July 2020 SF Apartment Magazine by sfaa1917

SF APARTMENT magazine

THE NEW

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Compass is a real estate broker licensed by the State of California and abides by Equal Housing Opportunity laws. License Number 01527235. All materials presented herein is intended for informational Purposes only and is compiled from sources deemed reliable but has not been verified. Changes in price, condition, sale or withdrawal may be made without notice. No statement is made as to accuracy of any descriptions. This is not intended to solicit property already listed.

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SF APA magazine

SF APARTMENT

contents

Features

Capitalize with Compromise

by TERRENCE JONES

Dining Out Down the Line by PAM MCELROY

Role Remodels by JOSH LEVITAN

A Safe Let by PAM MCELROY

36 4

JULY 2020 | SF APARTMENT MAGAZINE

PARTM Columns

Membership

Bills & Ballots

Talk the Talk

The News

Surreal Estate

Legal Q&A

by VARIOUS AUTHORS

Rent Between the Lines

Sheridan Report

by JUSTIN A. GOODMAN

Fight or Flight by MATTHEW SHERIDAN

Calendar

Professional Services Directory

Membership Application

SF APARTMENT MAGAZINE | JULY 2020

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SF APARTMENT

San Francisco Apartment Association Office 265 Ivy Street San Francisco, CA 94102 Tel 415-255-2288 Fax 415-255-1112 Email sfaa@sfaa.org

Web www.sfaa.org

SFAA Staff Executive Director Janan New

Deputy Director Vanessa Khaleel

Education Specialist Stephanie Alonzo Member Services Manager Maria Shea

Government and Community Affairs Charley Goss

Accountant Crystal Wang

SFAA Officers President Chris Bricker

Vice President Robert Link Treasurer Jim Hurley

Secretary Mark Henderson

SFAA Directors Eric Andresen, Honor Bulkley, Andre Ferrigno, David Gruber, Kent Mar, Neveo Mosser, J.J. Panzer,

VOLUME XXXIII, NUMBER 7 JULY 2020 Published by Hippo Productions Publisher Vanessa Khaleel Editor Pam McElroy

Art Director Jéna Safai

Production Manager Cameron Shaw Tel 415-392-3770

Web www.sfaa.org SF Apartment Magazine (ISSN 1539-8161) Periodicals Postage Paid at San Francisco, California. POSTMASTER: Send address changes to the SF APARTMENT MAGAZINE, 265 Ivy Street, San Francisco, CA 94102. The SF Apartment Magazine is published monthly for $65 per year by the San Francisco Apartment Association (SFAA), 265 Ivy Street, San Francisco, CA 94102. The SF Apartment Magazine is not responsible for the return or loss of submissions or artwork. The magazine does not consider unsolicited articles. The opinions expressed in any signed article in the SF Apartment Magazine are those of the author and do not necessarily reflect the viewpoint of the SFAA or SF Apartment Magazine. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting or other professional services. If legal service or other expert assistance is required, the services of a competent person should be sought. Acceptance of an advertisement by this magazine does not necessarily constitute any endorsement or recommendation by the SFAA, express or implied, of the advertiser or any goods or services offered. Published monthly, the SF Apartment Magazine is distributed to the entire membership of the SFAA. The contents of this magazine may not be reproduced without permission. Publisher disclaims any liability for published articles. Printed by Jostens Printing Co. Copyright @2020 by SFAA.

Bert Polacci, Dave Wasserman

SF APARTMENT MAGAZINE | JULY 2020

COLUMN

THE NEWS

Board of Supervisors passed the COVID-19 Tenant Protection Ordinance, which makes permanent the city’s temporary moratorium on evictions for nonpayment of rent due to COVID-19. While eviction is always a housing provider’s last resort, it’s an important part of enforcing a tenant’s obligation to pay rent. In prohibiting evictions for nonpayment of rent due to COVID-19, the ordinance would force housing providers to try to collect unpaid rent through a small claims court/civil action or through a collections agency, and the

