 1.5 million square feet of space on a 1.4-acre site at the base of Bunker Hill.

    The price is a deep discount from the building’s appraised value of $632 million in 2020, underscoring how much downtown office values have fallen in recent years.

    At $200 million, the county would get the Gas Company Tower for about $137 a square foot, a bargain by historical standards. The county also agreed to pay as much as an additional $5 million in closing costs on the transaction.

    “This opportunity will not last forever,” Davenport warned, adding that the county could finance the purchase in part from money set aside for capital projects.

    Hahn said the transaction was akin to “robbing Peter to pay Paul.”

    “The money being used to pay for this purchase is being stolen from the funds that were meant to keep this building alive,” she said from Hahn Hall.

    Richard Keating, the architect who designed the Gas Company Tower to appeal to corporate America, said it makes sense for a public entity to take ownership now.

    “We’re looking at a decline in need for standard office use, meaning lawyers, architects and accountants are doing things differently” since the pandemic, Keating said. “City and county employees are still hard at work in their office spaces, but they’re tired, old, sometimes decrepit and oftentimes no longer up to code in terms of earthquake” safety requirements.

    “It’s a perfect time to take advantage of some of these more or less empty office buildings.”

    Moving hundreds of county workers into the Gas Company Tower also stands to lift shops, restaurants and other businesses in the nearby blocks by Pershing Square, he said. “I think it’s a good move all the way around.”

    In recent years, the downtown office market has turned against landlords as many tenants reduced their office footprint in response to the COVID-19 pandemic, when it became more common for employees to work remotely.

    Last year, the owner of the Gas Company Tower, an affiliate of Brookfield Asset Management, defaulted on its debt, and the property was put in receivership, in which a court-appointed representative took custody of the building to help creditors recover funds they lent to Brookfield. The building has about $465 million in outstanding loans.

    Other major tenants in the Gas Company Tower include law firm Latham & Watkins and accounting firm Deloitte. The county will assume the tenant leases as landlord.

    When the Gas Company Tower is formally owned by the county, it will be removed from the tax rolls. The building’s property tax bill last year was more than $7.1 million, according to real estate data provider CoStar.

    Tenants would, however, be required to contribute to the tax rolls by an unspecified amount through a “possessory interest tax” that can be levied on private companies leasing public buildings. Tenants in privately owned office buildings also commonly pay a share of the landlord’s property taxes.

    The building is in good condition with “a remaining useful life” of no less than 35 years, according to a recent property condition report prepared for the current owner that was obtained by The Times.

    The report also said the tower and the World Trade Center garage at 333 S. Flower St. included in the deal require about $1.3 million to address urgently needed repairs and deferred maintenance. Additional long-term costs to maintain and modernize the properties were estimated at about $48.7 million over 12 years. Projected costs include roof repairs, refurbishing air conditioning systems and updating the elevators.

    The county currently occupies about 16.5 million square feet of office space for 38 departments, which comprises 6.9 million square feet of leased office space and 9.6 million square feet of owned office space, Davenport said in a memo to the board recommending the purchase of the Gas Company Tower.

    The county spends about $195 million per year on the leased office space, and the property it owns “is in poor condition and old,” Davenport said. Nearly half of it is more than 50 years old.

    By moving staff from both leased office space and aging buildings in poor condition, the county avoids paying rent and the “significant” costs of seismic retrofits and other needed renovations to old buildings such as aging air conditioning, plumbing and electrical systems, the chief executive’s memo said. Funds earmarked for seismic retrofits and other renovations of old buildings will be included in the payment for the Gas Company Tower.

    The county inspected the building and will buy it “as-is,” Davenport said. The Department of Public Works reviewed a seismic report for the tower and agreed with its findings. A county spokesperson said the findings will remain confidential until the deal closes.

    If the county elects to complete a seismic retrofit and other improvements to the Gas Company Tower, it can realize a future return on its investment by selling the building when the market recovers, Davenport said.

    Southern California Gas Co. said in September that it is planning to move from its longtime headquarters in its namesake tower, where it has been a primary tenant since the building was completed, to another skyscraper a block north at 350 S. Grand Ave.

    The utility signed a long-term lease for nearly 200,000 square feet on eight floors in the Grand Avenue building on Bunker Hill often known as Two California Plaza, its new landlord said, and is expected to move by spring 2026 after building out the new offices. SoCalGas will also have an office on the ground floor to serve customers.

    Rebecca Ellis, Roger Vincent

    Source link

  • Ask Our Chief Economist: What Is a Rent Concession? How to Ask, Negotiate, and Save on Your Next Apartment

    Ask Our Chief Economist: What Is a Rent Concession? How to Ask, Negotiate, and Save on Your Next Apartment

    Key takeaways

    • Rent concessions are generally one-time incentives, like three months of free parking, six weeks of free rent, or a waived security deposit
    • Concessions can be great for a renter’s budget by reducing short-term housing expenses, but can lead to surprisingly high costs when it comes time to renew
    • Landlords are more likely to offer concessions when rents are flat or falling, or when demand is low, to attract tenants without lowering rents

    Rents are starting to fall in some pockets around the country, which is good news for renters and a stark contrast from the pandemic-induced record highs. This is because more new apartments continue hitting the market, causing supply to outpace demand. Rents are falling the most in metros that are seeing the biggest gains in supply. 

    But for landlords, too much supply often results in higher vacancy rates. When this happens, they may offer rent concessions to attract tenants and fill units faster. That’s what’s happening now, and is why more than one-third of landlords offered at least one concession in July. These concessions are designed to make leases more appealing without permanently lowering monthly rents.

    Renters may now find themselves in a negotiating position, with opportunities to score a better deal if they know what to look for. But knowing how to spot concessions – and when to take advantage – can be tricky. So what exactly is a rent concession, and how can it benefit you as a renter? 

    We asked Redfin’s Chief Economist, Daryl Fairweather, to help answer some common questions for renters. Let’s dive in, uncover answers, and learn tips along the way. 

    What is a rent concession?

    A rent concession (also called a lease concession) is a temporary discount or incentive that landlords can offer to make a rental more attractive. “Concessions are a way of sweetening the deal for renters without reducing rent,” says Fairweather. “They might include a free month of rent, waived security deposits, or waived fees like application or parking fees.”

    Landlords typically use concessions to fill vacancies more quickly or stay competitive in the market. While these one-time offers can help lower a renter’s upfront costs, they generally don’t affect the longer-term monthly rent, so it’s important to review the terms carefully before signing a lease. 

    Rent concessions vs discounts

    Rent concessions and discounts both offer financial relief, but in different ways. Concessions are temporary perks, like a free month of rent or waived fees, without lowering the monthly rent. Discounts, however, reduce the monthly rent for the duration of the lease, providing ongoing savings.

    Types of rent concessions

    Rent concessions vary widely and can offer savings or added value to renters. You may be offered one or more concessions, depending on your landlord, lease, and any negotiations. 

    Common types of rent concessions include:

    • Free rent: A certain number of months offered rent-free, typically at the start of the lease.
    • Reduced rent: A temporary reduction in the monthly rent for a specific period.
    • Waived fees: Landlords may waive application fees, administrative fees, or move-in fees.
    • Discounted security deposit: A lower security deposit than what’s typically required.
    • Free amenities: Access to services like parking, gym, or storage at no additional charge.
    • Lease flexibility: Offering shorter or more flexible lease terms without the usual premium.
    • Upgraded unit features: Free or discounted unit upgrades, like appliances or flooring.

    Financial consultation with financial advisor

    How to ask for a rent concession

    Asking for a rent concession involves research, negotiation, and documentation. Here’s a breakdown.

    1. Research the market

    If you’re a renter on the hunt for a new apartment, research is vital. Fairweather suggests, “shopping around for what other properties are offering before advocating for concessions from a potential landlord.” This helps you understand the market and gives you a better position when negotiating.

    2. Make a clear request

    Prepare a clear request explaining the current market conditions and be specific about the concession you’re seeking. Whether it’s a reduced rent or waived fees, having the data to back up your request is essential.

    3. Negotiate lease renewals

    If you’re looking to renew your lease with an additional concession, communication is key. Explain how the concession would help you stay longer, and bring market data if necessary. Be open to negotiation and flexible with alternatives if your initial request isn’t feasible.

    4. Document the agreement

    If you and the landlord reach an agreement, make sure the concession is reflected in the lease or added as an addendum. Review all terms carefully before signing, and plan for future expenses when the concession period ends.

    Rent concession considerations for renters

    Rent concessions can make a property more affordable initially, but renters could see a significant increase in overall housing costs once benefits expire. So, it’s important to plan ahead. Here are a few considerations to keep in mind. 

    Calculate the total value of a concession

    To grasp the full benefit of the concession, translate it into a monthly expense and multiply it by the number of months you receive it. A waived security deposit of $1,000 is an immediate $1,000 saving, whereas $60 waived parking for three months is worth $180.

    Anticipate increased expenses once concession ends

    This is crucial. “You could see a large increase in your overall housing expenses once the concessions expire,” cautions Fairweather. For example, if parking costs $60 per month, and you have free parking for three months, that’s a total savings of $180. After the concession, you’ll need to start paying that $60 monthly fee, which increases your housing expenses.

    Look at the fine print

    Notice clauses that might make the concession less valuable in practice, and be a stickler for details. Free parking for 1 month versus 12 months is a big difference, after all. 

