Three Westlake area apartment buildings involved in a high-profile rent strike last year have sold for $48.25 million to a private real estate investor.
The orange and yellow complexes that hold a combined 192 units were purchased by 29th Street Capital, a real estate investment company based out of Chicago, in a deal brokered by Transwestern Commercial Services.
A spokesperson for Transwestern declined to name the buyer, but public records show the new owner is “29SC Burlington LP,” a limited partnership company registered by 29th Street Capital in September.
“This is 29SC’s first acquisition in the greater Los Angeles-area,” says the company’s online portfolio under a photo of the Burlington buildings.
Jason De Guzman, the company’s project acquisition manager, did not respond to requests for comment.
29th Street Capital has contracted the help of Sunrise Management, a building management company based out of San Diego that also oversees the 22-story 8th and Hope apartment building in Downtown Los Angeles.
The transaction came as a surprise to the tenants of 131, 143 and 171 Burlington Avenue, who have still not been formally told the buildings have been sold, according to multiple tenants. Still dealing with lawsuits from their 2018 rent strike, the move has launched them into a further state of uncertainty as the new building managers slowly unroll new details.
On Tuesday, all tenants of 143 Burlington Avnuee were informed that some units would undergo a remodel and were given a 30 to 60-day notice to either move out of the apartment, or find other accommodations and come back once the remodel is made, according to memos posted on their doors.
“I spoke to the new manager and she told me there was going to be changes and that they were going to fix all of the buildings,” Burlington tenant Luis Herrera said, speaking in Spanish. “She said they are going to paint them, install grills for cooking outside, and a bunch of other fixes.”
Herrera, who pays $1,300 for a one bedroom, says he was told his rent would be raised to $1,900 after the remodel and the rent for two-bedroom apartments would increase to around $2,400.
Many tenants who are now representing themselves in court are expecting to learn their fate at a hearing scheduled for October 10 as part of an ongoing legal battle with the previous managers, FML Management.
Sunrise Management, Lisa Ehrlich, the former owner of the Burlington complex, and representatives of FML Management did not respond to requests for comment.
The tenants, known as the Burlington Unidos, formed a rent strike in the spring of 2018 with the help of the Los Angeles Tenants Union after claiming they were living in mold and rodent infested buildings. Videos taken by the tenants showed leaking sewage pipes and mold growing on walls. While juries in some of the cases decided in favor of the tenants-turned-activists, others lost their case, and close to half of the Burlington Unidos left the apartment complex.
Those remaining are now in talks to reorganize and stage another rent strike.
“They want to fight this,” says Trinidad Ruiz, an organizer with LATU who has been working with the tenants for more than a year. “ They want some sort of legal advice and that’s what we’re trying to find them.”
Ruiz said they might have a fighting chance if Gov. Gavin Newsom signs Assembly Bill 1482, which would regulate rent increases, and if the tenants find a lawyer who can use the bill to their advantage.
“There is some language in the law to maybe fight back with, and we’re looking at some of that language,” Ruiz says.
Comments
In related news, 29th Street Capital just made a large donation to Governor Gavin Newsom. Wink, wink.
By LADude on 10.03.19 9:58am
A $600 increase is not feasible for most people. It’s great that they want to remodel the units, but it’s all just to kick the tenants out and get more money. I hope the building management company provided some sort of help to the tenants to find somewhere to live, while they renovate. I know most people on this site, won’t actually agree with me but giving someone 30 days to find somewhere else to live abruptly and jacking their rent up $600 isn’t right.
By ewilliams1911 on 10.03.19 10:11am
These absentee landlords are the cause of so much suffering. They ignore their properties and never raise rents, until one day they realize they are all falling apart and rents are well below-market. Then they decide to remodel everything all at once and raise rents enough to basically kick everybody out in one fell swoop.
Whereas, if the building were properly managed. Units would be updated on a rolling basis and rents consistently raised.
If you want to own a building and not spend time running it, don’t be shocked when you’re horrible plan to fix it makes you look like a complete villain.
By Greyvagabond on 10.03.19 10:45am
"they never raise rents" Not true. I’ve never lived in an apartment for multiple years where the rent did not go up. At best the landlord would skip a year.
