Supervisors approve condo legislation with veto-proof majority

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Tenant supporters lined the hall wearing stickers that said, "Stop Evictions. Save Rent Control Housing. Support the Compromise.
Steven T. Jones

The San Francisco Board of Supervisors today voted to approve compromise legislation that will allow more than 2,000 tenancy-in-common homeowners to convert to condominiums in exchange for a 10-year moratorium on the city’s current condo conversion lottery that now allows 200 conversions annually.

Approved by a veto-proof 8-3 majority after some last amendments were shot down by the six supervisors who most steadfastly supported the version that Board President David Chiu took the lead on crafting, this was a big victory for tenant groups who strongly opposed the original legislation, which did not include the moratorium and other restrictions.

“It’s great. We’re going to see a significant drop in condo conversions in the future. All of us tenants are very happy,” San Francisco Tenants Union head Ted Gullicksen told us after the hearing, which was packed with tenant supporters.

Sup. Mark Farrell, who sponsored the original legislation, decried how divisive the issue had become, criticized the approved version as deviating from his original intent of helping TIC owners in exchange for a fee that would help fund new affordable housing, and said, “This doesn’t need to be a zero sum game.”

But Chiu and the five supervisors who supported his version – Jane Kim, Norman Yee, David Campos John Avalos, and Eric Mar – noted the finite number of rent-controlled apartments in the city and the need to protect them from being converted into condos.

“How do we balance the needs of tenants who fear being evicted with TIC owners looking for relief?” Chiu said of the balance he aimed to strike, which he continued to tweak with new amendments today, including allowing TICs with all owner-occupied units to move forward if the legislation is challenged in court, an event that would otherwise freeze all condo conversions until the lawsuit is resolved.

Sup. London Breed wanted even greater flexibility in that so-called “poison pill” aspect of the legislation, which tenant groups had insisted on to prevent the bypass from going through even if the moratorium was challenged. Breed proposed allowing condo conversion applications to proceed for a year after a lawsuit was filed, but Chiu said that would let TIC owners convert to condos while challenging other aspects of the legislation, such as the lifetime leases for tenants in converted buildings.

Breed and Sup. Malia Cohen, who privately and rather grimly conferred with one another and sometimes Chiu before the item began a little after 4pm, were clearly the two swing votes on the question of whether the legislation would reach the crucial eight-vote threshold needed to override a possible mayoral veto. Mayor Ed Lee has refused to take a position on the issue, leaving both sides in the dark.

But after the motion to insert Breed’s amendments failed on a 5-6 vote, the board voted 8-3 to approve Chiu’s version of the legislation, with Sups. Farrell, Scott Wiener, and Katy Tang opposed. A subsequent vote on a version of the legislation backed by Farrell and Wiener – which contained a weaker poison pill and more flexible owner-occupancy provisions – then failed on a 4-7 vote, with Breed joining the three dissenting supervisors.

Underscoring this legislation was what some supervisors called a “housing affordability crisis” in San Francisco, an issue that Mayor Lee was asked about at the start of the meeting, which he deflected by claiming “our city has some of the toughest anti-displacement laws in the nation.”

We’ll analyze that discussion and offer more details on the condo conversion debate and the politics behind it tomorrow in the space, so check back then.      

Comments

But hey, TIC owners get to immediately condo and every other landlord, knowing that future lotteries are decades away, will simply Ellis, TIC and cash out.

How this is good for tenants totally defeats me but whatever.

Posted by Guest on Jun. 11, 2013 @ 6:34 pm

A future Board will likely remove the restriction that Ellis'ed building cannot condo convert.

Posted by Guest on Jun. 11, 2013 @ 7:55 pm

By a vote of 8-3 the supervisors have shut down the condo corversion process for the next few years. The vote included Supervisors Cohen and Breed, who are not known to be the most rabid tenant supporters.