    Prepare your budget

    Make sure you aren’t under budgeting or overspending. “You should be ready for increased costs after a concession ends,” continues Fairweather. “A waived security deposit won’t matter at lease renewal time, but waived amenity fees could become an expensive ongoing expense.” Adjust your budget accordingly to improve your finances throughout your lease, and know how much rent you can afford.

    Why do property managers offer rent concessions?

    Property managers might offer rent concessions for a variety of reasons. More often, they’re used to attract new tenants in a competitive market with high vacancy rates. Landlords might also provide concessions to retain existing tenants, reduce turnover costs, or respond to economic downturns.

    Additionally, “Some places restrict rent increases (rent control),” Fairweather points out. “But landlords can still factor in an effective rent increase by offering a concession for just one year, like free parking or a few months of free rent, while still raising the base rent.”

    In this case, while the tenant’s overall payments during the lease remain the same, the official rent listed in the lease will be higher. If the tenant then decides to renew their lease, their monthly payments might rise substantially, unless they negotiate for additional concessions. 

    Why are concessions so common right now?

    New apartments are filling more slowly (absorption rate) than in the past two years due to an imbalance of supply and demand. Many landlords are responding by offering concessions to stir up interest. This trend is largely due to the surge in construction that occurred during the pandemic, which has led to an oversupply of inventory today. 

    So, as new apartments keep entering the market and supply outweighs demand, rents have flattened or even begun falling in some places. “When rents fall or hold steady, concessions become more common,” adds Fairweather. 

    In Sun Belt cities like Tampa and Austin, supply far outweighs demand, so a greater percentage of landlords are offering concessions. Nationwide, one-third of property managers offered concessions in mid-2024. 

    Concessions can also improve the long-term rental market by helping property managers entice new tenants in times of low demand. “They’re a way of breathing life back into their own market, in a sense,” she notes. 

    How to find concessions on an online rental listing

    Finding incentives and concessions on an online marketplace is easy. Most will indicate that a listing is a good value or offers incentives.

    On Redfin, for example, any listing that offers incentives will have the “Deal” watermark on the photo.

     rent-concessions

    When you click on the listing, you can find a more thorough description of what they’re offering. 

    rent-concessions-3

    You can also filter to only show listings with deals or promotions

    rent-concessions-2

    When in doubt, call the property manager or landlord to clarify what incentives they’re offering. Their phone number should be on the listing.

    Jamie Forbes

    Source link

  • How to Screen Tenants: Step-by-Step Guide to Screening Renters

    How to Screen Tenants: Step-by-Step Guide to Screening Renters

    When listing your home for rent, there’s plenty to do like creating an application, finding tenants, and signing a lease agreement. One thing you’ll need to learn about is how to screen tenants during the application process. 

    In this Redfin article, we’ll give you the step-by-step guide to screening renters, from setting application requirements to pre-screening tenants and verifying their information. Whether you’re renting your home in Austin or renting your condo in Chicago, read on to find out how to screen tenants. 

    1. Understand Fair Housing laws

    Before screening any potential tenants, you’ll need to understand Fair Housing laws. While you can choose the renters that fit your requirements, you still need to follow local, state, and federal laws. Under the Fair Housing Act, you can’t reject a tenant based on race, color, national origin, religion, sex, familial status, or disability. 

    Some states have additional protected classes and laws preventing housing discrimination. Familiarize yourself with local and state laws to make sure you’re not inadvertently rejecting a tenant based on protected classes.

    2. Set application requirements

    By setting application requirements, you can better objectively determine the best tenant for your property. Here are some things to consider when setting up your qualifications.

    Income

    It’s common to set income requirements for your property to ensure that tenants are capable of paying rent on time. Many landlords use a rent-to-income ratio to determine income requirements for their applicants. You want to make sure that any prospective tenants are going to be able to cover rent costs without stretching their budget too much. Choosing an income requirement that’s disproportionate to the area you’re renting in may cause your property to stay vacant longer than you’d like. 

    Credit history and score

    Many landlords require a higher credit score, often above 670. This means you’re often looking for tenants who have a credit score in the good range or better. Higher credit scores can be indicative of a more reliable tenant who pays bills on time. However, someone with a lower credit score isn’t necessarily unqualified to rent your home. It’s possible that they’ve recently begun building their credit or have unpaid debts, like student loans. 

    You can read their credit history, ask questions, or ask for references if you want to have a lower credit score requirement for your property. Potential tenants may also have a good rental history report that supports their ability to make on-time payments – even if they have a lower credit score. 

    Previous evictions

    You may want to require applicants to disclose any prior evictions. If an eviction appears during your screening process, consider asking for additional details and requesting permission to contact the previous landlord or property management to better understand the circumstances.

    Criminal history

    Set clear guidelines on how criminal history will be evaluated. While certain convictions, like a DUI, may not be valid grounds for denial, more serious offenses—such as arson—could be. It’s important to ensure that any criteria for denial are based on safety concerns and legal standards. Consult with an attorney to clarify what qualifies as a “dangerous criminal conviction” under the law.

    3. Pre-screen renters

    While pre-screening renters may sound like you’re interviewing them before they submit the application, that’s not the case. The way you pre-screen tenants is through the rental listing itself. Some information you might include:

    • Monthly rent
    • Security deposit
    • Application fee
    • Background check
    • Credit report fee (if applicable)
    • References from previous landlords
    • Smoking policies
    • Pet policies and pet rent
    • Any additional rules

    Listing out information allows tenants to decide whether they want to apply to your rental. For example, if a tenant has multiple pets, and you don’t allow pets in your rental, they likely won’t apply, saving you both time and money. 

    People discussing how to move their house

    4. Create an application

    Having the same application for all applicants is a great way to keep the tenant screening process fair and objective. You’ll need to request information like their current address, employment history, current and previous landlords, references, gross and monthly income, monthly debt payments, and any information about pets. To streamline this, you can use a template or online form builder to ensure consistency. All this information can help identify qualified tenants and help you follow Fair Housing laws. 

    5. Run a credit check

    Running a credit check can be more than just seeing an applicant’s credit score. It can also show any bankruptcies (up to 7-10 years later, depending on the type of bankruptcy), late or missed payments, and other financial problems. You can also use a credit check to verify their name, past addresses, current and previous employers, and date of birth. 

    For more information, you can ask tenants to submit a credit reference. Depending on what the credit report details, you can consider asking the tenant to have a cosigner or a higher deposit amount if you have concerns about their financial situation. 

    6. Conduct a background check

    Another important part of the screening process is to conduct a background check on potential tenants. Running a background check will identify any criminal records and public records, such as court cases. If an applicant’s background check shows violent criminal records, you may be able to legally reject their application. However, certain types of criminal behavior are not legal reasons to turn down an applicant. You’ll need to evaluate each tenant on a case-by-case basis to ensure you’re following any laws – and making the right decisions. 

    what-is-fair-housing-2

    7. Verify other information

    There are other types of information that you’ll need to verify. This includes W-2 forms, recent pay stubs, and speaking with their employer. You can also reach out to their current or previous landlord to learn more about their payment history. Or you can contact any personal references they’ve included on the application. 

    8. Meet potential tenants and ask questions

    It’s not a requirement to meet potential tenants, but if you would like to learn more about them, you can. However, there are plenty of questions that you can’t ask them, as it can violate Fair Housing laws. Here are some example questions to ask:

    • What is your intended move-in date?
    • Why are you moving? 
    • How long do you intend to stay? (ex. 6 months, 12-months)
    • How many people will be living here?
    • Do you have any pets?
    • Do you smoke?
    • Do you have any prior evictions?
    • How many parking spaces are you looking to have?

    Meeting applicants in person or speaking with them on the phone can also give them the opportunity to ask you about the home’s features or any additional questions. 

    9. Decide on tenants

    Once you’ve collected all the information on your prospective tenants, you’ll need to evaluate each one objectively. It can sound like a difficult task, but there are some tips that can make it easier.

    Follow the requirements you’ve listed above – these can highlight which tenants fit your criteria. Don’t judge applicants based on subjective criteria, which in most cases is illegal. Consider leasing to the first tenants that meet your criteria. For example, if you have nine potential tenants who all meet the criteria, consider choosing the first person who applied, “first person, first served.”

    At the end of the day, creating clear guidelines for screening tenants can help you keep the process objective. Finding the right tenant takes time, but following a streamlined process can make the screening potential tenants easier.

    Alison Bentley

    Source link

  • How to Rent a House: 13 Things to Know Before Renting Out Your House

    How to Rent a House: 13 Things to Know Before Renting Out Your House

    After you’ve made the decision between renting vs selling your home, there’s plenty to know before renting your house to your first tenants. From writing a lease agreement to determining rules tenants need to follow and marketing your property, learning how to rent a house can seem complicated. 

    In this Redfin article, you’ll find out it’s not as complicated as you may think to rent your house. Whether you’re renting your home in Phoenix or renting your condo in Dallas, we can help. From tips and tricks to legal requirements, here’s what you need to know before renting your house. 

    1. Set up a financial plan

    Before listing your home for rent, it’s important to understand your current finances and how you’ll be able to make a profit on your rental. You’ll need to factor in the following costs into your rental plan – mortgage payment, property taxes, insurance, repairs, maintenance, and updates. Depending on the local housing market, you’ll have to determine whether it’s worth it to rent your home.

    2. Have a property management plan

    As the property owner, you’ll need to decide who is going to be in charge of the property maintenance and emergency repairs. Is it going to be you or a dedicated property manager? If you plan to live outside of the city your rental property is in, you’ll probably want to consider getting a property manager that your tenants can get a hold of. You’ll also want to make a plan for scheduling maintenance, when you’ll notify your tenant, and how emergency repairs are handled. 