By Jason Michael Saunders on 10.03.19 11:26am
I guess you never owned a large apartment building. To upgrade plumbing you have to open walls to get to the pipes that are in the walls and transport water from the top levels to the bottom. You have to cut off people’s water all day. Most real upgrades you can’t do with tenants living in the units. Noise, dust, disturbance etc make it not feasible. The work, plus permits, inspections etc can take months. When you have long term tenants who never ever move, it’s impossible to do work in their apartment. You just sit and keeping hoping they move.
By laysclassic on 10.03.19 1:45pm
You can put tenants up in temporary housing while you do the repairs. Yeah its harder to do it on a unit by unit basis, but I think tenants have every right to make a stink when a landlord does NOTHING for decades then decides to just kick everybody out all at once.
By Greyvagabond on 10.03.19 1:57pm
WRONG WRONG WRONG. First of all tenants have the "right to stay put" landlords can’t force a tenant to temporarily relocate just because a landlord wants to "upgrade" . Tenants have the right to refuse. If you are part of LA rent control a landlord can force it but only on a tenant habitability plan that take 6 months to get approve. Landlord has to pay for temporary relocation assistance to the tenants, including the higher rent at the temporary location, moving and packing all personal property, costs of moving machinery or equipment, and set a definite date for the moves, with the written right to re-occupy the unit after the work is completed. Do the math. Let’s say I have a 4 unit building , 2 story apt bldg and all 2 bedrooms with mom dad and 2 kids living in each. Let’s say I want to upgrade all the plumbing because it’s old galvanized and I want new copper plumbing. I’ve have o do all the pipes underneath. plus all the pipes going up and down in the walls. I need to open all the walls , turn off all the water, replace the pipes, reconnect all tubs, showers, toilets, sinks etc, then close the walls, re-drywall, re paint etc, get permits, inspections etc. Doing all this is easily a 1 month job. Say I have 4 families I have to relocate. To Where? A hotel, an airbnb? I have to relocate them close to home because the law says I can’t do it too far from their normal life. No more airbnb homes because the city just outlawed that. So since they have two bedrooms, I can’t cram a family of 4 them in one hotel room. I have to get 2 rooms for each family, so a total of 8 rooms. Each room is $150/night, so that’s $1200 /night for all rooms times 30 nights, that’s $36,000. Plus since they don’t have access to a kitchen the law says i have to give them a food and incidental allowance $100/day per family, so another $12,000 for the month for everyone. Yes I get to keep their normal rents, say they were paying $1700/mo each, $6800. So it cost me in relocation $48,000 less the $6800 in rent, plus all the headache etc. , and then I still have to pay for all the work! Not gonna happen. That’s why many run down apartment look they do. The math doesn’t make sense!! LA doesn’t let you raise the rent anymore than 10% of your costs and that is amortized over a whopping 10 years..so basically no extra income to the landlord for doing the work. So that’s why people empty out buildings to do major upgrades!
By laysclassic on 10.05.19 6:28am
Wow, owning property sounds really hard, you should probably sell if you can’t afford the upkeep.
Or you can let it go to shit, but then don’t complain when people pass more rent control.
By Greyvagabond on 10.06.19 9:26pm
"you should probably sell if you can’t afford the upkeep."
You spelled "subsidizing someone else’s below-market rents in perpetuity" wrong. Railing against "greedy landlords" yet also advocating for a system where only the wealthiest people with piles of spare cash sitting around can afford to be landlords seems pretty contradictory.
The guy isn’t making these numbers up, they’re real-world numbers resulting from the policy you’re advocating, and as you can tell they’re very, very big. Ideology doesn’t make $50k in cash just simply appear.
This is also the rhetorical equivalent of telling tenants they should just move if they can’t afford the neighborhood, but something tells me that phrase has never rolled off your tongue…
By disqusted on 10.07.19 3:22pm
Just FYI, rodent infestations are not caused by the landlord ignoring the property, they are caused by the tenants not cleaning their units and properly disposing of trash.
