The Los Angeles City Council Friday is expected to vote on an almost $15 million deal to aid Chinatown apartment building tenants who have been fighting rent hikes since 2020.
If approved by council members, the 10-year deal will require the city to spend almost $15 million to provide subsidies for dozens of units at the property known as the Hillside Villa Apartments, a 124-unit building constructed in 1989. The proposal came out of negotiations between the Los Angeles Housing Department and the landlord, 636 NHP.
As part of the agreement, Councilwoman Eunisses Hernandez, who represents the First District, which includes Chinatown, was able to secure a six-month extension for tenants before a six-year repayment period is set to begin.
The complex was built using funds from the Community Redevelopment Agency of the City of Los Angeles, and the city, with a 30-year covenant restricting the units to affordable rents.
The covenant expired in 2019, and notices were given to tenants that rents would be increased to market value. According to tenants, they’ve faced rent hikes up to 300%.
Of the 124 units, 106 would be covered by the deal, and the building has 68 units designated for low-income households, using Section 8 rental vouchers to help those tenants pay rent.
The property owner has refused to sell the building to the city, citing that redevelopment of the site will be an opportunity when the building ages, Ann Sewill, housing department’s general manager, previously said. The building was developed on a zone that would allow for double the number of units.
“In lieu of a purchase and sale agreement, LAHD and the owner have negotiated a new covenant agreement that extends the affordable rent term for 15 years and two months, provides a longer repayment term for tenants that owe back rent for the period between 2019 and 2024, and gives the city a first right of refusal to purchase the site if the owner decides to sell any time before February 2037,” according to city documents.
In addition the city is offering the property owner an extension on existing loans, totaling $5 million, at 0% and 1% interest.
Thomas Botz, the managing member of 636 NHP, told the Los Angeles Times that the deal “speaks for itself.” He added, “I hope the tenants appreciate what Ann Sewill is doing for them and the city, and will not be led by the (tenant) organizers.”
Tenants at Hillside Villa have criticized the deal, saying on social media there is a provision allowing the eviction of renters who fail to pay back rent owed from the coronavirus pandemic.
“We have to make monthly payments — on average over $500 — and our payments get applied to the debt first,” the Hillside Villa Tenants Association wrote on social media Monday. “If someone can only afford the previous rent and pays every month, they are still subject to eviction.”
According to tenants, there are currently 35 of them who are facing eviction. They are calling on city leaders to make a new deal that would clear tenants of their back rent and prevent the landlord from evicting them.
Residents have called on city leaders to use eminent domain to acquire the building. Sewill said that would not be feasible as it would cost the city $800,000 per unit based on current interest rates, operating costs and efforts to rehabilitate the building.
The deal was approved by the council’s Housing and Homelessness Committee Wednesday.