    3. Look into rental property insurance

    You likely already have home insurance and maybe additional flood or fire insurance, depending on where you live. However, you may also want to consider getting rental property insurance to protect your home. This insurance typically covers property damage, liability coverage, loss of rental income, and personal property protection. Rental property insurance doesn’t cover your tenant’s belongings, so it’s also a good idea to require tenants to have renters insurance

    4. Set a rental rate

    One of the biggest questions you’ll need to answer is, how much should I charge for rent? Rental rates will depend on a variety of factors. For example, you’ll need to consider the average rents in your area and how much properties similar to yours are renting for. Additionally, the rental rate will also need to cover your expenses, but be competitive enough to attract tenants. Keep in mind that some cities and states may cap rental rates to prevent you from charging an excessive amount.

    5. Learn the local tenant laws

    On that note, you’ll need to learn any local and state laws regarding your rental and relationship with future renters. There are often laws regarding the security deposit, notice-to-enter, and when you can raise rent. Remember that there are renter’s rights that you can’t violate.

    You also have to follow the Fair Housing Act, which means you can’t reject a tenant’s application based on race, color, age, sex, religion, national origin, family status, or physical or mental disability. Local and state laws may also protect other groups. If you’re unsure of these laws, you can consult with an attorney or the Department of Housing and Urban Development (HUD).

    aerial view of small town in pennsylvania

    6. Determine policies and draft a lease agreement

    There are plenty of basic lease agreements you can use as a template. However, you’ll also want to consider what additional policies to include. Do you want to allow pets? Will you charge a pet deposit or a monthly fee? Does your community have an HOA? Who will pay the HOA fees? 

    In your lease agreement, you’ll also want to include the policies for breaking a lease early and any fees associated with late rental payments, among other items. Remember that a lease agreement is a legally binding document that both parties agree to.

    7. Create a marketing plan for your home

    Marketing your home for rent is just as important as it would be if you were selling your home. You want the property to attract potential renters by highlighting its unique features and location. Consider staging your home and having professional photography taken to showcase your home’s unique appeal. 

    Listing your home for rent online is a great way to reach a large audience of potential renters. This allows them to view your property, see pictures, and schedule a time to view your property. You can often also accept rental applications on the same platform where you list your home for rent. 

    8. Screen potential tenants and show the property

    There are a few ways that you can screen potential tenants before offering a lease agreement. It’s likely that prospective renters will want to tour the property, which gives you the opportunity to meet them in person. You can also screen tenants through the application process.

    • Tenants submit an application: This likely includes an application fee, typically anywhere from $30-$150, which may indicate that an applicant is seriously considering your property. 
    • Ask for their social security number to conduct a credit check: Requesting a credit check from one of the three major credit bureaus – Equifax, Experian, and TransUnion – allows you to see any gaps in their credit history. 
    • Ask for references or past addresses: By speaking with references like an employer or a past property manager, you can find out additional information about a prospective tenant. Did they pay rent on time? Are they consistently employed? 
    • See if they’re employed: Checking to see if a renter has consistent employment and is able to make monthly payments can be an indication that they will pay rent on time. 

    There are plenty of reasons why you cannot reject a tenant’s application, so make sure that you’re following the legal guidelines. Find out what you can include in a rental application denial letter if the tenant isn’t right for your property.

    9. Sign a lease agreement

    If you’ve found the right tenant for your property, the next step is to offer them a lease agreement that you’ll both sign. As previously mentioned, a lease agreement is a legally binding document that both you and your tenant must abide by. The lease agreement will list out how rent will be paid, rules and responsibilities, maintenance, and additional fees and disclosures. 

    Touring apartment

    10. Collect the security deposit

    As part of the lease agreement, you’ll want to collect a security deposit. This amount is typically the equivalent of one month’s rent but can be higher or lower depending on the circumstances. A security deposit can be used to cover any property damage, unpaid utilities or rent, taxes, or other breaches of the lease agreement. 

    You’ll want to put the security deposit in a separate account, as you’ll need to return the security deposit to your tenant if they don’t have any outstanding fees or damage at move-out. If you’re unsure about the security deposit and how much to charge, you can consult with an attorney.

    11. Change the locks

    Before your new tenant moves in it’s a good idea to change the locks and garage door codes. This protects you and your renters from any unauthorized visitors, who may have had a spare key or knew the garage door code. 

    12. Have a rental walkthrough inspection

    When your tenant is ready to move in, schedule a rental walkthrough inspection with them. This inspection gives you both the opportunity to note any problems, defects, or wear and tear on the property. Make note of any issues on a checklist that you and your tenant sign. Send them a copy so they have it for future reference. You can use this checklist when they move out to see if there is any additional damage beyond normal wear and tear. 

    13. Collect monthly rental payments

    The last step is to begin collecting monthly rental payments. You may choose to have your tenant pay the first and last month’s rent in advance, but this is up to you. Whether you’re collecting rent through a check in-person or an online payment system, you’ve officially rented your home.

    Alison Bentley

    Source link

  • Colorado AG claims landlords are colluding to raise rents. What does that mean for Denver renters?

    Colorado AG claims landlords are colluding to raise rents. What does that mean for Denver renters?

    An “Apartment for Rent” sign in the window of a building in Denver’s Speer neighborhood. April 27, 2023.

    Kevin J. Beaty/Denverite

    Are Colorado landlords agreeing to artificially raise rents?

    That’s what Colorado’s Attorney General Phil Weiser thinks. On Friday his office joined a number of other states and the U.S. Justice Department in a lawsuit against RealPage Inc., a software company that uses confidential data from landlords to suggest rent prices.

    Thousands of Denver apartment units — maybe even yours — are owned by companies that use RealPage.

    So, how does price-fixing work? 

    In a normal economy, companies compete for customers by offering the best value for their prices. But collusion happens when companies come together and agree to all raise prices together, forcing consumers to pay more. It’s illegal.

    In this case, landlords aren’t all meeting in a room and agreeing to raise rents. Instead, they submit their confidential vacancy and pricing data to RealPage individually, and the algorithm spits out suggested prices.

    That could be price-fixing, Weiser alleges. 

    He claims RealPage has pushed landlords to end lease perks like rent discounts, and can use information about vacancies to help landlords strategically pull rentals off the market, driving up rents.

    “Half of renters in Colorado spend more than 30% of their income on housing costs,” wrote Weiser in a statement Friday. “Renters should benefit from healthy competition between landlords to find an apartment that fits their budget and needs. But RealPage’s software and market dominance have enabled collusion between landlords to fix rents, set the number of apartment available in the market, and harm renters by forcing them to pay rents above competitive levels.”

    Denverite has reached out to RealPage for comment. The company has generally defended its software as a way to help businesses make decisions.

    What does that mean for Denver renters?

    It’s no secret that high rent levels are a problem in Denver. Affordability and housing are top issues for Denverites, and nonprofit leaders say the high cost of rent is driving up homelessness.

    According to a June report from the corporate watchdog group Accountable.US, the six largest publicly traded apartment companies have all faced lawsuits across the country over their use of RealPage.

    The report says those six companies — Mid-America Apartments, AvalonBay Communities, Equity Residential, Essex Property Trust, Camden Property Trust and UDR — owned nearly 6,000 units in Denver as of March.

    Coincidentally, Accountable.US says the landlords saw a combined $300 million in profits, nationwide, in the first quarter of 2024.

    And that’s just the largest landlords. In April, Denverite reported on high rents and poor living conditions at an apartment complex in Englewood owned by Bell Partners, Inc., a company that has been sued by the Washington, D.C. attorney general over claims of price-fixing through RealPage.

    The Bell Cherry Hills Apartments in Englewood. March 20, 2024.
    Kevin J. Beaty/Denverite

    Does the lawsuit mean rents will come down?

    It’s unclear. Weiser’s lawsuit asks courts to end anticompetitive agreements with RealPage and its customers around sharing sensitive information. It also wants to end what Weiser calls an “illegal monopoly” over this type of software. Currently, the company has about 80 percent of the market for this type of software, according to Weiser.

    “[Housing] is a necessity, much like the other necessities that the public has been comfortable with regulating under antitrust statutes for a very long time and has broad public support, for utilities, for Xcel, for water, things like that,” said Jason Legg a lawyer with Justice for the People Legal Center who has worked on a number of cases involving renters’ rights.

    But lawsuits can take a while, and this emerging technology raises new questions for the courts.

    Earlier this year, a judge dismissed a case involving Las Vegas companies using a RealPage tool. Part of the judge’s reasoning was that the owners were using a third-party software company, RealPage, rather than coordinating directly.

    Legg supports Weiser’s lawsuit, and wants to see the attorney general take action on other fronts, like junk fees that drive up rents.

    “It’s been a culture of the Wild West, in our opinion, and it’s great to see the attorney general stepping in here,” he said. “I hope that the AG doesn’t stop here in being active to ensure that this necessity, like water and electricity and others, are accessible and available to everyone in Colorado.”

    In the meantime, some Colorado state legislators have tried to take on “rent algorithms” with changes to state law. But a bill that would have limited landlords’ use of companies like RealPage died during the legislative session, due to disagreements between legislators, as well as lobbying for real-estate tech companies.

    Work for a company that uses RealPage and want to chat? Drop us a line at [email protected].

    Source link

  • U.S. sues RealPage, alleging its software allows landlords to coordinate rent increases

    U.S. sues RealPage, alleging its software allows landlords to coordinate rent increases

    The U.S. Department of Justice on Friday sued a major real estate firm, alleging the company’s algorithmic software enables landlords across the country to set rent at artificially high rates.

