A family of wealthy philanthropists is one of a handful of investors backing the purchase of a Mission District building where some 14 rent-controlled tenants have received eviction notices.
Howard and Irene Levine — the husband and wife investors — are also the named donor for the Howard and Irene Levine Program for Housing and Social Responsibility at the University of California, Los Angeles.
The program — which trains graduate students in real estate — is aimed at addressing “timely and critical issues related to urban housing markets” including the “housing needs and outcomes of low-income and workforce households,” according to its website.
The pair also run a tax-exempt family foundation with assets valued at $16 million and hundreds of thousands of dollars in charitable donations.
But in addition to their philanthropic practices, the pair loaned $200,000 to Danny Sun on August 17, 2015 two days before he purchased a three-unit building at 2820 Folsom St. Eight months later — in April of this year — Sun gave eviction notices to all its tenants.
“They’re taking affordable housing, and these bastards are just getting rich off the backs of people who should remain in the city,” said Stephen Booth, a lawyer with the Tenderloin Housing Clinic who is representing 12 of the 14 tenants in the building.
Deep Pockets Fund Evictions
Booth first wrote of the tenants’ plight in Beyond Chron — a blog run by the Tenderloin Housing Clinic — in early May. He profiled the tenants facing eviction, many of whom are artists or musicians, and most of whom are working-class — teachers, baristas, and a Mission District baker.
The Levines did not return requests for comment. Tim Kawahara, the director of the UCLA program named after the family, said he did not know the specifics of the eviction deal and declined to comment.
“It would not be appropriate for me to comment,” he said.
Funding for the UCLA program was made through the Howard and Irene Levine Family Foundation, which pledged $3 million for the program in 2014. It pledged another $920,000 — and paid out some $933,000 — in grants to a variety of charitable causes, including more than $400,000 to Jewish and pro-Israel groups, including Birthright and a variety of congregations and schools, according to last year’s tax filings.
Howard Levine is an alumnus of UCLA, founder of a mortgage company, a board member of the affordable housing developer Mercy Housing, and a donor to the UCLA Ziman Center for Real Estate. At the same time, he and his wife were one of many wealthy investors who loaned money to Sun.
There is nothing illegal about the loans, but the story of the tenants on Folsom Street offers a glimpse at how wealthy investors can make money in a hot real estate market like San Francisco’s.
Other investors in the Folsom Street property include $350,000 from Leo and Donna Boger of San Jose, $500,000 from Boris and Tiffany Beljak of the Boris Beljak and Tiffany Beljak Family Trust, and $590,000 from Michael Moser of One to Four, Inc. Profit Sharing Plan.
The $1.64 million that Sun received from the investors allowed him to purchase the Folsom Street property for $1.72 million. It is unclear how Sun knew the investors.
The Folsom Street building is now worth some $2.7 million, according to the real estate website Zillow, meaning each unit could sell for some $900,000.
It is unclear how much each unit will be worth once it is remodeled and sold, but residential real estate in the Mission District averages some $900 per square foot, according to the real estate website Trulia.
The building is some 4,848 square feet, meaning the total price could be $4.36 million total — though realtors said such estimates were likely to be rough.
If Sun fails to repay his investors, they are entitled to take ownership of the house as a group, each investor with a share equal to the percentage of investment put in.
This is not Sun’s first Ellis Act eviction. He previously bought a rent-controlled, three-unit building in 2013 for a little more than $1 million and flipped it, evicting five tenants at 642 Natoma St. on April 24, 2014 through the Ellis Act.
The Ellis Act is a 1985 state law that was supposed to be used by landlords wanting to exit the rental market. In a tight real estate market, however, it is often used by speculators who pick up a building for a bargain price, evict tenants, and then resell the units at market-rate prices.
The building on Natoma Street, for example, was remodeled after the tenants were evicted. One of the units sold for $869,000 earlier this year, according to Zillow.
Leo and Donna Borger also loaned Sun $550,000 for the purchase of 642 Natoma St. — alongside some $1.2 million from four other investors. Donna Boger declined to comment on her family’s loans to Sun. None of the other investors could be reached for comment.
Both land deals specify that investors can expect to be repaid by Sun in full “with interest,” but do not define the interest to be paid.
“These people are speculators,” said Tommy Seiler, one of the tenants of the building. “It’s not owner move-in, it’s not rich people just moving in their families, it’s total speculation that destroys affordable housing in the city.”
For their part, the tenants are fighting their eviction. All have been offered buy-outs, according to Booth, but 12 of the 14 decided instead to seek legal assistance and fight the eviction.
The strategy is to ferret out improprieties in the eviction paperwork in an effort to further stall or quash the eviction.
“We tend to find weaknesses and try to exploit those,” Booth said. He said an eviction can be delayed two to four years, though “it depends on how good a job the landlord does” at filing paperwork.
Booth added, however, that the law firm retained by the landlord — Steven Adair MacDonald & Partners, which specializes in landlord-tenant disputes — “tends to do a pretty decent job on the paperwork.”
Still, he said, he believes he can quash the eviction — though he declined to describe a specific legal strategy.
This is the first in a three-part series about the purchase of the building at 2820 Folsom St. and the eviction of its tenants. Check back tomorrow for the next installment.
Part Two: Mission District Tenants Fight Deep-Pocketed Ellis Act Eviction, June 17
Part Three: Mission District House Targeted by Wealthy Investors Could Become Affordable, June 18
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Whenever you see someone starting a sentence with “Gee” you know it’s an old white guy likely from out of SF who just trolls sites to make fun of Sf and the “hippie liberals.” Then they say something completely useless and you confirm it.
