East Palo Alto residents and tenant advocates will take it to the streets this afternoon to protest Wells Fargo Bank's potential sale of about 1,800 units in the Woodland Park neighborhood to the investment fund Equity Residential.
Wells Fargo officials have confirmed in an email that Equity has been selected as a finalist in the sale of the apartments, which were previously owned by Palo Alto-based Page Mill Properties. Page Mill had antagonized tenants and East Palo Alto officials by steeply raising rents and filing at least a dozen lawsuits against the city, most of them challenging the city's rent-control laws.
Page Mill lost control of the portfolio after it defaulted on a $50 million loan from Wells Fargo in August 2009. The bank had since replaced property management, refurbished dozens of buildings and, in May, began searching for a buyer for the apartment buildings.
Wells Fargo said in a statement that bank officials last week met with Equity Residential officials and with tenant's rights organizations to update them on the sales process and to hear their feedback.
"We will continue to maintain an open dialogue with the community," the bank said in a statement.
But some tenants feel their feedback has been ignored and are calling on the bank to halt its negotiations with Equity Residential, a company they characterize as a "vulture investor." Equity is chaired by Sam Zell, a real-estate magnate who made national headlines in 2007 when he purchased the Los Angeles Times and the Chicago Tribune from the Tribune Company.
Critics of the potential sale point to Equity's record of contesting local rent-control laws. William Webster, who sits on East Palo Alto's Rent Stabilization Board, called Zell a "nemesis of renters across the nation" and said the sale of these properties could lead to displacement of residents from the Woodland Park buildings.
Members of the group Youth United Community Action are also protesting the potential sale.
"The era of Page Mill Properties was a disaster for low-income tenants," Gaby Gonzales, a Woodland Park tenant and a member of YUCA, said in a statement. "Now one wants to repeat that fiasco with Zell's investment group."
But Wells Fargo is maintaining that Equity is well suited to taking over the properties in the west side of East Palo Alto. In a statement, the bank called the company a "very experienced owner of apartments both nationwide and the Bay Area" and one that has a "long-time ownership perspective."
"They are an exceptionally well-capitalized firm with an extensive track record of handling large, complicated transactions and have demonstrated expertise in owning and managing rent controlled and rent-restricted properties," the bank said.
The rally will begin at 3:30 today (Monday, Aug. 22) in front of 5 Newell Court in East Palo Alto. Participants will then march at 4 p.m. to the Wells Fargo branch at 400 Hamilton Ave., Palo Alto.