    The lawsuit, joined by several states including California, focuses on software from Texas-based company RealPage. The software is used by many landlords to set rent prices for both vacant units and renewal rates for existing tenants.

    In a truly competitive market, authorities said, property owners would be forced to compete with each other, helping to drive down rental costs for Americans.

    However, according to the lawsuit, RealPage enabled the opposite.

    When becoming a client, supposedly competing landlords share nonpublic information — such as occupancy and rents on executed leases — with RealPage, which then uses that data to recommend rents at individual properties.

    “As Americans struggle to afford housing, RealPage is making it easier for landlords to coordinate to increase rents,” Assistant Atty. General Jonathan Kanter said in a statement.

    RealPage did not immediately return a request for comment.

    The company previously called similar allegations false and misleading, saying clients can decline its recommendations, which at times include dropping rent.

    But in its complaint, the Justice Department pointed to instances where RealPage described its software as a tool for maximizing rent and outperforming the market. Authorities also alleged the company made it more difficult for landlords to reject its recommendations than accept them.

    “There is greater good in everybody succeeding versus essentially trying to compete against one another in a way that actually keeps the entire industry down,” a RealPage executive said, according to the lawsuit.

    At another point, RealPage described its tools as ensuring landlords are “driving every possible opportunity to increase price even in the most downward trending or unexpected conditions,” the complaint says.

    Antitrust enforcement has been a focus of the Biden administration. The Justice Department has sued major companies such as Google and Apple, alleged they engaged in anticompetitive behavior.

    Vice President Kamala Harris has also criticized the use of rent-setting algorithms while running for president.

    In a statement, Atty. Gen. Merrick B. Garland said the Justice Department would continue to aggressively enforce antitrust laws.

    “Americans should not have to pay more in rent because a company has found a new way to scheme with landlords to break the law,” Garland said.

    Andrew Khouri

    Source link

  • Airbnb vs Renting Out Your House: Pros and Cons to Consider

    Airbnb vs Renting Out Your House: Pros and Cons to Consider

    When deciding between listing your property on Airbnb or opting for a traditional rental, it’s essential to weigh the pros and cons of each approach. Whether you’re looking for flexibility, a steady income, or less management hassle, both options come with unique benefits and challenges.

    In this Redfin article, we’ll explore the key factors to consider, helping you make an informed decision that aligns with your financial goals and lifestyle preferences. So, if you’re renting out your home in New Orleans or your beachfront condo in San Diego, there’s an option that works for you.

    Do you want a short-term or long-term rental?

    Short-term rentals, like those on Airbnb, offer flexibility and the potential for higher earnings, especially in popular locations, but require more frequent management and upkeep. On the other hand, long-term rentals provide a stable, predictable income with less turnover, but they come with longer commitments and potentially more complex tenant relationships. Understanding your goals and capacity for property management is crucial in making the right choice.

    Pros of long-term rentals

    Consistency

    The biggest benefit of long-term rentals is consistency. You’ll have a monthly rental income, so there shouldn’t be any gaps in income. You’re able to create a consistent screening process for new renters, so hopefully no bad tenants. You’ll be able to learn about your local market to establish a competitive rental strategy and generate income. 

    Protection from market fluctuations

    Renting your property long-term offers you protection from market fluctuations. It allows you to have a stable real estate investment strategy. When you rent long-term, you’re able to lock in a set rate for an extended period of time, which can help combat any dips in the rental market. As long as you have a lease in place, the tenant pays that rent for the whole term, even if comparable rents go down.

    Reliable property value

    Renting property long-term can also provide you with a more reliable property value. You’re investing for a long period of time, so it’s more likely your property will hold its value over time. Long-term rentals are also generally better for cash flow purposes. With a long-term rental, you’re able to spread the cost of your mortgage over a longer period of time, which can make it easier to manage your finances.

    Cheaper overhead

    When you rent your property long-term, you also tend to have lower overhead costs. This is because you don’t have to worry about the cost of advertising or the cost of turnover, both of which are significant when you’re renting short-term.

    You also collect a security deposit to address issues beyond normal wear and tear – and don’t have to pay to furnish the home. These benefits don’t necessarily mean a huge profit when it comes to renting, but they can mean improved cash flow so you can begin making a little money sooner.

    No seasonal fluctuations

    Another big advantage of long-term rentals is that they’re not subject to seasonal fluctuations. With a long-term rental, monthly rental income is the same every month of the year, which can make budgeting easier.

    Better tenant screening

    Because you’re not looking for tenants who are only staying for a short period of time, you can be more selective in your screening process. This can help you avoid problem tenants and make sure that you have good, reliable renters on your property. You’re able to take the time to run proper background checks, look into credit histories, and collect references from previous landlords and current employers. You have the ability to be more selective about who you allow to live on your property.

    Fewer restrictions

    When it comes to local laws, long-term rentals also tend to have fewer restrictions compared to short-term rentals. There are often specific regulations and zoning laws that apply to short-term rentals that long-term rentals don’t have to follow. As a result, property management is much easier, and you may have more flexibility in how you use your property.

    Cons of long-term rentals

    Less flexibility

    When renting your property long-term, you have less flexibility to use your property. With a year-long lease, you don’t have the option to break the lease early. There are a few times when it’s possible to break a lease, but you need to be careful. For example, you can’t end your tenant’s lease early because you want your friends to use the property.

    Market fluctuations

    With a long-term rental, you can’t change the rent price if you see that the rental market is getting more expensive. There are many stipulations about how much and when you can increase a tenant’s rent. You also can’t increase their rent in the middle of a lease agreement, even if costs have risen – you’ll need to wait until the lease expires. 

    Lease agreements

    A lease agreement is a legally binding document that both you and your tenant have to sign. You’ll need to write a lease agreement that covers all aspects of renting – security deposit, maintenance, rent costs, parking addendums, eviction notices, rules, and much more. Once signed, you and the tenant have to abide by the rules outlined in the lease agreement. 

    view of homes near lake in maine

    Pros of short-term rentals (Airbnb) 

    More flexibility

    As an Airbnb host, you have more flexibility when renting your property. For example, if you like to have friends and family use your property or you use the property during certain times of the year, Airbnb may make more sense. Since you can set the dates your property is available, you don’t have to worry about a long-term lease preventing you from enjoying your property.

    Potential for more profit

    Since your home is a short-term rental, you can change the prices during busier times of the year. With a long-term rental, it’s illegal to raise a tenant’s rent in the middle of their lease term. If your tenant is on a month-to-month lease you can raise the rent, but with proper notice, often 30 days in advance. With Airbnb, you have more flexibility when it comes to raising the prices. For example, you have the option to have higher prices for weekend bookings and lower prices during the week.

    No lease agreement

    As an Airbnb host, you don’t have to deal with creating a formal lease agreement. Airbnb has its own set of rules, in addition to the house rules included in your listing. If a guest breaks any of the rules, you can discuss the matter with Airbnb directly. 

    Cons of short-term rentals (Airbnb)

    Although Airbnb has a “host guarantee” to protect landlords, there are still a lot of downsides to using your property for short-term rentals.

    More upfront costs to you

    Depending on the season, you may be able to adjust prices and bring in more Airbnb income. However, you may also have more costs associated with operating a vacation rental. Unfortunately, damages are more common in short-term rentals. You’ll also have the added cost of having to clean and restock or replace your property with certain items after each rental.

    Seasonal vacancies

    Airbnb hosts also face seasonal trends in the short-term rental market. Your property could sit empty a few months every year or receive minimal bookings during the off-season.

    Local laws may work against you

    Some cities also limit the number of days an Airbnb rental is available, forcing you to leave your property vacant at certain times during the year.

    Advertising costs

    In addition to the time you’ll spend keeping your property clean and ready for guests, you’ll also put in a lot of energy to attract them. Marketing an Airbnb property requires a lot of work. You’ll have to take high-quality photos, but you should also change them each season to keep your property relevant. You’ll also have to write a compelling property description to showcase why your home is a great place to stay and what attractions are nearby.

    Airbnb vs renting out your house

    At the end of the day, renting your property can be a great investment, whether it’s Airbnb or renting out your house long-term. Whether you’re looking for the flexibility of a short-term rental or the stability of monthly rental payments that come with a long-term rental, there’s an option for your goals.

    Alison Bentley

    Source link

  • Can a Landlord Break a Lease Early? Reasons You May Need to and How to Do It

    Can a Landlord Break a Lease Early? Reasons You May Need to and How to Do It

    When thinking about someone breaking a lease, you most likely picture a tenant who ends the lease early. However, that’s not always the case. In some circumstances, it’s the landlord who needs to end the tenant’s lease early. So, can a landlord break a lease early?

    Landlords can break a lease, but only within specific circumstances. In this Redfin article, we’ll outline the reasons you can break a lease agreement and how to tell your tenant in advance. Whether you’re a landlord renting your home in Phoenix or a property manager leasing an apartment in Denver, find out when you can break a lease early.

    Reasons landlords may need to break a lease agreement

    There are a variety of reasons that can lead to property owners serving an early termination notice to a tenant. This isn’t the same thing as an eviction, although there are some common reasons for breaking a lease and wanting to evict a tenant.

    Landlords often fit one of the following reasons for breaking a lease or rental agreement.

    • You want to sell the property or decide to live in it yourself.
    • The tenant has violated the rental agreement or is behind on paying rent.
    • The tenant committed illegal activities on or near the property.
    • The property is in poor condition and the necessary repairs are too expensive for you to pay for.