Politics is always about the future. Of the most important city politicians who can actually affect public policy it seems Mayor Lee, Assessor Chu, DA Gascon and Supes Weiner, Farrell and Chu are on one side, with Supervisors Chiu, Mar, Avalos, Campos, Yee and Kim on the other. Supervisors Breed and Cohen seem mostly somewhere in the middle. One side currently holds much of the policy and budget power, but the other side has youth, intelligence and still seem to retain a bit of idealism for a more hopeful world. Willie Brown will be gone and the rich will be richer than ever and the lower and middle income groups will be even more economically marginalized. Get back to us in six years and let us know how the condo conversion process is going for Ellised units since I think the city you're hoping for will be farther out of your reach than it is now.

The biggest message I heard from the supervisor's 8-3 vote - a message that was written on these comment boards a few times - is what was stated in the article above, "[The supervisors] noted the finite number of rent-controlled apartments in the city and the need to protect them from being converted into condos."

Although I suspect many real estate agents will tell prospective TIC buyers there is "always a possibility" of future condo conversion - since real esate agents are always willing to prevaricate if there's money to be made on a sale - let's hope any future TIC buyers sue their agents when they subsequently learn that the condo conversion door is closed for good. Better yet, the city should require a statement at every TIC sale closing: "This unit was subject to an Ellis eviction and WILL NOT QUALIFY for a condo conversion."

Posted by Guest on Jun. 11, 2013 @ 8:33 pm

2200+ new condos will be approved - that's the real message. It's amazing that tenant "advocates" have allowed this to happen.

Posted by Guest on Jun. 11, 2013 @ 9:14 pm

The dozens of whiney, entitled TIC owners that show up at city hall to complain about their 1% higher interst rate and balloon mortgages are now gone from the political picture. Plan C, Mayor Lee and Supes Weiner and Farrell have accomplished their goals to convert a large chuck of rent-controlled units to condos, but it was at maximun cost to their future constituency of predatory TIC flippers and wanna-be homeowners.

But the real beauty of this legislation, as you well know, is that this issue doesn't have to be addressed for the next decade while local politicians and tenant advoctates work at the state level to get the Ellis Act and condo mapping laws changed.

David Chiu, tenant advocates and many others took a bad piece of legislation and solved many problems all at once while giving themselves some breathing room. There's still much work to be done with regards to SF housing policies, such as a better understanding of the demographics buying all of the new housing being built over the past 20 years, and why the Planning Department is only allowing multi-million dollar condos to be built, but for now the whiney, bratty TIC owners have got what they want and can go away to whine and complain about their miserable lives to their co-workers and family members and leave the rest of us alone. Good riddance.

Posted by Guest on Jun. 11, 2013 @ 9:51 pm

It will be very interesting to see how this cat and mouse game plays out. My bet is on the cat. The city demographic is shifting toward people wanting to own, not rent.

Posted by Guest on Jun. 11, 2013 @ 10:26 pm

but thousands of units will now become condo's and, worse, existing rental building owners will have to wait so long to go condo now that they will simply Ellis.

There is zero chance of Ellis being repealed because it was an Act passed simply to align the statutes with a constitutional issue that the courts had already decided i.e. that a landlord cannot be forced to rent out his units.

Posted by anon on Jun. 12, 2013 @ 5:52 am

Sounds like you're pissing away your beer money.

Posted by Harry Muff on Aug. 17, 2013 @ 1:39 pm

"- let's hope any future TIC buyers sue their agents when they subsequently learn that the condo conversion door is closed for good. Better yet, the city should require a statement at every TIC sale closing: "This unit was subject to an Ellis eviction and WILL NOT QUALIFY for a condo conversion."

Actually the reason all those screaming broke TIC investors don't sue the broker now is because it is all fully disclosed. They are totally in on the scam. Ok? Get it?

TICs in this city are speculative plays on a windfall condo conversion. That is all they are. Without the condo conversion, these TICs become unsellable.

It is a total scam.

Posted by Guest on Jun. 11, 2013 @ 9:15 pm

TICs meet a need. Many people don't want to be tenants and would much rather own their own place. Private landlording is a patriarchal, adversarial, despicable system destined for the dustbin of history one day. If TICs are one of the few options I have to purchase a unit to live free from a greedy, patriarchal landlord, then I'm going to pursue it as a housing option. I may not like it compared to a condo or single-family home, but there aren't a lot of good options here. Some of us will take a TIC with all of its ownership flaws over a similarly priced condo or single-family home outside the city.

