Tenants allege harassment in East Palo Alto | December 5, 2008 | Palo Alto Weekly | Palo Alto Online |

Palo Alto Weekly

News - December 5, 2008

Tenants allege harassment in East Palo Alto

City drops lawsuit against Page Mill Properties, but tension remains

by Gennady Sheyner

The railings inside 2001 Manhattan Ave. glisten with fresh black paint, but the hallways are deserted, save for a crew of painters. About a third of the apartments in this East Palo Alto apartment complex are vacant and visitors can pass by stretches of three apartments with doors ajar, revealing freshly installed Pergo floors and spotless kitchen cabinets.

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Staff Writer Gennady Sheyner can be e-mailed at gsheyner@paweekly.com.

Comments

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Posted by PA Resident
a resident of East Palo Alto
on Dec 5, 2008 at 11:33 am

Thank you for writing this insightful article about the abuses of Page Mill properties. It is clear to anyone who has actually dealt with this company that they are dishonest and abusive. They harass tenants and play hardball to try to drive people out of these units. I suspect most of the improvements are surface polish meant to convince investors that they are really getting the rent increases and occupancy rates that they intend. Meanwhile, Page Mill's plan is obviously one of trying to destroy the citizen passed rent control ordinance and to bankrupt the city of East Palo Alto through ridiculous lawsuits and obstructionist techniques.

Page Mill is not a legitimate business as far as this renter can tell. Rather, they are destroying the community of East Palo Alto, hoping to turn it into the next Emoryville. Let me tell you, it is very unpleasant to live next to a whole series of vacant units as a large company, using public money, has forced your neighbors out illegally. Vacant units are ultimately breeding grounds for crime, and Page Mill is encouraging crime and social disintegration through their practices.

It is time that the people of the greater peninsula area band together to force a cruel speculator and manipulator like Page Mill to follow the law and stop playing games with real, hard-working, honest people's lives. East Palo Alto's rent control and housing laws are mild and reasonable, but Page Mill has been breaking them and abusing people in a way that is not bringing improvement, only misery and suffering.

I applaud the Palo Alto Weekly for finally covering this issue through a well written article. Page Mill is a blight on East Palo Alto, and they need to change their policies or get out of town. They are not at the moment holding true to their claims to improve the area. East Palo Alto was incorporated as a city to fight cruel speculation and the kind of funny-business of superficial improvements and real depredation.

The Weekly would be doing everyone a service if they looked a little deeper into the funny business of Page Mill's financial claims. The vacancy numbers are not the only funny numbers beneath the surface of the Page Mill LLCs and Mr. David Taran. Think Enron in our back yard.

-a concerned epa tenant


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Posted by palo alto tenant
a resident of Professorville
on Dec 5, 2008 at 1:00 pm

[Post removed due to same poster using multiple names]


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Posted by Chris Lund
a resident of East Palo Alto
on Dec 5, 2008 at 6:41 pm

To get a sense of the magnitude of this crisis, remember, Page Mill Properties (PMP)currently owns 1789 units in this neighborhood; Page Mill has confirmed the size of their holdings.

According to 2000 US Census data, the average household size for renter occupied units in EPA is 3.83. Although PMP is required to provide vacancy data on rent controlled units under local law, they have refused to do so. Vacancy rate data for a random sample of nearly 450 of these PMP units show that, as of November 30, 2008, the vancancy rate in the portfolio is 24%. The sample size is more than sufficient to capture the true value given the size of the variation between buildings. I deal with sampling, and sampling error, on a regular basis in other work. This value of 24% is highly reliable, and very close to the target value of typical predatory equity schemes outlined in Gretchen Morgenson's May 9, 2008, NYT piece. Page Mill's reported value of 13% is nonsense. If this is the case, have them provide addresses and unit numbers, let the public take a look for themselves. We also have numbers on the portfolio wide average rent increase, and the San Mateo County Sheriff's Office has been kind enough to offer data on pre- and post-Page Mill eviction rates.

