Rent Hikes Averted in Chinatown Building

A tentative deal to prevent rent hikes at an affordable housing complex in Chinatown has fallen through. Despite claims of a preliminary agreement being reached in July between the landlord and tenants of Hillside Villa, with support from First District Councilman Gil Cedillo, the building’s residents were notified of rent increases at the start of the month.

Residents from Hillside Villa said they were hit with a 5.5% rent increase on Sept. 1. The property’s landlord says that claims of an agreement were preemptive.

Hillside Villa, at 636 N. Hill Pl., was built in 1988, with a 30-year affordable housing covenant. That expired in August 2018. In late July tenants, the tenants’ legal partners and Cedillo announced that a tentative deal had been reached to prevent rent hikes. Under the plan, affordable housing for the 59 residents would be maintained for another 10 years, in exchange for the city forgiving the remainder of a $5.5 million Community Redevelopment Agency loan used to build the apartment.

The majority of the other apartments in the 124-unit Hillside Villa are occupied by people using Section 8 vouchers and are not impacted by the covenant and rent hikes.

In a public statement, Cedillo called the breach of the agreement “completely unacceptable.”

“It violates the most important tenets of the agreement that guarantees the current Hillside Villa tenants a place to call home,” Cedillo said. “This misguided action returns us to the same uncertainty of the last few months when tenants were subjected to a roller coaster of emotions, from being promised no evictions one week and then receiving notices the next; receiving notifications of rent hikes one day and then rescinding the increases the day after.”

Under the public terms of the proposed deal — the full agreement has not yet been released — tenants would not see rent increases, displacement or evictions for 10 years, in exchange for forgiving the loan.

Cedillo said that the Housing and Community Investment Department is reviewing the terms of the deal.

However, the building’s owner said that Cedillo’s office jumped the gun in claiming so. The landlord, Thomas Botz, said that he is still in talks with the city.

“When Cedillo filed his motion to get that deal approved, we opposed it. We have a lot of open issues, it’s premature,” Botz told Los Angeles Downtown News last week. He said that due to a technical error in the original notice issued when the covenant expired in 2018, he gave the tenants an extra year of affordable housing. The new 12-month notice went out to residents, saying that those units in Hillside Villa would be brought to market rate prices on Sept. 1, 2020.

The expiration of the covenant sparked concerns among the low-income residents of Hillside Villa. Many organized protests against the hikes over the past year, with allies from the Los Angeles Tenants Union, Chinatown Coalition for Equitable Development and the Legal Aid Foundation of Los Angeles. The councilman’s office got involved in negotiations in the late spring.

In response to the rent increases sent at the start of month, Cedillo said that he would request that City Attorney Mike Feuer “fully enforce and pursue all legal options available to us.”

In response to the rent increases, the Legal Aid Foundation said it is not currently pursuing any action, but did say that a deal had been reached in July, and that it hopes that it can be finalized.

“Botz made public statements indicating that affordability would be extended at Hillside Villa for 10 years, and the community expects him to follow through on those statements,” Legal Aid Foundation said in a statement.

A meeting between Botz and the Los Angeles Housing and Community Investment Department is set for this week.