LA City councilman proposes using federal stimulus funds to buy distressed properties for homeless housing
LOS ANGELES - Landlords in Venice are calling Los Angeles City Councilman Mike Bonin “exploitative” and “predatory” after Bonin pitched a proposal to use federal stimulus money to buy up distressed properties that go “belly up” and turn them around into housing for the homeless.
Bonin made the comments during a teleconference last week.
“I intend on putting in another proposal in the next week or two that asks the city to look at the federal bailout or stimulus funds we’ll be getting as a result of this crisis, and use some of that to either buy hotels that go belly up or to buy the distressed properties that are absolutely going to be on the market at cheaper prices after this crisis is over,” Bonin said. “And use that as homeless and affordable housing. It’s going to be a hell of a lot cheaper to purchase stuff that is already there and move people in there than if we start from scratch.
“When he said that, my jaw just dropped, I gasped, I mean it’s disgusting,” said Venice landlord Soledad Ursua. “He sounds giddy, he sounds excited.”
Ursua has owned a triplex in Venice for the past five years, fixing it up to rent out to her tenants, but she may not be able to hold onto it much longer.
Her tenants are protected by the city’s emergency rent freeze during the pandemic, leaving her in a financial hole.
“In the course of one night, my place went from being an asset to a liability,” she said. “In April, I got zero rent, I had to pay second installment property taxes to the county, and I’m not getting any rent from May onward.”
Mark Ryavec, the president of the Venice Stakeholders Association, is in the same boat, and had a similar reaction to hearing Bonin’s comments.
“I was disgusted by the attitude, it’s highly predatory,” he said. “The city sets up the conditions for small mom and pop landlords to fail because it lets their tenants not pay the rent, and yet they don’t provide any relief to the small mom and pop property owners, I’m one of them.”
In an interview with FOX 11 reporter Bill Melugin, Bonin responded to the criticism.
“The city has a unique opportunity right now to use federal funds to quickly get people on the streets housed,” Bonin said. “This is an attempt by the city to prevent predatory behavior, last time there was an economic crash in 2008, hundreds of thousands of residential units across the country were bought up by hedge funds, as a result, a lot of people got evicted.”
Bonin said if local properties and hotels are inevitably going to go under during the crisis, the city should take advantage and house the homeless at a major discount, rather than let the properties fall to venture capitalists.
“This may be the best opportunity in a century to add significant affordable housing to the city of Los Angles, and I would much rather have the people of LA or nonprofits or community land trusts acting on behalf of the people managing the properties rather than have them gobbled up by huge hedge funds and big investment firms and have everything be gentrified into luxury housing,” Bonin said.
“I realize at the end of all this, the city might end up with my property,” Ursua said. “They better be in for the fight of their lives, because we will fight tooth and nail.”
Bonin said the city council supports the proposal and is looking to fast track it, but it will be up to mayor Garcetti to give it the green light with his emergency powers.
Bonin also said some city councilmembers including himself are looking at setting up a fund to help struggling landlords get through the economic crisis.