Historically, again based on 2000 census data, vacancy rates in this area are < 2%. Ask yourself, how do you get from < 2% to 24% in less than two years? So, using the renter occupied household size of 3.83, we can see that we had roughly 6700 people living in these units prior to transfer of ownership to Page Mill Properties. In moving from historic rates of < 2% to the current rate of 24%, of these original 6700, we have lost roughly 1500 people to harassment, evictions, etc. over the past 18 months. This is the "recapture strategy" pointed out in the May 9, 2008 NYT piece on predatory equity. Remember, under a CA law called Costa Hawkins, vacated units may be raised to market rates. Again, a combination of systemic harassment and litigation are used to achieve these targets. Unfortunately, all of this is targeting a population that can be classified as working poor, with demographics as follows: 60% Latino, 22% African American, 6% caucasian, and 2% other. A large fraction of the Latino population have no immigration papers, and this plays in favor of PMP's strategy. This population has ESL or no English language skills at all, is generally unaware of legal rights, and understandably, reluctant to assert these rights even when they are aware of them.

In walking the neighborhood yesterday, I met a 30 yo woman that had been evicted from her unit on Dec 1. She was late with her November rent by several weeks. When she went to the mangement office to pay, rather than accepting payment and charging a late fee, Page Mill simply refused payment. Unfortunately, this is a common practice. She is now living with her 9 and 7 yo daughters, as well as a 6 mo old infant out of her car.

Minutes later, I met a woman, Tina, who had left her apartment on Dec 1 to avoid having an eviction on her record. She is a brittle diabetic and struggles with the burden of heavy medical costs. This summer, Page Mill informed people with disabilities that they would offer reduced rents under special circumstances. She pursued this offer, and to Page Mill's credit, they agreed to meet. However, PMP only offered to reduce her rent from $953 to $910 per month. As she pointed out, this is the cost of one medication copay. Late this summer, this tenant lost her job in shipping/receiving. Unable to afford the rent, and wanting to avoid an eviction on her record, she gave notice. She is now homeless, obtaining housing vouchers from El Concilio in EPA when she can, and sleeping in her car when she can't.

Or the story of Artemio, who survives on a fixed income of $913 per month. After receiving the PMP letter regarding reduced rents for special circumstances, Artemio requested a meeting to discuss his circumstances in a letter dated June 26, 2008. He sent this letter via certified mail to PMP. As of today, Mr. Aboytes is still waiting for a response.

Or, Sione, who I found moving this past weekend after he received a notice to vacate from PMP. When I asked Sione what he would do, he said he would move his things to a small storage unit. When I asked him where he would stay after Dec 2, he responded, "I don't know....maybe my car, for now."

I see and hear these stories every day. People come to me, desperate for help. We are losing, on average, almost three people per day, 20 people per week, week after week. This will no doubt continue throughout the holiday season.

Remember, this business model isn't generating ordinary profits. According to CalPERS own classification, this is called an "opportunistic" investment fund. That is defined as anything that returns > 13% annual returns. One additional point on the CalPERS angle is worth mentioning, and this is where things get even more interesting.

In 2005, CalPERS, along with other leading pension and investment groups drafted a document at the United Nations on Principles for Responsible Investment. CalPERS became a signatory to this document in April, 2006. As a signatory, CalPERS commits to the following principles of socially responsible investing:

Web Link

In addition to being a signatory, CalPERS is a large enough player that they have a representative on the elected board of 11 asset owner signatory organizations. Members of this board oversee implementation of the compact along with two representatives from the UN.

Here's the rub; in CalPERS investment reports, the inception date for Page Mill Properties II, L.P. is shown as July 2006. Page Mill Properties II, L.P. is the specific fund that owns the EPA portfolio. Page Mill Properties LLC serves as the general partner on this fund.

So, in April 2006, CalPERS becomes a signatory to, and helps oversee the UN PRI. Three months after signing the UN agreement, they dump over $50 million into a predatory equity scheme in their own back yard. As of June 30, 2008, CalPERS net assets at fair market value for this fund was $69,861,698.

