Lies and Deceit Behind Oakland’s Condo-Conversion Scheme

by Lynda Carson on December 15, 2006

The latest campaign to promote the conversion of 800 or more of Oakland’s rental housing units per year into market-rate condominiums failed — despite the lies, distortions and deceit being used to convince Oakland’s renters that they would benefit from the current proposals. At the December 5th Oakland City Council meeting, Councilwoman Delsey Brooks pulled the plug on the scheduled vote before it occurred — after it became apparent that there were not enough votes to support its passage. The controversy over the proposal really heated up when it became apparent that its backers were willing to use lies and deceit to convince a skeptical public that the condo-conversion proposals would actually benefit Oakland’s renters.

Only days before the City Council was to vote upon the matter, Oaklanders in different districts received a deceptive mailer that appeared to be from or directly linked to each City Council member, seeking their support to weaken the existing condo-conversion protections. The mailers were tailored differently for each council district, and council members received a flood of complaints about the deceptive mailers.

Oakland homeowner Lydia Ganns found one of the mailers in her mailbox, and called Councilwoman Jane Brunner’s office to complain about the deceptive aspects of the mailer. “Being aware that something was going on with the recent condo-conversion proposals, I was surprised to receive a slick glossy urging me to support the proposals, and it seemed very misleading. It failed to mention that the 800 proposed condo-conversions per year would result in the displacement of hundreds of families from their rental housing units in Oakland, if it was to pass. It really angered me that someone placed it in my mailbox without using the postal system to mail it to me, which is illegal”, said Ganns.

According to Councilwoman Patricia Kernighan’s office, they had nothing to do with the deceptive mailers. “We had nothing to do with the mailers being sent out to
people in our district,” said Jennie Gerard, Chief of Staff for Councilwoman Kernighan. “I oppose this proposal,” said Councilwoman Jean Quan in an e-mail to an angry constituent. “This mailing was not done by my office but by developers trying to rush us into acceptance.”

Local attorney Phil Rapier, a Housing Committee member in Ron Dellums Citizens Task Force, received one of the glossy mailers. “I received one of those mailers from the Better Housing Coalition, and it was really well done. The developers have learned a lot since the Measure EE campaign took place a few years back, when the slick glossies in opposition to eviction protections had photos of tenants with mean looking dogs, or there was the mailer with a gruffy looking beer drinking biker (motorcycle), being portrayed as the neighbor who would never be evicted, if Measure EE passed. The glossies sent out lately, were real slick with a beautiful photo of a couple needing housing, and they hid the source of the funding or who was actually behind the campaign to weaken Oakland’s condo-conversion protections. I might have been swayed to support the proposals, had I not been involved in the campaign to save Oakland’s rental housing stock,” said Rapier.

Greg Mc Connell, founder of The McConnell Group, an anti-rent control organization, formed the Better Housing Coalition over a year ago, which is a political coalition of developers. Its membership includes such developers as Madison Park, Forrest City, and Signature Properties, among others.

It was the McConnell Group who spearheaded the latest legislation in Oakland to weaken the condo-conversion protections in an effort to prop up the sagging condominium industry, that took a downhill slide during recent months.

Back in May 2006, as first reported in the SF Business Times, the Lennar Corporation dropped its bid to buy a full city block in downtown Oakland near China Town, for a project that was to build 500 to 850 market-rate housing units. Because of the shift in Oakland towards implementing Inclusionary Zoning laws that may require developers to set aside around 15 to 20 percent of their market rate housing units as affordable housing, the Lennar Corporation felt uncertainty in the market, and pulled out.

Other developers felt great alarm by Lennar Corporation’s decision to pull out of the massive deal in Oakland. Fear and panic set in when the developers realized that they had outpriced themselves out of the market, while condo sales were plummeting like dead apples falling off a tree.

As an example, during the first 6 months of 2006, one local broker watched his sales plummet from 25 to 30 condo sales per month, to around 15 to 20 condo sales a month. As another example, by May of 2006, Green City Lofts in Oakland near Emeryville, sold only around 10 out of 62 condo units during the preceding 9 months, and the latest proposals for Inclusionary Zoning in Oakland, put a big fear in the heart of an industry seeking ever higher profit margins per year.

According to the Rent and Vacancy Survey of 2005, by the Rental Housing Association of Northern Alameda County (RHANAC), rents in Oakland jumped 8.5 percent during 2005, and vacancies declined by 2.3 percent. Developers hope that the high rents and low vacancy rates will eventually convince renters to switch to being condo owners.

Greg Mc Connell, and the Better Housing Coalition, fought against some of the recent Inclusionary Zoning proposals in Oakland, and it was this same group of profiteers who were behind the efforts to kill condo-conversion protections in Oakland.

It was uncertainty in the condominium market that spurred the latest battle in Oakland, after Mc Connell and Associates, with their friends in City Hall, who realized that condo-conversions is where the money is at. Less than 10 percent of Oakland’s renters would be able to afford a $350,000 to $400,000 condo-conversion, while thousands of renters would end up being displaced by the Better Housing Coalition’s greedy scheme.

The Better Housing Coalition did not reply to calls before the deadline of this story.

Lynda Carson may be reached at tenantsrule@yahoo.com

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