5 Rose Ave. tenants wonder: Do you have to be rich to live by the
sea?
By Jim
Smith
The big white-brick building on
Rose Avenue, smack up against the beach, is a historic reminder of Venice a
hundred years ago. It’s also a symbol of an affordable Venice and a
developer’s fantasy of an unrecognized and gentrified Venice to
come.
Until a few years ago, a faded sign high up
on the building still advertised long-gone rooms for $1.50 a night. While the
sign is gone, 5 Rose remains a home for many with low incomes where they can
smell – and hear – the surf, and breath fresh air.
But now, 5 Rose is in danger of
becoming Lincoln Place-by-the-sea where more and more apartments are vacated and
remain empty.
Disabled and seniors with
Section 8 vouchers still occupy 25 of the 60 mostly-single units, but 16 more
are now standing vacant, their residents having decided to move on, or have been
paid to leave. Tenants under the federal Section 8 program pay 30 percent of
their income in rent. The program supplements this with as much as an
additional $500 a month. At 5 Rose, the landlord receives a total of about $850
per month. The remaining apartments are market rate and rent for as much as
$1,100-1,250 per month. Presumably, when their occupants move out, they will not
be re-rented.
The building was sold
last April. The previous owner, MacLaurin Ocean View Properties, offered some
helpful hints to the buyer on how to gentrify the building: 1) put a bar in the
basement; 2) turn the ground floor apartments into retail spaces; 3) put a patio
on the room; 4) investigate kicking out the Section 8 tenants.
John MacLaurin, a professional
landlord and yachting enthusiast, reportedly bought 5 Rose in 1975 for $250,000.
However, he borrowed nearly $3 million on the property in 1997-98 and stopped
accepting new Section 8 tenants. He then put the building up for
sale.
To facilitate the sale, a real
estate broker had a 32-page brochure prepared that waxes eloquently about the
building and the neighborhood: “Venice Beach has now become a desired
tourist destination for travelers the world over. Unlike any other place on
earth, it’s as well known for its artists & musicians (Dennis Hopper,
Rip Cronk and The Doors), as it is for its picturesque coastline and miles of
sandy beaches. A walk along the Venice Boardwalk instantly makes you aware of
the city’s free spirit and creative
atmosphere...”
A property consortium in
Calabasas decided this was a hot property and plunked down $10,800,000 for the
95-year-old apartment building. Unfortunately for them – and perhaps for
the tenants – Zillow.com, the property appraisal website, estimates 5 Rose
as being worth only $4,106,885.
How can
the suits from Calabasas recoup their investment? They could join the crowd and
convert to condos. But that would require extensive remodeling and there’s
a big problem – there’s no parking at the building. In the face of
determined tenant resistance, the city might be hard pressed to approve a condo
conversion without any place to
park.
Another option would be to turn
the building into a boutique or an extended stay hotel. There have been several
such conversions at smaller buildings in the North Beach
area.
What would happen to the tenants
if they had to move? There are few options for a large low-income migration in
Venice. At Lincoln Place, some tenants had to go as far as San Bernardino and
Escondido to find affordable housing. If they are forced out, younger renters
would receive $8,500 to move, according to the city ordnance. Seniors and
disabled tenants would get $17,000 to move. But after paying first and last
months rent to move in, and a much higher rent every month, the money would
probably be used up within a year.
Posted: Thu - November 1, 2007 at 02:23 PM