The opportunistic profits for private equity and public pension funds are being made on the backs of people that are, for the most part, powerless. They are dispossessed. They include the working poor, the mentally ill, people struggling with drug addiction and other health issues, the list goes on. They have demonstrated unbelievable dignity in light of the current situation, but they are scared.

If we don't stand up for these people, who are we as a community?


Like this comment
Posted by tough luck
a resident of Midtown
on Dec 5, 2008 at 7:32 pm

Boo hoo,

We would consider helping you like we always have but your actions against our police chief helped show me that you don't deserve our help. You can't take care of yourself and are always looking for a handout. Mind your own business mayor and reverend and your business should be the City of E. Palo Alto. Maybe if you spent half as much effort that you did protesting the chief's mistake, your city would be better off.


Like this comment
Posted by Palo Alto resident
a resident of Barron Park
on Dec 6, 2008 at 7:17 am

[Post removed due to same poster using multiple names]


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Posted by Concerned
a resident of Downtown North
on Dec 6, 2008 at 8:29 am

I agree with the previous poster. In times like these, we need to recognize that communities are made of people, and that money is everything. Page Mill seems like a predator, using other people's retirement money (debt) to attack the poor. If they were honest, they would state what their development plans were, but Page Mill is obviously not honest, but reflects the worst in this country. Talk about Wall Street greed all you want, Page Mill is obviously the debt manipulation story that has been ravishing this country come home to a local redlined community. It is disgusting, and it is not development, just securitized, commoditized, limited liability harassment.

Everyone who is a member of calPERs to write a letter to their investment office asking that they look into this. And by the way, if you are not a member of CalPERs, you might want to ask your elected representatives. Most officials and judges (!) are invested in this monster, and maybe its time they do some investigation of the land speculation and asset overvaluation in their own backyard and in their own portfolio. This problem isn't going to go away, and the cancer is better cut out than left to fester.

-Awake in PA


Like this comment
Posted by Thoughts
a resident of Meadow Park
on Dec 6, 2008 at 10:16 am

"In walking the neighborhood yesterday, I met a 30 yo woman that had been evicted from her unit on Dec 1. She was late with her November rent by several weeks. When she went to the mangement office to pay, rather than accepting payment and charging a late fee, Page Mill simply refused payment. Unfortunately, this is a common practice. She is now living with her 9 and 7 yo daughters, as well as a 6 mo old infant out of her car."

I'm more concerned with the thought process of a mother living paycheck to paycheck choosing to have another child rather than PGP's decision to enforce a contract made between willing parties.


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Posted by Surprised in PA
a resident of College Terrace
on Dec 6, 2008 at 2:07 pm

[Post removed due to same poster using multiple names]


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Posted by StanfordDoc
a resident of Professorville
on Dec 6, 2008 at 8:02 pm

[Post removed due to same poster using multiple names]


Like this comment
Posted by Thoughts
a resident of Meadow Park
on Dec 6, 2008 at 10:39 pm

"Surprised"

Yes, I know many people that live in EPA. Yes, I have spent much time there.

I stand by my comments. PMP can charge whatever they legally can charge. I encourage those who can't afford the rent to find a new place to live.

If, for some reason, I can't pay my property tax or my loan, I would be in the same situation and would be forced to move. No different.


Like this comment
Posted by Surprised
a resident of College Terrace
on Dec 6, 2008 at 10:53 pm

[Post removed due to same poster using multiple names]


Like this comment
Posted by BeThatOne
a resident of another community
on Dec 7, 2008 at 12:53 am