Bills & Ballots

Keep up with ever-changing COVID-19 legislation and the quickly approaching 2020 election. Editor’s Note: State and Federal guide-

additional time to respond to unlawful

lines and legislation are constantly

detainer actions.

reality is that most landlords would never be able to recoup lost rent. SFAA, the Coalition for Better Housing, and the San Francisco Association of Realtors are sponsoring a lawsuit against the ordinance. The lawsuit will be filed immediately once the ordinance gets approved into law. For information on locally imposed

changing regarding COVID-19 and the shelter-in-place order. For the latest

In early June, the Judicial Council

eviction moratoria, visit sfaa.org or

information, resources, financial aid,

was scheduled to vote on whether

caanet.org.

and forms, visit www.sfaa.org or www.

they should end their emergency rules

caanet.org/coronavirus.

prohibiting new unlawful detainers

Senate Bill 1410

from being filed. The Council can-

COVID-19 Related Eviction Moratoria

A CAA-sponsored bill that would

celled their vote, and indicated that

help landlords recover rent lost to the

they would instead like to see the

COVID-19 crisis—while also guarding

Governor Gavin Newsom extended

state legislature and Governor come

tenants against mountains of rent debt—

an executive order from March 16 that

up with a policy solution.

has passed its first hearing. The Senate Housing Committee on Wednesday

cleared the way for local governments to enact COVID-19 related eviction

As of the publishing of this article (in

approved SB 1410 by Sen. Anna Cabal-

moratoria. The order will remain in

mid-June), the Judicial Council was con-

lero (D-Salinas) and Sen. Lena Gonzalez

effect through July 28. Most locally

sidering lifting its ban on new evictions

(D-Long Beach), on a 10-0 vote.

to expire at the end of June. With that

The federal eviction moratorium for

“SB 1410 is critical to the financial secu-

order now renewed, local eviction

properties that are financed by feder-

rity and well being of California’s renters

moratoria that were tied to the order

ally backed mortgage loans or that

who by no fault of their own, lost or had

also will remain in place.

participate in federal affordable hous-

significant reductions in their incomes

approved eviction moratoria were set

ing programs, including properties

as a result of this pandemic,” Caballero

While Newsom extended his March 16

with Section 8 housing vouchers, also

told the committee.

executive order, he allowed a second

remains in effect until late June. The COVID-19 Emergency Rental As-

executive order on evictions to lapse.

This second order, made March 27,

In June, despite hearing from hundreds

sistance Program would apply to ten-

allowed COVID-19 affected tenants

of SFAA members, the San Francisco

ants who can demonstrate an inability

JULY 2020 | SF APARTMENT MAGAZINE

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SF APARTMENT MAGAZINE | JULY 2020

to pay rent due to COVID-19. To qualify,

The above content was provided by the

SFAA Updates

their landlords also would need to agree

California Apartment Association.

The SFAA 2020 lease is now available. For

to participate in the program and accept certain conditions.

Assembly Bill 1938 Assembly Bill 1938—a bill that would ban

a hard copy or to gain online access to the SFAA 2020 lease, visit sfaa.org and select the “Resources” tab.

The state of California would make

Michael Weinstein from using money

direct rental payments to landlords

from his taxpayer-funded AIDS Healthcare

Annual SFAA Trade Show has been re-

for up to three months and cover 80% of

Foundation to fund the Rental Affordabil-

scheduled to September 3, 2020 at the

rent that’s gone unpaid because

ity Act—has passed in the Assembly. The

Fort Mason Center. Attendees will learn

of the pandemic.

legislation would limit political spending

all about the latest trends, products and

of these funds to health care issues. AB

services in the multifamily housing indus-

To receive these dollars, landlords would

1938 was introduced by Assemblymembers

try. Consult with legal and management

need to agree to the following:

Evan Low (D-Campbell) and Susan Eggman

professionals, get to know service provid-

(D-Stockton); Senator Scott Wiener is the

ers, improve your overall effectiveness

principal coauthor.