Most of the comments here make me glad we stick it to The Man early and often, and I hope that the progressives re-assert control over the local political establishment. The incompetent mayor and the lying, cheating, rich realtor & developer $cum and their tech allies need to be kicked in the head over and over again. Fight their big $$ with votes and keep libertarian trollers from out of town and their rich allies out of OUR CITY. Suck on that, trolls!
Well lets just ignore the top down rich people that use tropes like ‘subsidized rent control’, or play around with fascist connotations of ‘types of people’. I wanted to add, to Joe’s good articles, some facts many of you sense or know. This is happening in cities all over the world with a 2nd central bank subsidized property bubble. And that’s what makes it even more gross. A global bubble that will pop and drag us all down even further. Just to fill the pockets of the rentier/finance class for another 6 years. Trillions of foreign money has flooded into the Bay Area and the rest of USA property markets. Equity funds started buying thousands of houses in Oakland years ago. Our own Fed loaned 12 goddamn trillion dollars at zero interest to the too big to fail. And this means in our world, what we have seen in just 7 years, is at least 40,000 working class and middle class people forced out of San Francisco. People losing their jobs, their communities, taking their kids from pretty good schools IMO, tearing their lives apart, and apparently having to move farther out to less dense areas, where commutes become longer, where real urban community is impossible to build, etc. not to mention…or just become homeless, then another face among a crowd of the detested low life working class, stripped of citizens’ rights.
Private developers in one hundred years of rich first world countries urban areas have NEVER built affordable housing for the working class, unless mandated by law and then heavily subsidized by taxpayers. We all know this. And now we see the really horrible effects of neo liberal economics, or free market worship….for the third bubble now (!) This is a policy of both political parties. That is something we have to realize. If I have to leave, so what…It will break me and break my heart, but I honestly care more about the 20 or so families that have been forced out on my block in 15 years…just one block alone. And now entire Victorians occupied by 2 or 5 people when there was 15 to 20…..or one floor going for $5 thousand fucking dollars. We have to step beyond outrage…and become more a threat than passive voters. As Douglas said, Power only respects Power. We don’t have the power. I think things will drastically change after this bubble bursts and we go into a depression….I just wish all the ghosts of those gone, could be here to pick up the pitchforks then. BTW ‘BOB EVANS’, you know my real name my address now, perhaps you’d like to come and talk face to face with me? har. ALSO, you all realize, as the listing states, the previous landlord ( a great guy really) was collecting $80,000 a year in rent. I think he did pretty good with rent control. Don’t you? Idiots can’t do math either.
@patmonk – She was part of *another* UC campus, Irvine.
Are these the same scum that recently evicted a 90 year old woman, forget her name, who died a few months after being evicted. I believe the woman responsible also held a position in some organization dedicated to ‘improving the lives of seniors’.
Gee, maybe if activists hadn’t been so good at stopping housing construction in San Francisco for the past several decades there wouldn’t be this mad scramble over the limited supply that is here. I laugh when I read that new projects must be 50%, 70% and lately 100% “affordable”. Bread and circuses win in out in the city that can’t anymore. How’s that working out for y’all?
Edwin, this is what I meant by your misuse of political capital. U abused the Mayor’s office, who might have been an ally in this struggle.Who pays-the tenants! How bout another hunger strike?
By subsidizing rent we get low-quality tenants. Let rates rise to market value and you are sure to get better neighbors- and lower instances of crime and noise complaints.
Wow, just because I’m a student who works two jobs to pay rent and put herself through school, suddenly I’m a “low quality tenant”. When the rates rise to market value, we get more folks making fatal phone calls to the police because of a dude eating a burrito. Also, fuck you.
Better, higher-quality neighbors…like you, Ace? I’ll take a raincheck.
Me for keeping the Mission full of good, honest, hardworking blue-collar and artistic folks, which is what made it great to begin with.
Its interesting to hear that less crime comes with wealthier tenants. Currently the Mission is experiencing one of the highest crime rates in many many years, car break ins, home invasions, shootings, assaults. This is with the addition of thousands of wealthier tenants. The problem is much more complex and we should not use poor people as scape goats for other gains.
You mean richer neighbors. You would be surprised but rich people are not always better people. Good luck with the Trump presidency.
Thank you! This constant equating of rich and good by these entitled fucking tech yuppies is nauseating.
Howard Levine is an ALUMNUS ( not alumni ) of UCLA…….sloppy journalism.
Actually digging deep and finding out the names, numbers, and stories behind this otherwise all to common eviction is actually pretty decent journalism. However calling them on one particular mundane editorial error is sloppy trolling.
I would like to hear how the speculators have used the state’s Ellis act law to enable this eviction. My understanding is that only pertains to certain landlord exit strategies like owner move in.
I’d much rather have more self enabled owners in SF, than greedy privileged rent controlled tenants. Some one will live there, most likely nicer people the the deadbeats there now
And you’re the expert on nice, aren’t you! What crimes are these “privileged” tenants guilty of, exactly (beside existing)?
so teachers and bakers are deadbeats? I bet a teacher taught you somewhere and I am sure you enjoy bread or a nice bagel or crossaint….perhaps with your barista coffee….where exactly are these people supposed to live and rent?
And that kind of attitude is why San Francisco is dying.
San Francisco is not dying. It is being killed by people who have names and addresses.
There are people being paid to ostensibly organize the community to resist being killed. They are not very effective yet they get paid anyway.
Where has David Campos and Hillary Ronen and Josh Arce been on stopping San Francisco from being killed? In large part they have been taking money from the same interests that are making a killing off of killing our City.
We can’t hope to turn the tide unless “our” side actually fights back to win, plays for keeps.