Not everyone will go for a TIC, that's true. But when you're talking about tens of thousands of people who would like to buy a place in SF, with TICs one of the few more affordable options, it only takes a percentage of those potential buyers to create a thriving market for TICs. When owners of apartment buildings die their heirs often sell the building since they don't have to pay any capital gains tax. For 2-6 unit buildings I'd expect most will be sold to TIC converters since they can make a quick million or two from the TIC conversion. It's simple predatory economics, American Style.

Two of SF's prominent progressives - Ross Mirkarimi and Alix Rosenthal, along with many others who fashion themselves as progressives - both bought former rent-controlled units. If the progressives have no problem doing it, even the Bay Guardian and its most ardent supportes can't expect the rest of us to deny ourselves of buying a former rent-controlled apartment even if it's a less than perfect ownership structure such as a TIC.

Posted by Guest on Jun. 11, 2013 @ 10:09 pm

ownership in SF and are becoming more mainstream, as we can see from the growth of fractional mortgages.

Moreover, the co-op system of home ownership in NYC is similar to tIC's and is very well established there. In fact it's the norm.

And whatever you think of TIC's, the fact is that they are better than renting. And if both a property owner AND tenants think that TIC's are better than renting, then we will see more TIC formations, either through negotiated sales between owners and tenants, or of course via Ellis.

Posted by anon on Jun. 12, 2013 @ 5:55 am

You post this every time this topic comes up but it still makes absolutely no sense. It assumes that every single LL in the City simply want to turn their building into condos and are simply waiting for all their tenants to die off/leave so that they can.

People who want a steady stream of income are landlords (its a pretty good place to be one despite what some say). People who don't want to be landlords anymore Ellis and cash out. I know you will simply disagree with this, but the anecdotal evidence I have through landlords I know doesn't back up your characterization.

Posted by Guest on Jun. 11, 2013 @ 9:09 pm

be in SF. A SF LL can Ellis his SF rental building, sell, and then buy a rental building in a neighboring county without all the hassles, constraints and risks of rent control.

The freedom and flexibility to simply be able to tell a tenant to leave and he leaves within 60 days is probably worth quite a few basis points of ROI.

Posted by anon on Jun. 12, 2013 @ 5:58 am

"...every other landlord, knowing that future lotteries are decades away, will simply Ellis, TIC and cash out."

Not really. Without the provision for condo conversion, the TIC market is dead.

TICs have nothing to do with housing for the middle class. They are a real estate game and nothing more.

Posted by Guest on Jun. 11, 2013 @ 9:09 pm

It will be interesting to see what happens to the TIC market. Will prices go down significantly? Will the fractional loan model improve, making condo conversion less critical? What happens to all the existing TICs that were not in the lottery?

Posted by Guest on Jun. 11, 2013 @ 9:34 pm

Any and all TIC's are easily selling right now because demand for home ownership easily outstrips supply. In fact home prices are up 12% in the last year - a nice little tax-free return for those who took a risk.

If we have another bust then TIC's may suffer more than most but as long as you can pay your mortgage, why would you ever need to sell?

Meanwhile demographic changes make it likely that at some point rent control will be rolled back and the condo process will be made easier.

Posted by Guest on Jun. 12, 2013 @ 6:04 am

There are already a few thousand TICs in the city, with some of those in 6+ unit buildings that can never condo convert. It's not the best form of ownership, but TICs are some of the few ownership unis available to thousands of people who want to own a residence and either can't afford a comparable condo or because there aren't many condos for sale at their price range.

I haven't read the most current legislation passed today, but if they prevent 5-6 unit buildings from being condoized altogether, then that will put even more pressure on on 2-4 unit buildings since there are literally thousands of people looking every day to buy a place and 2-4 unit buildings are the easiest for TIC conversions since they take less money to purchase than larger buildings and it's possible they'll be allowed to condo convert in future decades.

New York City has co-ops for historical reasons and SF will always have TICs for historical reasons. As TICs get a longer track record and most of the risks of TIC ownership diminish, more banks will provide financing, TIC agreements will become more standandized, and people will become even more comfortable with them. This will encourage additional waves of TIC conversions.