    Breaking a lease is a difficult decision for landlords, but it’s important to understand the consequences of doing so before taking any action. Most states have very specific laws dealing with breaking a lease by either a tenant or a landlord. Understanding local law first ensures the reason you’re providing for breaking your lease isn’t going to get you in trouble with the renter.

    Adding a termination clause in your lease agreement

    Even if you don’t anticipate a reason for terminating a lease agreement early, it’s best to include an early termination clause in your lease. That way, you’re protected and expectations are clear, should you need a tenant to vacate a property before their lease is up.

    A good early termination clause will follow the local law and set out the process for this situation. You need to spell out what must happen, no matter who’s initiating the lease termination. Include everything from how much notice you need to how you’ll notify the tenant about ending the lease early. A typical notification period is between 30 and 60 days in advance of the date a tenant needs to move out.

    Most landlords prefer a written notice whether they’re receiving notification or giving it to the tenant. If you’re breaking the lease, you’ll most likely want to put your written notice on the tenant’s door, as well as send a digital copy. This ensures they get the message.

    This clause should also specify any fees the tenant will have to pay if they’re in violation of the lease terms, and what will happen to their security deposit and any prepaid rent.

    organizing-mistakes-4

    How to terminate a lease early as a landlord

    To avoid an eviction lawsuit, you must carefully follow the process you’ve spelled out in your existing lease and comply with local laws. If you can wait for the lease term to finish, it’s always easier and less complicated. However, if you need to end a lease early on your rental property, here’s what to do:

    • Notify the tenant in writing of your intent to terminate a lease.
    • Give the tenant a reasonable amount of time, 30-60 days, to find a new place to live.
    • Recommend the tenant to another landlord or rental housing authority to help them search.
    • Discuss how this impacts the tenant’s security deposit and/or paying rent for the remainder of their stay.

    In theory, if it’s you who decides to break the lease, there are no fees the tenant must pay. That typically only happens if they contact you to move out early. There also may only be fees if the lease is a fixed term, rather than a month-to-month lease.

    Additionally, all deposits made at the time the lease was signed are treated the same way even if you break the lease. You should use the security deposit to assess damages, and return it (or as much as possible) within a proper amount of time once you’ve set the new move-out date. You’ll want to do the same for the last month’s rent deposit if that was part of the lease. You can use it to cover the tenant’s final month of rent, rather than asking them to pay again. . 

    What if my tenant has a month-to-month lease?

    Having a tenant on a month-to-month lease definitely makes it easier to ask them to move out of a property in a shorter time frame. A month-to-month lease only ensures the renter access to the property one month at a time. For this reason, you have the ability to ask them to move out at almost any point.

    Though you must provide 30 days’ notice, it’s not really the same thing as terminating a lease for a month-to-month renter. They’ll most likely expect the notice to come from you at some point.

    Once your tenant completes their first year on a lease, offering a month-to-month rental agreement may be a good strategy. It can make being a landlord easier and gives you more flexibility with your property.

    How does my tenant pay rent if the lease ends early?

    Even if you initiate the process to terminate a lease, your tenant must pay any unpaid rent they owe you. They should also keep paying rent until they move out. If your tenant paid last month’s rent upfront, you can apply that to the new last month your tenant will be on the premises.

    Multi color Leaves in Neighborhood

    Local laws when breaking a lease

    Many states and cities have similar laws when it comes to either a landlord or tenant terminating a lease early. However, these laws can vary depending on your location. Laws can differ on how much notice you have to give, what fees are charged, and the valid reasons for breaking a lease early.

    An important factor in the process though is keeping tenants’ rights in mind. Based on state laws, tenants may be able to:

    • Remain in the property until a new tenant is found.
    • Receive compensation for any damages caused by the landlord breaking the lease.
    • File a lawsuit against the landlord.

    To avoid these issues and any extra costs, you want to approach the whole process very carefully. This is especially true if you’re taking this step with prospective tenants or are selling your home. If you’re unsure of your local or state laws, you can consult with an attorney.

    When you can’t terminate a lease early

    The only time you can really terminate a lease without any reason is at the actual end of a lease term. At that point, it’s your call to not renew the lease agreement. However, there are situations where you may want to terminate early, but can’t. These include:

    • You don’t like your tenants, but they’re still following all the terms of the lease and the law.
    • You want to rent your property to a friend or relative, although you have a current tenant in place.

    Even if you have a good reason to terminate a lease early, you may want to start with a warning letter, giving a bad tenant the opportunity to fix their issues. For example, this could be appropriate in an instance where the tenant is late on rent or has possibly broken a term of the lease that they can fix. An example of a fixable issue is if they recently got a pet, but pets are not allowed in the lease terms. If the tenant rehomes the pet within your set time frame, you may not want to follow through with terminating the lease.

    On the flip side, if you do decide to terminate a lease, and the tenant refuses to leave, you’ll have to evict them. Eviction is a costly legal process that requires an attorney. With so many legal factors to consider, deciding to terminate a lease early isn’t a decision to take lightly. 

    Deciding to terminate a lease on a rental property

    There are many reasons why you may need to break a lease early, but you still have to navigate things carefully. Maintain solid contact with tenants and be clear on when and why they need to vacate. You’ll need to handle everything correctly which means it’s not always the right decision to terminate a lease early. Weigh the pros and cons, make sure you have a valid reason, provide proper notice and protect yourself throughout the process.

    Alison Bentley

    Source link

  • Steward’s creditors accused of ‘brinkmanship’

    Steward’s creditors accused of ‘brinkmanship’

    BOSTON — The Healey administration is lashing out at Steward Health Care System’s creditors for seeking to block $30 million in state funding to help transition the bankrupt company’s hospitals to new owners.

    In a new filing in U.S. Bankruptcy Court, Assistant Attorney General Andrew Troop accuses a group representing creditors seeking to collect $9 billion in debt from Steward of engaging in “brinksmanship” in an effort “to wring out more value from qualified bidders or the commonwealth to salvage their own bad financial, investment or lending decisions.”

    “Many of these creditors seem to have lost sight of the importance of providing safe healthcare over the long term, and instead seem intent on saddling bidders with potentially critical levels of debt or obligations, which will only make this crisis a recurring one,” Troop wrote in the seven-page statement.

    While the state is “unable” to stop Steward from closing the two hospitals, Troop said it still has “significant police powers” to intervene in the federal bankruptcy process if it “does not result in a clear path to the sale of the hospitals.”

    The fiery statement comes as a federal judge in Texas weighs a request from a group representing Steward’s myriad creditors to reject Gov. Maura Healey’s plan to devote $30 million in repurposed Medicaid funding to help transition the sale of six of Steward’s hospitals as part of the company’s bankruptcy proceedings.

    Steward plans to put its 31 U.S. hospitals – including Holy Family’s locations in Methuen and Haverhill – up for sale to pay down $9 billion in outstanding liabilities owed to creditors. The company filed for federal bankruptcy protections in May.

    Steward said it was not able to find buyers for Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer and announced plans to shut down the facilities in the next 30 days.

    U.S. Bankruptcy Judge Christopher Lopez, who is overseeing the case, approved the request to close the hospitals following a hearing Wednesday in a Texas courtroom.

    Bids on Steward’s Massachusetts hospitals and other states were due last week, but the company has not disclosed prospective buyers. A hearing on the sales was scheduled for Thursday, but the company asked the federal judge presiding over the case to postpone the proceedings until Aug. 13, without citing a reason.

    Last week, Healey officials announced plans to provide $30 million in Medicaid funding to help ensure a “smooth transition” to new ownership for the company’s six remaining hospitals. Healey told reporters earlier this week that “not a dime” of the money will go to Steward or its management team.

    But in a court filing this week, a committee representing Steward’s creditors asked Lopez to block the move, arguing that the transition funding would come “at the expense of the rest of debtors, their estates and their creditors.”

    On Wednesday, Lopez approved a request by Steward and others to reject a master lease for all the hospital properties, saying the move “is in the best interests of the Debtors, their respective estates, creditors, and all parties in interest.”

    The Attorney General’s Office sided with Steward on the lease issue and has accused the hospitals’ landlords – Medical Properties Trust and Macquarie Asset Management – of trying to block the move “to extract concessions from the Steward estate and their mortgagee.

    “These hospitals – while each in name a lessee – have been forced to pay the costs typically associated with property ownership, including real estate taxes, maintenance, and insurance,” Troop said in the latest court filing.

    Steward’s landlords objected to the request to reject the master lease, arguing in court filings that federal law prohibits the company from stopping rent payments “when their express intention is to continue conducting business in the landlords’ property pending a proposed sale.”

    “If a debtor were permitted to reject a lease and stop paying rent, while continuing to conduct business in the landlord’s property, every debtor would do that,” lawyers for the two property owners wrote in a legal filing. “But of course that is not allowed.”

    During the hearing Wednesday, Lopez also heard arguments for approving the Healey administration’s request to use the $30 million for transition costs, but it was not clear when he would issue his ruling on the funding.

    Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhinews.com.

    By Christian M. Wade | Statehouse Reporter

    Source link

  • How Long Does My Landlord Have to Fix Mold?

    How Long Does My Landlord Have to Fix Mold?

    One of the most unwelcome issues in any home or rental property is the appearance of mold. It’s a tough problem to combat since there’s no sure way to keep it from showing up. There can be many reasons why mold occurs, and some are difficult to prevent. 