By LADude on 10.03.19 1:53pm
Westlake is a total disaster. Trash everywhere. It’s disgusting. MacArthur Park should be a gorgeous jewel in Los Angeles and our city has let it become a dump. If people want to live in trash let them do it somewhere else. This area needs a Silkwood shower, new development and gentrification.
By eaglearts on 10.03.19 10:30am
"While juries in some of the cases decided in favor of the tenants-turned-activists, others lost their case, and close to half of the Burlington Unidos left the apartment complex."
"‘They want to fight this,’ says Trinidad Ruiz, an organizer with LATU who has been working with the tenants for more than a year. ’ They want some sort of legal advice and that’s what we’re trying to find them.’"
Yeah, great idea to listen to any legal advice from LATU, gives you a 50% chance to end up with a formal eviction on your record plus court costs. Ruiz is a complete joke, and should be sued by the former tenants for providing (bad) legal advice without a law license.
By disqusted on 10.03.19 1:10pm
Withholding rent and joining these bullsh*t tenant unions will always work out good for you in the end.
By theolder310 on 10.03.19 3:52pm
My roommate and I had our lease nonrenewed for our last apartment this past summer because the landlord wanted to "renovate" a middle class but functional apartment into a "luxury" unit and then charge 15% more. I was upset and frustrated that I was required to move and find somewhere else that ended up being more expensive than the previous apartment, though luckily only by $20 per month per person and missing some features we previously had. But, the entire time I have rented homes (rather than living with my parents) I have been well aware that I don’t own the property and there is no guarantee that the landlord will allow me to even continue living there past the terms of the lease. I feel for these people having gone through a forced nonrenewal due to renovation myself, but the building owner has every right to sell and the new building owner has the right to improve their property. I think ultimately it speaks to the larger issue of for-sale housing unaffordability.
By hoped on 10.03.19 4:08pm
Landlords must maintain habitability. Unfortunately, with tenants it’s a nightmare when rent controlled. Rent controlled apartments are falling apart. Long term tenants are reluctant to move out because they have a great deal on rent, yet have more deteriorating apartments. If it’s your own house, you’re willing to usually deal with the mess or the partial use of your home during a remodel. This isn’t the case with tenants.
Rent control should be applied to buildings on a rolling period of time like between 20 and 40 years old. We would have more housing if older lower density rent controlled apartments could be more easily torn down and rebuilt.
By Constituents on 10.03.19 4:25pm
That’s certainly an interesting idea – that way anything old enough to need serious maintenance could be redeveloped and meet the needs of the current area as well as newer building codes.
By hoped on 10.03.19 4:34pm
Why doesn’t the city/county just buy buildings like this and turn them into affordable housing or homeless housing? $251k a unit is less than half the per unit of the cost of the new buildings their constructing.
By Constituents on 10.03.19 4:30pm
Because there’s no ribbon cutting ceremonies for buying existing units, and the sales proceeds aren’t guaranteed to go to campaign contributors.
By disqusted on 10.03.19 4:34pm
Huh? You continuously advance the idea that ‘da gubmint’ can’t be trusted with our tax dollars but you want them in the landlord business? Sounds like you need an iPad.
By LosFeliz$ean on 10.03.19 4:39pm
Because if the county/city owns and operates them, the admin costs of running them will go up, new long-term costs will be attached as a result of city/county retirement benefits unlike anything in the private sector (see, for example, LAUSD or LAPD), and the properties will be subject to city/county bureaucracy (same).
By MyrnaMinkoff on 10.04.19 10:51am
I have some sympathy for the guy in that $1300 for a 1BR in Westlake isn’t stupidly low, and $600 is a big jump. Sounds like the owner was careless to let the building deteriorate badly enough to necessitate those kind of repairs and accompanying sharp rent increase. Who wants to pay $1900 to live in an ugly 80s building in Westlake?
Still, the owner (unprincipled as they may be) makes the rules, and it’s not the government’s job to set prices. A rent strike is terribly ill advised.
By MMVic on 10.03.19 5:46pm
Wow $48.3M for some rat-infested, ugly apartment buildings in dumpy Westlake? So much for anti-gouging rent control hurting apartment valuations.
By calzada on 10.03.19 7:13pm
I have to guess that’s $48.3M for the land.
By Greyvagabond on 10.04.19 11:23am