Make no mistake. If tenants live in a 2-4 unit building, or even a 5-8 unit building, there's a very good chance their apartment will be turned into a TIC one day. It's simple economics. A rent-controlled unit might be worth $2-300,000 whereas the same unit as a TIC might be worth $5-750,000. So of course most people who sell a building will sell them as TICs, or at least the new buyer will. There's far too much unmet demand for ownership housing in the city and virtually zero supply. TICs are a logical outcome of current supply-demand dynamics.

Since the city is only building housing for multi-millionaires, middle income families earning up to 150% of AMI have few places to turn other than TICs. It shouldn't surprise us if there are thousands more of new TICs ten years from now even if most of them won't qualify for condo conversion under the current rules.

Posted by Guest on Jun. 11, 2013 @ 9:38 pm

In NYC there are relatively few condo's, and even multi-millionaire celebrities live in co-op's.

All that is required is to overlay a corporate structure over a TIC and then sell shares in it. That isn't something the city could prevent as it is allowed by State law.

Usually it is not worthwhile for smaller numbers of units but, if it makes TIC's more viable, then it will happen. Instead of Ellis/TIC it will be Ellis/Incorporate/ TIC.

Posted by Guest on Jun. 12, 2013 @ 6:08 am

TIC units that can never enter the condo lottery are very unattractive. Units are worth at least $100k than condo eligible ones, interest rates are much higher than for condos, and currently only Sterling Bank in the Bay Area will even finance TIC's that can't become condos.
With rents sky hi few landlords will want to evict renters, and few home buyers will want to buy a TIC they can never convert to a condo.

Posted by Guest on Jun. 22, 2013 @ 10:39 am

hope of an eventual condo conversion if and when you get natural vacancies or for-cause evictions.

With that avenue now closed for maybe 15 years, there is no reason not to Ellis. Might as well Ellis, TIC, sell and move onto the enxt project.

I confidently predict MORE Ellis/TIC conversions even while as have LESS condo's. The tenants folks did not think this through.

Posted by Guest on Jun. 22, 2013 @ 10:58 am

The Board has no say or sway over that wonderful piece of legislation!

Posted by Lucretia Snapples on Jun. 11, 2013 @ 7:00 pm

any incentive to wait for a possible condo conversion, because that is now too far in the future.

Both sides have scored own goals here. Property owners not getting a bypass will have to wait forever to condo, while more tenants will lose their home as owners simply Ellis and move on.

IOW, a typical San Francisco piece of legislation where (almost) everyone loses.

Posted by Guest on Jun. 11, 2013 @ 7:27 pm

The new conversion fee will ensure they can continue their dismal record of NOT providing affordable housing to their clients for another decade at least!!

Posted by Lucretia Snapples on Jun. 11, 2013 @ 8:04 pm

How true, I have lost my future investment. My 200,000 a year wage earning tenant wont sign the quitclaim Long life waiver unless I pay him 100,000 dollars. So I can't convert and sell the condo for income when I get old. As an Artist, it was a way to take care of myself when I got old. After living in the City for 30 years many of those as a tenant, I am heartbroken that the city has turned its back on small property owners who have rental units.
Now I see that finding a Rent Controlled apartment is a windfall financially. You can in the end, get your income supplemented, and possibly get a down payment for your new house. OR at least have money in the bank. LOTS of money in the bank. Thanks SF! Job well done. Cheers.

Posted by Guest on Nov. 26, 2013 @ 12:32 pm

The rent-controlled units I had are all either TIC'ed and sold, or are rented out short-term on corporate, academic or tourist lets.

Rent control hurts affordable housing.

Posted by anon on Nov. 26, 2013 @ 12:41 pm

Congratulations to the 2000 TIC owners who can now condo convert!

Posted by Guest on Jun. 11, 2013 @ 7:53 pm

Supervisor Farrell is from the business community, He knows, better than most, that our economic system is absolutely based on a "zero sum game," especially landlording. My goal as a business owner is to extract as much profit from my customers and to take as much market share from my competitors, just as my competitors are doing the same.