    There’s always a chance landlords or tenants will come across mold in a rental property. If you do find mold, it’ll need to be taken care of as quickly as possible, as it’s a health hazard to those living in the home. Here’s what to know about removing mold from a rental property and how long a landlord has to fix mold.

    Is a landlord responsible for mold in a rental?

    Ultimately, since the landlord owns the home, they’re responsible for taking care of the mold. It’s the landlord’s responsibility to make sure the property is safe and habitable for tenants. That means mold shouldn’t threaten the health of those living there.

    Since mold is uncontrollable and unpredictable, landlords should educate your tenants on mold and how to prevent it in the home. Let tenants know the places where mold is common, like under sinks, in the corners of bathrooms, and other humid areas. Encourage tenants to check for potential mold often. Be sure renters understand they should let landlords know as soon as possible if they find mold so the problem can be corrected before it gets worse.

    How long does a landlord have to fix mold?

    Once a tenant reports mold, landlords typically have 14 days to check it. Two weeks is common in most states, but always be sure to check your state’s regulations. If the problem is mold, the landlord has 30 days to take care of the problem.

    When getting rid of mold in your rental, the solution isn’t to just remove the current pieces of mold from the home. Landlords will need to also fix the underlying cause of the mold. For example, there may be a leak that caused water to seep into the walls and floors and mold grew due to the moisture. In that case, landlords need to fix the walls and floors where the mold is present and fix the leak to prevent it from happening again in the future.

    Mold in home because of Humidity

    Checking for mold in a rental property

    Before a tenant even moves in, landlords should thoroughly clean and check the property for any mold or signs of future mold issues. Common places where mold appears are underneath kitchen sinks and in bathrooms. Note other places that may have extra humidity and moisture in the rental, like the laundry room, closets, or basement corners, as these are often environments where mold grows unnoticed.

    Landlords can also use an at-home mold testing kit if there’s something they think might be mold or they can call in a professional to check the home out.

    How to remove mold from a rental property

    Depending on the type of mold and how much of it there is, landlords have a few ways to get rid of mold. Cleaning with a bleach solution can get rid of basic surface-level mold, but make sure to clean it thoroughly.

    However, if there’s a large quantity of mold, and it’s found inside walls or underneath the carpet, landlords likely need to call in a professional. Mold removal companies will ensure that they remove and properly dispose of all of the mold. They’ll know where and how to check for mold in all areas of the home.

    If there’s any doubt about whether or not a rental property has mold, don’t hesitate to get a professional opinion. Spending a little bit of money for an expert to check for mold at the beginning can end up saving lots of money and hassle in the end, as it can avoid future problems that could be costly.

    living room with lots of windows and curtains

    Key tips for preventing mold

    It’s much harder to fix a mold problem than it is to prevent it from happening. Landlords and tenants can’t always control whether or not mold starts to grow in a rental since mold is unpredictable. However, there are things both parties can do to make it so the rental property doesn’t foster mold growth.

    Airflow and ventilation

    Make sure there’s good airflow and ventilation throughout the home, especially in places where mold is likely to grow. The bathrooms should have windows you can open to let out any additional moisture from bathing and showering, and a working exhaust fan in each bathroom.

    If the rental property is in a humid location, like a home in Orlando or an apartment in Houston, landlords may want to consider installing a dehumidifier to extract the excess moisture from the air.

    Check for leaks often

    Leaky sinks can create an environment in which mold likes to grow. Check underneath sinks often to ensure there aren’t any leaks — even a small one can cause big mold problems. Tenants should report any leaks immediately, no matter how big or small the leak is, so maintenance can take care of it.

    Educate yourself about mold

    Learning about mold and how and where it can grow will help keep the rental mold-free. Tenants should reach out to their landlord as soon as they find mold or even if they think they’ve found signs of mold so it can be removed.

    Be thorough and exercise caution

    The best thing to do as tenants and landlords when it comes to mold is thoroughly preparing your property and exercise caution. You can’t control mold in a rental property, but you can take preventative measures and check often to keep any potential problems in check. If you’re careful, you’ll create a safe, healthy environment for your tenants, and you shouldn’t have any big mold issues on your rental property.

    Alison Bentley

    Source link

  • What to Include in a Proof of Residency Letter (Template)

    What to Include in a Proof of Residency Letter (Template)

    As a landlord there are a variety of things you can expect a tenant to ask you – and one of those things is for a proof of residency letter. Tenants may need proof of residency to change their address on their driver’s license, set up utility bills, or even update their voter registration. So, what exactly do you need to include in a proof of residency letter?

    At Redfin, we’re here to help. So whether you’re a landlord renting your home in Dallas or a property manager renting apartments in Phoenix, here’s what you need to know about proof of residency letters.

    Marcus Lindstrom via Getty Images

    What is a proof of residency letter?

    A proof of residency letter is a sworn statement that confirms that the person named in the letter actually lives at the current address listed. It ensures the contact details they’ve provided match up with your official documents. As a landlord, you’re a reliable source to provide proof that your tenant actually lives at the address. 

    As a result, the letter you submit is considered a legally binding document. The proof of residency letter confirms the recipient’s address, so your tenant has evidence they live where they say they live.

    Why might a tenant need a proof of residency letter?

    While a variety of documents can establish residency, some situations require the individual to provide proof from more than one source. This is why they may need a residency letter along with additional documents.

    Possible scenarios where a proof of residency letter is necessary include:

    • Applying for in-state tuition at college
    • Going to the Department of Motor Vehicles to update (or get) a driver’s license
    • Getting a local library card
    • Verifying a child lives at a particular address to go to school in a specific school district
    • Establishing a tenant lived at a certain address for a specific period of time
    • Applying for a job with any government agencies
    • Gaining eligibility for specific insurance programs
    Modern townhouses
    AnthonyRosenberg via Getty Images

    Proof of residency letter template

    To make it quick and easy to generate a residency letter for your tenants, this proof of residency template can help.

    Today’s date

    The name and address of the party requesting the residency letter

    Dear ____________,

    This letter is to confirm that [Tenant’s legal name] resides within the property located at [Complete address information]. [Tenant’s name] has been a tenant at this property since [Start date of lease], and their current lease expires on [Date].

    If you have any questions, please do not hesitate to contact me.

    [Your actual signature]

    Your Name

    Job title

    Your contact information

    Past proof of residency letter template

    For tenants who lived in your rental property previously, but need to establish proof of residency during that time frame, you’d use a slightly different template.

    Today’s date

    The name and address of the party requesting the residency letter

    Dear ____________,

    This letter is to confirm that [Tenant’s full legal name] lived within the property located at [Complete address information] from [Start date] to [End date].

    If you have any questions, please do not hesitate to contact me.

    Sincerely,

    [Your actual signature]

    Your Name

    Job Title

    Your contact information

    belongings in a house

    Do you need to get the letter notarized?

    While it’s not required to have a notary public stamp a letter to prove residency, it often helps make the document more official. Many landlords will opt to get notary proof for their residency letters, especially if they know the tenant is using the document as a cover letter for other documents that establish proof of address.

    Other options for proof of residency

    Oftentimes, your tenant will need more than one piece of proof to establish residency. They’ll likely use your letter in addition to other documents that feature their mailing address.

    If your tenant ever asks you what other documents establish residency, options include:

    • A valid driver’s license
    • Utility bill
    • A piece of mail sent to your current address
    • Lease agreement
    • Voter registration card
    • Bank statements
    • Credit card bill

    Proof of residency letter vs. landlord reference letter

    A proof of residency letter is different from a landlord reference letter. A landlord reference letter is a letter written by a property owner or manager that attests to the good character of the tenant. Reference letters are often used for former tenants looking to rent in a new location.

    A landlord reference letter may help convince a future landlord that this tenant would be a good choice. It may lead to follow-up questions from the potential landlord related to how well the tenant paid monthly rent, among other key points, that make a tenant a good renter.

    A proof of residency letter only confirms that the person named in the letter actually lives at the address listed, or was a resident within a specified period.

    While both documents serve different purposes, they can complement each other in various situations. Proof of residency letters primarily focus on verifying an individual’s address history. They may be requested for purposes like obtaining a driver’s license, enrolling in school, or applying for government benefits. It essentially confirms a person’s physical presence at a specific location.

    What should you include in a proof of residency letter template?

    Since a proof of residency letter is an official testimony, it should be professional. Use a business letter format, which means you should make your residency letter clean and short. You want to get to the point as quickly as possible in a residency letter.

    The necessary information your proof of residency letter should include is:

    • Your name, address, and contact information
    • Date
    • Name and full address of the person/organization making the residency claim
    • Complete address of the rental property
    • Legal name of the person whose residency is in question
    • The timeframe the individual lived in the rental property (the lease term), or whether they’re a current resident
    • Your signature

    You can consider adding a witness signature by the current tenant or having the document notarized. Both add an extra layer of professionalism to the letter.

    Offering a residence letter makes you a better landlord

    Providing a proof of residency letter for your tenants is an easy way to be a good landlord. This supplemental evidence can make a big difference for your tenants, and as long as you’ve got a template ready to go, generating a proof of residency letter takes barely any time at all. Keeping tenant-landlord relationships strong isn’t always easy, and this is one way to keep things going smoothly between the two of you.

    Alison Bentley

    Source link

  • Steward’s creditors accused of ‘brinkmanship’

    Steward’s creditors accused of ‘brinkmanship’

    BOSTON — The Healey administration is lashing out at Steward Health Care System’s creditors for seeking to block $30 million in state funding to help transition the bankrupt company’s hospitals to new owners.

