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Sherman Oaks, CA 91423

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October 16, 2009

Victory for Tenants & Affordable Housing
104-Unit Rent Controlled Apartment
Complex Denied Condo Conversion Approval

Tenants of a 104-unit Sherman Oaks apartment complex celebrate another victory as they leave the LA City Council Chambers after a Council vote to denial the condo conversion of their building, resulting in the saving of their homes. (Photo – from left to right: Neighborhood Legal Services Attorney Jennifer Phen, Tenants: John Pantazis, Barbara Saget, Saul Saget, Teresa Gallego, Marla Joseph & Ross Thorne)

Los Angeles City Council President Eric Garcetti called out, “Open the roll.” The City Clerk followed with, “13 Ayes, Zero Nos.” And, with that the LA City Council unanimously voted to uphold the recommendation to deny a condominium conversion application of the 104-unit rent controlled Grand Villas Apartments (formerly Magnolia Park Apartments) in Sherman Oaks. The ecstatic tenants who were present filed out of the City Council Chambers to celebrate.

The October 13, 2009 City Council vote marked the end of another chapter in an over decade-old fight with four different landlords to stop tenants from being displaced, and to prevent this affordable housing from being lost.

Tenants Win Tough Battles

During this time, the tenants fought and won other landlords’ attempts to evict them and/or raise their rents. The battles have been over a previous condo conversion attempt, major rehabilitation evictions, capital improvement rent pass-throughs, reduction of services and environmental health hazards.

The tenants’ commitment and determination has outlasted three other owners who ended up selling the property in frustration, as a result of not being able to displace tenants and increase rents.

During the years, tenants have received tireless and important legal representation from the Neighborhood Legal Services of LA County, as well as the full support of the Coalition for Economic Survival.

New Owner, Same Intent

The current owner, Brian Dror, is a notorious developer/speculator: He buys numerous apartments in L.A., which he then converts, displaces tenants and pockets large profits. He began his quest to convert the building to condos about two years ago.

In December 2007, Dror’s original condo conversion application before the LA Planning Department’s Area Advisory Agency was denied due to problems with the required tenant notices. As he left that hearing, he made a call on his cell phone and in a voice loud enough for tenants attending the hearing to hear, he spitefully told the person he called to prepare the eviction notices. Luckily, he never followed through with it. But he did re-file the condo conversion application.

Another Flawed Condo Conversion Application

The new application he filed had even more problems. The City’s findings included that the vacancy rate of the Planning Area was less than 5% and the proposed conversion would have a significant cumulative effect on the rental housing market. This alone provides the City the ability to deny a condo conversion. There were also problems with tenant notices required under the Subdivision Map Act. The developer failed to survey how many people were willing and able to purchase the converted units. Also, 63% of 104 unit households signed statements that they were unwilling and unable to afford the new condo units.  Further, the conversion would increase the loss of rent controlled units in that zip code by over 66%.

In addition, shortly before one of the prior Planning Department hearings, the building on-site manager distributed a notice to tenants, suggesting that, in fact, no action was underfoot to convert the apartments to condos. The effect of the notice invalidated the required 60-day Intent to Convert Notices and was seen as a blatant attempt to chill public participation in the process.

Tenants Will Stay Vigilant

While this is a significant victory, the tenants have come to realize that the developer will probably not give up. And, if he does, there will probably be another owner who will attempt to displace them. But, as has been the case in the past, the tenants are ready and willing to continue to fight to save their homes.

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