As a landlord my job is to extract as much wealth out of the building as possible, by charging the highest rent price anyone in the community can afford to pay me and by selling buildings at an opportune time to extract as much capital gain as possible. I don't want to hear tenant sob stories about how much money they are spending on rent or how little maintenance I do for the property. If they don't like it, they can leave since there are hundreds of other tenants lined up to pay me even more money in rent.

Mark Farrell (and Scott Weiner) belie their true motives when they talk about avoiding a "zero-sum game" since the entire business model of landlording is a zero-sum game. Landlords aren't in the charity business. Their goal is to get as much rent as possible - tenants and their whiney families be damned. Tenants have always been the lowest form of humans in most countries and they aren't treated much better in the US either. Property owners are always at the table when constitutions are being drawn and laws are being passed, whereas tenant supporters are most often relegated across the street to the protest line.

This 8-3 vote by the supevisors is historic. It sends a clear message to landlords and speculators that the easy path to tenant evictions and condo conversions is over for the next few years. In the meantime, supervisors, tenant groups and housing activists need to find a way to build new housing affordable to the thousands of middle-income tenants who will be evicted one day via Ellis and OMIs, along with building new housing for the tens of thousands of current tenant residents who want secure and moderately affordable housing that isn't owned and controlled by third-party landlords.

Landlording is a pernicious and vile insttution, akin to slavery. San Francisco should be leading the way to repeal the landlording institution from human history forever. Short-term housing needed for students and short-term residents should be owned and controlled by non-profits who have far more restrictions on their rent gouging behavior and speculation incentives compared to a profit motivated private landlord. But for 95% of tenants who just want a safe and secure home, the for-profit landlording institution needs to be terminated sooner rather than later. It degrades humans and can destroy families.

What's most exciting about the legislation is that Supervisors Ferrell and Weiner were attempting to clear the bases of 2,000 TICs to make them condos, while setting up another wave of tenant evicitons, TICs and condo conversions over the next few years. Supervisor Chiu, tenant groups, and other politicians and activists who took the mean-spiritied Ferrell and Wiener legislation and tunred it into a positive outcome should be applauded, fetted and honored for years to come. In one brilliant stroke their gambit takes away the constant whining of Plan C evictors and speculators, and it quiets a number of TIC owner/speculators who are always complaining about higher interest rates or awkward transaction costs associated with a TIC (but never mentioning the lower property tax or purchase price they got from buying a TIC over a condo). And importantly, the legislation takes the eviction -> TIC -> condo path away from predatory speculators for the next few years. Yes, many buildings will still be Ellised with many more tenants being evicited, but selling TICs with little chance of condo conversion is far less profitable than selling TICs with a clear, albeit long, path to condo conversion.

I especially applaud Supervisors Breed and Cohen for supporting the legislation. It may not be what they would have drafted or what they think is absolutely best for the city, but they had the courage and foresight to choose the better alternative offered to give the city a break for a few years from the devastating and hateful eviction->TIC->condo routine. Hopefully they can help lead the way to creating ways for San Francisco to build tens of thousands of permanently non-speculative ownership housing units for the tens of thousands of families who desparately want out of the hateful, vile, and yes, "zero-sum" housing landlord-tenant game that prevents the city's population from reaching its full potential.

Posted by Guest on Jun. 11, 2013 @ 8:04 pm

And there isn't a sweet damn thing you can do about it.

Posted by Guest on Jun. 11, 2013 @ 8:19 pm

Get real. Everything done in the name of tenants ends up producing the exact opposite outcome.

Posted by Guest on Jun. 11, 2013 @ 8:34 pm

Rents are probably ten times now what they were then.

Landlords refuse to maintain their units if they have low rent tenants.

No new RC units are being created, but thousands are lost each year due to Ellis, OMI, TIC, condo's etc.

There are estimated to be 10,000 units left vacant just because of rent control

LL-TT relationships are at an all-time low.

Tenants with low rents tend to get Ellis'ed.

Many tenants with RC make 100K or more a year, while many poor tenants have to pay market rent

Rent control causes people to "squat" on units, denying homes to new arrivals.