    In a new filing in U.S. Bankruptcy Court, Assistant Attorney General Andrew Troop accuses a group representing creditors seeking to collect $9 billion in debt from Steward of engaging in “brinksmanship” in an effort “to wring out more value from qualified bidders or the commonwealth to salvage their own bad financial, investment or lending decisions.”

    “Many of these creditors seem to have lost sight of the importance of providing safe healthcare over the long term, and instead seem intent on saddling bidders with potentially critical levels of debt or obligations, which will only make this crisis a recurring one,” Troop wrote in the seven-page statement.

    While the state is “unable” to stop Steward from closing the two hospitals, Troop said it still has “significant police powers” to intervene in the federal bankruptcy process if it “does not result in a clear path to the sale of the hospitals.”

    The fiery statement comes as a federal judge in Texas weighs a request from a group representing Steward’s myriad creditors to reject Gov. Maura Healey’s plan to devote $30 million in repurposed Medicaid funds to help transition the sale of six of Steward’s hospitals as part of the company’s bankruptcy proceedings.

    Steward plans to put its 31 U.S. hospitals — including Holy Family’s locations in Methuen and Haverhill — up for sale to pay down $9 billion in outstanding liabilities owed to creditors. The company filed for federal bankruptcy protections in May.

    Steward said it wasn’t able to find buyers for Carney Hospital in Dorchester and Nashoba Valley Medical Center in Ayer and announced plans to shut down the facilities in the next 30 days.

    U.S. Bankruptcy Judge Christopher Lopez, who is overseeing the case, approved the request to close the hospitals following a Wednesday hearing in a Texas courtroom.

    Bids on Steward’s Massachusetts hospitals and other states were due last week, but the company hasn’t disclosed prospective buyers. A hearing on the sales was scheduled for Thursday, but the company asked the federal judge presiding over the case to postpone the proceedings until Aug. 13, without citing a reason.

    Last week, Healey officials announced plans to provide $30 million in Medicaid funds to help ensure a “smooth transition” to new ownership for the company’s six remaining hospitals. Healey told reporters earlier this week that “not a dime” of the funds will go to Steward or its management team.

    But in a court filing this week, a committee representing Steward’s creditors asked Lopez to block the move, arguing that the transition funding would come “at the expense of the rest of debtors, their estates and their creditors.”

    On Wednesday, Lopez approved a request by Steward and others to reject a master lease for all the hospital properties, saying the move “is in the best interests of the Debtors, their respective estates, creditors, and all parties in interest.”

    The Attorney General’s office sided with Steward on the lease issue and has accused the hospitals’ landlords — Medical Properties Trust and Macquarie Asset Management — of trying to block the move “to extract concessions from the Steward estate and their mortgagee.

    “These hospitals – while each in name a lessee – have been forced to pay the costs typically associated with property ownership, including real estate taxes, maintenance, and insurance,” Troop said in the latest court filing.

    Steward’s landlords objected to the request to reject the master lease, arguing in court filings that federal law prohibits the company from stopping rent payments “when their express intention is to continue conducting business in the landlords’ property pending a proposed sale.”

    “If a debtor were permitted to reject a lease and stop paying rent, while continuing to conduct business in the landlord’s property, every debtor would do that,” lawyers for the two property owners wrote in a legal filing. “But of course that is not allowed.”

    During Wednesday’s hearing, Lopez also heard arguments for approving the Healey administration’s request to use the $30 million for transition costs, but it wasn’t clear when he would issue his ruling on the funding.

    Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhinews.com.

    By Christian M. Wade | Statehouse Reporter

    Source link

  • How to Find Landlords That Accept Section 8 Vouchers

    How to Find Landlords That Accept Section 8 Vouchers

    Many renters know that finding affordable housing is tricky these days. As a result, many low-income families turn to housing vouchers to help cover the cost of the rent. More than 5 million households use federal rental assistance through the U.S. Department of Housing and Urban Development’s Section 8 program, and about 70 percent of those individuals are older people, children and people with disabilities.

    Still, many renters may not know where to look to find private landlords that accept housing vouchers. Here are some tips, along with an overview of what housing vouchers are and who’s eligible to receive them.

    What are U.S. Department of Housing and Urban Development (HUD) housing vouchers?

    HUD’s Housing Choice Voucher Program, also known as Section 8, helps low-income people afford homes to rent, whether it’s an apartment, single-family house or townhouse.

    A public housing agency (PHA) administers the housing choice voucher. But, it’s up to low-income families to find rentals and private landlords that accept vouchers.

    A private landlord receives a payment from the PHA on behalf of the renter participating in the Section 8 program. Tenants pay the difference between the rent payment and what the voucher covers.

    The program benefits private landlords and tenants. Landlords receive a voucher for fair market rates, while a tenant can find rental housing that better fits within their budget.

    How do you qualify for Section 8 vouchers?

    Public housing agencies determine eligibility for Section 8 vouchers based on a household’s income and the number of family members living in the home. The rental assistance applies only to U.S. citizens and specific non-citizen groups. There are also financial requirements to qualify.

    Financial requirements for Section 8

    To be eligible, a family can’t earn more than 50 percent of the area’s median income. The local housing authority is also required by the federal housing program to offer 75 percent of its housing choice vouchers to people with incomes not exceeding 30 percent of the local median income.

    Waiting lists for Section 8

    There are often waiting lists to access housing vouchers, usually a few months but sometimes longer. The length of a waiting list depends on location.

    The housing authorities will contact you once you reach the top of the list. Then it’s time to find apartments and other rental property that take Section 8.

    Save money for home cost
    ridvan_celik via Getty Images

    How do Section 8 vouchers work?

    Low-income individuals and families have a choice in housing. Once the PHA selects someone for the federal housing program, they select the type of rental that best meets their needs but that also accepts the housing choice voucher.

    There are two types of housing choice vouchers: project-based vouchers and tenant-based vouchers. Project-based vouchers must use specific housing developments. You can use tenant-based vouchers for any home, as long as the owner will accept the voucher and the property meets the program requirements.

    When renters find houses or other suitable property where the private landlord accepts the voucher and works out the terms of a lease agreement, the housing and urban development agency inspects the home to make sure the landlord is asking for a reasonable payment.

    The voucher covers part of the rent amount, based on how much renters can afford.

    How to find affordable housing that accepts vouchers?

    Once you’ve been approved for the program, the next step is to find houses and apartments that accept Section 8 vouchers. And, this is tough, depending on where you live.

    Tips to find apartments and other rentals that take Section 8

    To find apartments and other rentals owned by private landlords that accept Section 8 vouchers, follow these steps:

    • Start with your local PHA, which can point you in the direction of property owners that accept vouchers. The Department of Housing and Urban Development website lists PHA contact information by state.
    • Check with your local HUD office to apply for the program and to learn about rentals that accept vouchers.
    • Ask friends and family members for recommendations for private landlords that accept vouchers.
    • Search Rentals.com to find properties in your area. You can filter your search to find “income-restricted” rentals.

    Do landlords have to accept housing vouchers?

    Section 8 allows private landlords to accept housing vouchers and rent to low-income people at a fair market rate. The PHA signs a lease with private landlords and pays a piece of the rent, while tenants must pay the difference.

    However, private landlords are not required to accept Section 8 vouchers and participate in the program, under federal law. Some states require private landlords to accept vouchers.

    Connecticut, Maryland and Massachusetts are states where landlords can’t refuse to rent to tenants who are eligible for Section 8, according to the American Apartments Owners Association.

    what-is-brentwood-ca-known-for-3

    Can Section 8 vouchers be used anywhere?

    Not all private landlords accept Section 8. Many apartments and houses around the country will accept Section 8 — as long as they meet the federal government’s rules and regulations.

    Private landlords screen renters

    Whether it’s apartments or a single-family home, a landlord still screens renters when they accept Section 8. This usually focuses on a background check and credit check to learn about the individual’s criminal history and rental history.

    The Section 8 program verifies a renter’s income before approving them for the program.

    HUD must approve apartments and other rentals

    To accept Section 8, private landlords must have their apartments and other properties approved by HUD. A Section 8 renter can’t live there otherwise.

    A landlord will submit a tenancy request with HUD that includes the address of the apartments or other rental properties, projected lease start date, the tenant’s rent and any included utilities.

    Rental properties must pass an inspection

    Apartments and other rentals that accept Section 8 must pass an inspection by HUD and the local PHA.

    HUD stipulates minimum housing standards, which you must to accept Section 8. The standards focus on safety, security and the condition of the property. Private landlords must guarantee that apartments and other rentals will protect the health, safety and security of their residents.

    Section 8 authorities inspect the home once a year. Private landlords must pass inspections to continue to accept Section 8.

    Follow the lease

    Just like with any other renter, private landlords must follow the lease agreement when they accept Section 8. That means private landlords must handle repairs and maintenance, as stated in the lease.

    Section 8 renters also must comply with the lease, including paying their portion of the rent payment on time and following other rules and regulations.

    Inform HUD of rent increases

    Private landlords can raise the rent for Section 8 apartments and houses. They just need to inform their local HUD office in advance.

    However, private landlords must charge Section 8 renters the same as other renters for comparable apartments. And, they can only raise the rent once a year.

    Abide by fair housing rules

    Federal fair housing laws protect renters from discrimination when renting a home, including Section 8 rentals.

    Fair housing prohibits discrimination based on race, color, national origin, religion, sex, familial status and disability.

    what-is-fair-housing-1

    What is the most Section 8 will pay?

