Oakland fights to save rooms to house poor
Developers upgrade residential hotels, evict longtime tenants
Orlando Chavez has no intention of leaving the tiny, cluttered room where he has lived for eight years, with its bent window blinds, tattered carpet and leaky bathroom ceiling. Upstairs, construction crews tear through walls inside the six-story building, one of downtown Oakland’s last single-roomoccupancy hotels.
“They’re turning this into a tech haven,” Chavez, 65, said about the 113-year-old Hotel Travelers, which is being converted into dorm-style housing for young professionals.
Chavez and two other tenants refused to move after the landlord, NDO Group, gave them 60-day eviction notices in July. Now five tenants, including Chavez, are suing NDO Group, alleging harassment and violations of Oakland’s tenant protection ordinances.
The Hotel Travelers is one of many buildings that have historically provided housing for the city’s poor but now face transformation for a wealthier demographic. With rents escalating rapidly and Uber preparing to take over the old Sears building, adding thousands of new employees to the downtown area, two City Council members are pushing for legislation to preserve these old hotels.
“Single-room occupancies have traditionally been a
housing of last resort for people with bad credit, people who are sick, who have addictions or mental illness that would otherwise put them on the streets,” said City Council President Lynette Gibson McElhaney, who is leading the effort. She noted that residential hotels do not require credit checks, proof of income, large security deposits or long-term leases, making them more accessible than other forms of housing.
If they disappear, the consequences could be dire, particularly because the city already has a big homeless population, McElhaney said. The most recent one-night homeless census, taken in January 2015, found 1,400 people sleeping outside.
“We have a need for these buildings,” she said. “The fact that they’re going away has my stomach in knots.”
The problem isn’t limited to Oakland, said state Sen.-elect Nancy Skinner, D-Berkeley. Since 1960, she said, the number of single-room-occupancy hotels in Sacramento has dropped dramatically — from 78 to 14. In Los Angeles in 2008, city officials passed a law to protect 336 residential hotels.
Strong city ordinances have kept the number of SROs relatively stable in San Francisco, but some of those rooms are now going to students, tech workers and tourists.
“We’ve seen hotels advertising rooms on Airbnb or Booking.com, or they’ll give vacant rooms a little touch-up and rent them out for $1,100 a month,” said Chirag Bhakta, a longtime community organizer in San Francisco who works for the nonprofit affordable housing developer Mission Housing Development Corp.
Because San Francisco does not cap rent in residential hotels, building owners can charge what the market will bear.
“Honestly, if the demand was high enough, an SRO room could go for $3,000 a month,” Bhakta said.
In downtown Oakland, where a commercial boom has been under way for years, residential hotels have been replaced with more profitable ventures. A city report written last year by UCLA graduate student Brian Warwick documented some of these transformations. The Alendale Guest House near Lake Merritt became a market-rate apartment building, and the Hotel Westerner on San Pablo Avenue was demolished to make way for the Uptown development. The shuttered Will Rogers Hotel,
“Single-room occupancies have traditionally been a housing of last resort for people with bad credit, people who are sick, who have addictions or mental illness.” Lynette Gibson McElhaney, Oakland City Council president
ravaged by fire in 2002, was reborn in 2009 as the Clarion, a boutique hotel with a fitness center and two restaurants. The former Lake Merritt Lodge reopened in 2014 as a student dorm for the Hult International Business School in San Francisco.
With 18 SRO hotels left in Oakland’s downtown corridor, public officials are looking at how to help residents like Chavez. But, there’s no legal mechanism to stop the SRO conversions.
Oakland’s housing laws do not prevent residential hotel owners from turning their buildings into something that generates more income, such as a boutique hotel or condominiums. Building owners can even convert low-income hotel rooms into restaurants or offices, as long as the benefits of the conversion outweigh the loss from the city’s housing supply.
McElhaney and City Councilman Abel Guillen have asked the city’s planning department to craft SRO-protecting legislation. The council has also urged state legislators to exempt residential hotels from the Ellis Act law, which allows property owners to evict tenants and leave the rental business.
San Francisco and other California municipalities already have Ellis Act exemptions for residential hotels, but smaller cities such as Oakland lack that regulatory ability.
McElhaney said she is contemplating a six-month moratorium on residential hotel conversions to prevent owners from rushing to sell or lease their buildings before any new laws are adopted.
But promises offer little security to Chavez, who grew up in Oakland and has spent decades living in roach-infested hotel rooms and scruffy apartments. He said Oakland housing officials offered to put him in an apartment in Napa, far away from his day job at Glide Memorial Church in San Francisco.
“So I’d be commuting from Napa to San Francisco?” asked Chavez, who has nerve damage in his feet.
Owners of SRO hotels say many of the buildings date to the early 20th century and are ramshackle, rat-infested and expensive to maintain.
“When we came in, the bathrooms were moldy and the shared kitchen was dilapidated,” said Thomas Kerbleski, whose firm, Lakeside Investment Co., was among a group of investors that purchased the Fremont Hotel on Eighth Street in September 2015. Oakland City Attorney Barbara Parker sued the group in June, saying the owners had demolished parts of the interior as a ploy to boot out the low-income Chinese immigrant tenants and jack up rents.
Danny Haber, a partner in the group that owns Hotel Travelers, said that when his company first took over that property, the floors were rotten and mice were crawling up alongside the toilets.
“They had fixed the plumbing with duct tape,” he said. “There were bedbugs everywhere.”
Haber said he plans to increase rents when the building is renovated but keep them below market rate. Real estate website Zillow shows the market rate for a one-bedroom apartment in downtown Oakland is about $2,445 a month.
Housing advocates, meanwhile, are urging the city to buy the troubled buildings before developers can convert them.
The city could sell the buildings to nonprofit developers who would take care of the rehab effort, said Jeffrey Levin, policy director for the nonprofit East Bay Housing Organizations. Such an arrangement worked at the Empyrean Towers Hotel in Oakland’s Chinatown, a blighted building being restored by the Berkeley nonprofit Resources for Community Development.
Solutions may take months or years to implement — too long for low-income renters who face imminent displacement.
One such tenant of Hotel Travelers was T. Baumann Knapp, who died of liver disease in September while pursuing the harassment case against NDO group.
“He spent his last days up there alone, isolated and under pressure (from) management,” Chavez said. “And they kept asking him, ‘When are you going to move out?’ ”