How can any tenants claim this is a success?

Posted by Guest on Jun. 12, 2013 @ 12:28 pm

"Landlording is a pernicious and vile insttution, akin to slavery." I think you should personally congratulate Supervisors Breed and Cohen and share with them that nugget of wisdom.

Posted by Guest on Jun. 11, 2013 @ 8:39 pm

Any political opinion that a reader disagrees with is immediately dismissed as "Nazi" or "like slavery".

Funny thing is, last time I checked, rental leases were entered into voluntarily by both parties. And the tenant can leave at any time while it is the landlord who cannot end the lease.

So it is a little like slavery after all, because it is one-sided.

Posted by Guest on Jun. 12, 2013 @ 9:53 am

How do tens of thousands of affordable housing units suddenly appear in the city when the costs of construction are so high and the amount of available space is so limited?

Posted by Guest on Jun. 11, 2013 @ 8:41 pm

The city planners have told us they can add a couple hundred thousand more housing units to the city over the next few decades. By adding a zoning designation, "Workforce Housing" that requires the sale of units to discrete population segments earning 80% to 150% of AMI, with permanent restrictions (99 years anyway) to the same income segments when the units are sold will create tens of thousands of permanently affordable ownership housing units. This designation could apply up to 60% of the total units built over a certain height limit (say 2 stories.)

The mayor and city planners have been giving away billions of dollars worth of height and density up-zonings for the past few decades with little or no corresponding increase in the affordability of the units. Since there are hundreds of thousands of millionaires around the world that would love to buy a nice pied-a-terre in the city, the only way to prevent SPUR, the mayor, the "city family," property speculators and developers from building units for sale for these mostly non-resident multi-millionaires is to designate the vast majority of newly built housing units as "workforce housing" that are restricted to full-time residents who fall within middle and lower income categories.

Posted by Guest on Jun. 11, 2013 @ 9:03 pm

identify who is going to pay the full cost of those homes because it certainly will not be the people living here.

No, the real solution is to build high - the only way to build cheap when land is expensive.

Posted by Guest on Jun. 12, 2013 @ 9:54 am

I love the rent control driven crisis - makes property value sky high.
Where else can you get 16X GRM?
I wouldn't be surprised if Ted Gullicksen is a major property owner in SF.
This move just added 10% to condo prices. You don't think that's going to affect the rent prices?

Posted by davantage on Jun. 11, 2013 @ 8:09 pm

being less new condo's coming on stream.

Ted just made me some money.

Posted by anon on Jun. 11, 2013 @ 8:20 pm

Why would allowing 2,000 TICs to become condos increase condo prices 10%? It seems to me that this would have the opposite effect since the supply of SF condos will greatly increase. Each of the 2,000 TIC owners will, for $20,000, now be able to increase the value of their units by at least $100,000, though. Bully for them.

Posted by Confused on Jun. 11, 2013 @ 8:34 pm

they probably still cannot afford the next rung on the housing ladder.

These 2,200 new units only affect RE prices if they add to the liquidity, and I do not think they will.

Posted by Guest on Jun. 12, 2013 @ 9:56 am

The city should take a hint from Margaret Thatcher's playbook and privatize the remaining housing projects. That would mean more housing on the market and thus boost supply, lowering prices.

Posted by True liberal on Jun. 11, 2013 @ 9:48 pm

also rolled back what was (at the time) a national system of rent control.

Oh, and she also changed the UK property tax system so that tenants paid it rather than the property owner - a system which is still in effect today. Makes sense since it is tenants who are consuming local services.

We could learn a lot from that.

Posted by Guest on Jun. 12, 2013 @ 6:02 am

i've lived in san francisco for almost sixty years now and seriously people things need to change. we need a new paradigm. i admire albert einstein who said "problems cannot be solved by the same level of thinking that created them." so we can just get rid of ted gullicksen, whose been the head of the tenants union since at least 1988. personally, i'm just sick of hearing his name. i mean if in 25 years he hasn't been able to stem the housing crisis, then it's time for him to retire and give the reins to someone new, someone young. personally, i think all the people who continue to put politicians who label themselves "progressives" like david compost and john at-a-loss in office just keep shooting themselves in the foot. but what do i know, i've only lived in this city for 58 years and i have a home. if you continue to believe compos, guillicksen and avalos care about your housing, then you deserve what you get!