    The Section 8 program determines how much to pay private landlords based on several factors, including how much apartments and houses typically rent for in the area, and the PHA determines the maximum amount they’ll pay.

    The exact amount the government pays for Section 8 varies based on where the property is, but the amount is usually 90 to 110 percent of the fair market rate.

    Renters who receive Section 8 must contribute to their rent, as well. How much also varies, but it’s often 30 percent of their adjusted monthly income or 10 percent of their monthly gross income, whichever is greater.

    Renters pay their portion directly to the private landlords that accept Section 8.

    While Section 8 pays part of the rent to make finding a place to live much more affordable, it doesn’t cover everything. Renters still have to pay their security deposits.

    How to apply for Section 8 vouchers?

    To apply for Section 8, contact your local PHA office or HUD office.

    The Section 8 application process involves providing personal details, like name, Social Security number and income. The PHA will verify your monthly income with your employer and determine whether you’re eligible and the amount of Section 8 funds you’ll receive in housing assistance.

    After approval, you may get wait listed. Then, it will be time to landlords who will accept housing vouchers.

    What to know about Section 8

    Section 8 is a huge help to many renters struggling to find a place that they can afford. Under the program, the government pays a portion of your rent. You just need to find homes that accept the voucher.

    The best ways to find Section 8 rentals are to check with the PHA in your area and search sites like Rentals.com, where you can filter “income-restricted” properties. This will help you find houses and apartments that meet your family’s needs and that are well within your budget.

    Alison Bentley

    Source link

  • Is the eviction of hundreds of renters from Barrington Plaza legal? A court case to decide is now underway.

    Is the eviction of hundreds of renters from Barrington Plaza legal? A court case to decide is now underway.

    Nearly a year ago, every tenant at the massive Westside apartment complex Barrington Plaza was served with an eviction notice by their landlord, who said the residents of nearly 600 units needed to move out so the company could install fire sprinklers following two major blazes.

    In the months since, most of the tenants have left. But more than 100 stayed behind, vowing to fight in court for the right to stay in their rent-controlled units, suspecting that the owner’s real intent was to upgrade the complex and re-rent the units at market rate.

    On Wednesday, their day in court finally came as lawyers for the tenants and the owner, Douglas Emmett Inc., presented opening arguments in a civil case that will decide whether the evictions are legal. The tenants and their advocates see the case as an important test of renter protections in a city faced with an affordable housing crisis.

    “I wanted to make sure I’m represented in this fight for tenants in Los Angeles,” said Barrington tenant Chuck Martinez, who has lived in the building since 2021. “To lose this affordable housing is a step backward for L.A.”

    For the owner, the case at the Santa Monica Courthouse is about landlords having the legal right to choose not to continue renting their units. “Inside the courtroom, this is a case about upholding the law,” said John Samuel Gibson, attorney for Douglas Emmett.

    The company wants to evict the residents under the Ellis Act, which allows landlords to evict rent-stabilized tenants to remove units from the rental market — for instance, to build condos.

    The heart of the case revolves around whether the company truly intended to take the units off the rental market and whether the law requires them to do so permanently.

    Frances M. Campbell, the tenant’s attorney, said evidence presented during the trial would show that the company for years had plans to “transform and upgrade” the complex and to re-rent the apartments “at a new market rate.”

    Campbell said the law requires owners who invoke the Ellis Act to remove the units permanently from the rental market.

    “Defendants can point to no case that allows a landlord to invoke the Ellis Act to temporarily go out of the rental business while it remodels or makes repairs to its buildings. And that makes sense, because that is not the purpose of the Ellis Act,” the tenants’ lawyers wrote in a trial brief.

    The lawyer pointed to an email sent by Douglas Emmett CEO Jordan Kaplan to city housing official Mercedes Márquez in May 2023, just days before the eviction notices were filed, as evidence that the company intended to re-rent the units.

    “This project is likely to take many years and assuming we bring the rental units back online within 10 years (which is a very good assumption) they will still be subject to the RSO,” Kaplan wrote, referring to the city’s rent stabilization ordinance.

    In his arguments on behalf of Douglas Emmett, Gibson pointed to that same email as evidence that the company wasn’t trying to evade rent control.

    “I personally assure you we are not doing this to remove Barrington Plaza from the RSO,” the email said.

    Installing fire sprinklers and making other safety upgrades is a multiyear project, and the apartments will be removed from the market during that time, he said.

    The law allows owners to use the Ellis Act to “take the property off the rental market for a longterm period,” the company’s lawyers argued in a trial brief.

    The Ellis Act does not require owners to remove the properties from the rental market forever, he said. Only that they do not “conduct a sham removal” in order to evade rent control.

    “This is not one of those sham situations,” Gibson said.

    Paloma Esquivel

    Source link

  • A sign of the times: Tearing down an emptying O.C. office complex to build a warehouse

    A sign of the times: Tearing down an emptying O.C. office complex to build a warehouse

    In the hierarchy of commercial real estate, office space has long been king.

    Developers and landlords lived by the conventional wisdom that there was no better use for your square footage than business offices because they commanded higher rents than industrial spaces.

    Simple math, the thinking went.

    Well, not so simple anymore. At least in Santa Ana, where a perfectly good office complex is being demolished in a dramatic demonstration of how weak the office rental market has become and how deep the demand for Amazon-style distribution centers runs in Southern California.

    The owners of the shiny glass building on Harbor Boulevard close to John Wayne Airport made the counterintuitive calculation that they will be better off owning warehouses than trying to wrangle tenants willing to pony up for conference rooms and corner offices.

    “We had to make a strategic shift,” said Dan Broder, who is in charge of the redevelopment by Kearny Real Estate Co., owner of the property formerly known as Elevate @Harbor.

    Lagging post-pandemic occupancy rates prompted owners of the office complex formerly known as Elevate @Harbor in Santa Ana to tear it down and build a warehouse.

    (Lawrence M. Pierce)

    The shift was prompted in large part by the COVID-19 pandemic, which contributed nationwide to shrinking office populations and rising demand for home delivery of all manner of goods. Four years on, overall demand for offices remains well below pre-pandemic levels, raising questions about how many buildings built for white-collar labor still have a viable economic future.

    “There are a lot of office owners looking at their properties and wondering if those properties still make sense as offices,” said Michael Soto, Southern California research director for real estate brokerage Savills.

    Some have decided they don’t, and the result has been a shrinking inventory of offices over the last year in several U.S. markets, including Orange County, Savills said in a recent report.

    Although those in urban centers making the decision to get out of the office game increasingly have looked to convert unloved offices to apartments, in some areas warehouses are hard to come by and, consequently, bring a premium, Soto said.

    Orange County is prime territory for such switches, he said, because although it is still suburban in nature, it is densely developed with few empty sites available to build distribution centers.

    “There’s real pressure to redevelop older office buildings,” Soto said.

    The incentive to redevelop Kearny’s property was enhanced by its location in an industrial district, which spared the company from having to go through the time-consuming and challenging process of getting it rezoned for industrial use.

     An office building in Santa Ana is being demolished to make way for a distribution center.

    Demolition is underway of an office complex on Harbor Boulevard in Santa Ana that will be replaced by a distribution center.

    (Dania Maxwell/Los Angeles Times)

    It was a different world for office landlords in 2018, when Kearny bought the office campus for nearly $35 million. The landlord took over a property that was almost fully leased, Broder said. And even though a large tenant was set to move out, Kearny was unconcerned because there was every reason to expect the vacancy would be an opportunity to sign new tenants at higher rents.

    Kearny announced that it would spend about $15 million to upgrade the property into a campus-like setting with landscaped grounds, a fitness center and 24-hour access meant to appeal to tenants in creative fields such as technology. Marketing materials boasted that South Coast Plaza shopping center was nearby.

    Then came the pandemic, and by early 2022, with occupancy rates hovering at about 60% and the office rental market losing ground, Kearny started to discuss converting the property to another use, Broder said. He declined to disclose further financial aspects of the project.

    Kearny negotiated lease terminations with its tenants and set about to knock down the building that dates to 1982 and replace it with Harbor Logistics Center, a far less sleek 163,000-square-foot warehouse and distribution complex designed by SKH Architect set to be complete by the end of the year.

    It’s intended to be a “last-mile” facility, Broder said, for goods arriving from elsewhere to be distributed to the surrounding community.

    Last-mile facilities have “dramatically” increased in value in recent years and provide “solid rent growth” for their owners, the commercial real estate trade group NAIOP said, as e-commerce businesses such as Amazon compete to deliver within one day of a customer order or even on the same day it is placed.

    Frequently ordered goods can be delivered more quickly from a compact nearby warehouse than from a farther-away sprawling fulfillment center such as those found in the Inland Empire.

    Meanwhile, office rentals and on-site attendance by tenants have continued to lag in Southern California in 2023 as companies have tried to balance hybrid work policies with their desire for more employee engagement, real estate services company CBRE said in a recent report.

    The value of office buildings has been falling nationwide, with average property values down by at least 25% from a year earlier, according to a February report by real estate data provider CommercialEdge.

    Rendering of the warehouse-distribution center.

    Rendering of the less sleek 163,000-square-foot warehouse and distribution complex that will replace the office complex.

    (SKH Architect)

    “The downward trend in office valuation is more pronounced in older and less ideally located buildings,” the report said, perhaps such as the aging campus Kearny is knocking down.

    “This is not a one-off,” Soto said of the landlord’s switch from office to industrial use of its property. “Especially in dense suburban markets like Orange County where land is expensive, we are going to see more of this.”

    Roger Vincent

    Source link