People are always putting mothers down. If it weren't for mothers having babies there would be a shortage of people eventually. Children are our future. These people are human beings, just like the rest. We know its all about the, "Benjamins," Who cares if a mother, or a father, or a person, children, have to sleep in their car! Thank God that they have a car to sleep in! If it takes a village to raise one child, how can one call a welfare mother lazy. I know it took alot out of me just to give birth to my children. And Yes I was living in East Palo Alto on Manhattan Ave. in "2001". I moved out of the city because my rent kept going up. I was going to school and raising my last child. My daughter was in kindergarden before we moved, she had her little associates that helped her around school because she is shy and was not use to being away from me. I had problems with her dealing with a new city because we had grounded in East Palo Alto, with her going to Plugged-In and all. Oh...my older children when they were young had to sleep with me in my car one December. I had been working and I became ill and had to have major surgery. My doctor told me because of red tape he had to take the staples out that was holding me together and I told him that I wasn't healed because I could still see blood ozing out. He took them out anyway and my incision opened up. I was sent home and couldn't get out of bed for six-weeks. I couldn't go back to work and it took state disability months before I could get any monies so I had to move out of my apartment on E'Okeefe and live in my car, otherwise I would be facing an eviction. I would wake-up and couldn't move until the sun was shining around noon to thaw me out. I was fortunate to have people to take my children in, because Palo Alto P.D. Officers told me that I couldn't sleep in my car and that my children would be taken away from me. I was trying to fight all of this. I found out that there are agencies out there, to me most of them seem to be a front for goverment funds. (They only have money for operational costs and not enoungh funds to help you, or short staff and limitations. Write letters to your local Representatives. Get petitions with signatures, and don't give up. Go to public and law libraries and look-up civil rights. Use the computers to find information. You can sign-up to use computers free at public libraries. I don't know if "Pluggin-In" is still around, I use to go there and use the computers all the time. (Located in East Palo Alto). The law library is in Redwood City. Check to see what their policy is because I think the rules have changed. I use to go there and look up family law. Just don't give up!


Like this comment
Posted by Chris Lund
a resident of East Palo Alto
on Dec 7, 2008 at 7:28 am

Page Mill Properties is currently entertaining offers on its EPA apartment portfolio. Potential buyers that have been mentioned include Palo Alto based Pacific Property Company as well as Los Angeles based Kennedy Wilson. You can contact these companies and make your voice heard:

Pacific Property Company, 650-856-9800.
Or Kennedy Wilson's San Francisco office, 415-986-5002.

I also encourage concerned members of the community to contact Congresswoman Anna Eshoo's office at 650-323-2984. Your call will make a difference.


Like this comment
Posted by Andy Blue
a resident of another community
on Dec 10, 2008 at 12:55 pm

Regarding this comment:

"I stand by my comments. PMP can charge whatever they legally can charge. I encourage those who can't afford the rent to find a new place to live."

That's exactly the problem. PMP is clearly violating the Rent Stabilization Ordinance with their rent increases. They are breaking the law and believe they can get away with it because of their team of high-priced lawyers. This is a grave injustice.


Like this comment
Posted by LinksToRead
a resident of Menlo Park
on Dec 10, 2008 at 4:05 pm

While Googling stories on the PMP issues, I have come to some interesting links that shed light on various aspects of the PMP/EPA residents conflicts:

Web Link

Web Link

Web Link

Web Link


Like this comment
Posted by To Chris Lund
a resident of East Palo Alto
on Dec 10, 2008 at 4:13 pm

I met you at the meeting last night & passed on my info. Can you please contact me when you have time? I would like to be more involved. Thank you.


Like this comment
Posted by Andrew
a resident of East Palo Alto
on Jan 21, 2009 at 11:35 am

In response to the person standing up for PMP... it's easy to say "boo hoo" from a distance, but you would feel differently had you lived in one of these properties. Even to the tenants who paid on time, made an honest living and could afford the rent hikes, Page Mill was aggressive and dishonest. We received threatening, bogus eviction notices, our phone calls and emails were never returned, our shared appliances like washing machines and dryers were left un-repaired for months, despite our work orders and phone calls, and our rent was raised at an illegal rate, based on the city's laws.

Page Mill is engaged in illegal, unethical practices. It's time they were held accountable.


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Posted by venturetape@live.com
a resident of Southgate
on Mar 2, 2009 at 9:53 am

[Post removed by Palo Alto Online staff.]


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