Posted by Guest on Jun. 11, 2013 @ 10:27 pm

that is all they know how to do. I mean, seriously, what other job could Gullicksen possibly do? What other city would have Avalos or Campos as an elected official. These people are unemployable and yet, in SF, they can survive, if not flourish.

They don't care about tenants or the homeless at all. they care about themselves and their survival.

Posted by anon on Jun. 12, 2013 @ 6:00 am

of unintended consequences!

Holy moly, this is San Francisco at it's finest, lol. Seriously, unbelievable.

Now, I don't get expect any of the tenant's rights activists to actually understand this - because they are dumber than a box of shit and don't seem to possess this really great thing called foresight - but here is what is guaranteed:

**GET READY FOR THE MASSIVE WAVE OF ELLIS ACT EVICTIONS**

You stupid, stupid, fucks, lol. So here's what's up... The poison pill halts all current conversions while the legislation halts any future conversions. There is no way somebody won't file suit, triggering the poison pill, fyi. So basically, condo conversion is done. That means all those 2-4 unit building owners who played by the rules, who never Ellis acted, never displaced, never rented out their unit to fulfill ownership requirements = SCREWED. They get the **exact same treatment** as the slum lord who Ellises an 18 unit rent controlled building, kicks all the tenants out (longterm, old, disabled, sick, whatever..) and sells the units off as a TICs.

THERE IS LITERALLY NO INCENTIVE NOT TO EVICT THE FUCK OUTTA EVERYONE.

The prospect of condo conversion eligibility was what kept thousands of property owners from booting out long-term tenants. And now that prospect is GONE.

So, so awesome. San Francisco unintended consequences at it's finest!!!

Posted by Scram on Jun. 12, 2013 @ 10:49 am

courts. That has Gullicksen written all over it - he has tried those clauses before and they've been rejected. It's really dumb.

but you are right this will lead to a wave of Ellis evictions. Why? Because the lottery for new condo conversions probably will not start again until 2024. Given the backlog by then, it could be 2035 before units that don't make this bypass will be condo'ed.

For all practical purposes, that's a lifetime. so why play by the rules if you have to wait that long? Instead why not just Ellis, TIC and sell? No brainer.

Posted by Guest on Jun. 12, 2013 @ 11:04 am

This legislation actually helps with my decision to Ellis my 6 unit property filled with long termers. On many levels it comes as a relief.

Posted by Guest on Jun. 12, 2013 @ 12:02 pm

for up to 20 years would lead directly to more Ellis evictions?

If you have no chance of a condo anyway, there is no downside to an Ellis.

Posted by Guest on Jun. 12, 2013 @ 12:14 pm

Just like a person who is culture bound this guy is so ideologically bound he doesn't even realize the ramifications of his tirades and collusion with the criminal politicians. Sure wouldn't want him advocating for me. Poison pill likely to be struck down by courts while Ellis evics will become increasingly common. Typical unemployed, unemployable and uneducated advocate thinking.

Posted by Guest on Jun. 14, 2013 @ 3:50 pm

are now seriously thinking of Ellis'ing their SF building and re-investing in Marin, where there is no rent control and where rents are almost as high.

These new condo restrictions leave them with no other exit strategy. And a vacant unit as a TIS is worth about 100K more than a rented unit under rent control.

No brainer.

Posted by Guest on Jun. 14, 2013 @ 4:05 pm

I suspect many LL's will now see no reason to wait for a condo.

And while the city can do nothing to prevent Ellis evictions, there could be a backlash if 1,000 or so Ellis evictions go through in the next 18 months, and it's just possible that the State may do something. I doubt Ellis will be repealed but it could be amended, maybe with longer waiting periods, or a temporary moratorium imposed.

So better to beat the rush as it could be "use it or lose it" with Ellis. You want to be one of those 1,000.

Posted by anon on Jun. 14, 2013 @ 8:58 am

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