at the free educational classes, and meet

• Not increasing rent for the unit for

peers in the San Francisco rental property

a specified period. • Not charging late fees for the past due rent paid by the program. • Not pursuing any remaining rent owed for the months paid by the

The measure, also dubbed Prop. 10 2.0,

market. The event is free and open to the

would weaken Costa Hawkins, allowing

general public, so bring your friends and

cities and counties to impose rent control

enjoy! For more information on the trade-

however they choose—even below the

show or to become a sponsor, contact

rate of inflation—on buildings fifteen

vanessa@sfaa.org.

years or older. The SFAA Rent Forbearance Form and in-

program. Debra Carlton testified in support of the

formation on temporary rent reductions are

As eviction moratoria expire,

bill, saying, “The COVID-19 pandemic

available at www.sfaa.org.

SB 1410 would help keep struggling

has stretched the state’s health-care

renters housed while also providing

system to its limits, making it even more

SFAA classes will be available online

greater financial stability for rental

imperative for public health care dollars

during shelter-in-place. The San Fran-

property owners.

in the state to be spent now, and in the fu-

cisco Apartment Association is happy to

ture, on health care. These dollars should

announce that current CCRM students

“We all know that eviction is a big

go to patients—not be spent to influence

can continue their education during the

concern once the courts open, and we

or fund local and state ballot measures or

Shelter-in-Place right from home. We un-

desperately need to find dollars to help

unrelated litigation that

derstand keeping up education is crucial

owners and tenants,” Caballero said.

exacerbates the state’s continuing health

and want to assist our members to stay up

“Given that in the past two years that

crisis and housing crisis.”

to date. Thus we will be setting up more webinars in the future. See the calendar

we have spent hundreds of millions of

on page 48 for a full list of classes.

dollars to try to house the homeless, the

California voters will decide whether or not

last thing we need now are hundreds of

to pass the Rental Affordability Act on the

thousands of renters all over the state of

November ballot. CAA and SFAA are pre-

The SFAA office will remain closed during

California that become homeless because

paring another campaign to prevent radi-

the shelter-in-place mandate. However,

of this pandemic.”

cal rent control and vacancy control from

SFAA staff is working round-the-clock to

becoming law and further exacerbating the

keep the nonprofit running. Timely pay-

state’s homelessness crisis.

ment of membership dues is necessary to

While other rental-relief proposals are

help the association help you.

circulating at the Capitol, they have longer timetables and would take years to com-

The cost of the campaign battle will be

pensate landlords for lost rent.

around $70 million. Ultimately, the ask to

San Francisco Property Taxes

fund the campaign is $100 per unit owned

The San Francisco Property Tax deadline

“It’s the only state proposal that we know

or managed; however, we know rental

was extended to May 4. Taxpayers who

of that would bring rent money sooner

property owners are suffering losses

have been unable to pay property taxes

rather than later,” Debra Carlton, CAA’s

due to COVID-19 and may not be able to

due to COVID-19 should fill out the pen-

executive vice president of state public

contribute the full amount at this time.

alty waiver form to request that late fees

affairs, said of SB 1410. “If this bill does

Anything helps though, so even small

be waived. To access the penalty waiver

not go forward, there is nothing available

donations at this point will go a long way.

form, visit sftreasurer.org, and select the

for tenants and landlords at this time. This

Please go to www.SFRH.org or www.sfaa.

“Business” tab.

can’t be the answer.”

org for additional information.

JULY 2020 | SF APARTMENT MAGAZINE

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Adam Filly Senior Vice President | m: 415.516.9843 | adam@adamfilly.com DRE 01354775 | www.AdamFilly.com Compass is a real estate broker licensed by the State of California and abides by Equal Housing Opportunity laws. License Number 01527235. All material presented herein is intended for informational purposes only and is compiled from sources deemed reliable but has not been verified. Changes in price, condition, sale or withdrawal may be made without notice. No statement is made as to accuracy of any description. All measurements and square footages are approximate. This is not intended to solicit property already listed.

SF APARTMENT MAGAZINE | JULY 2020

COLUMN

SURREAL ESTATE

Rent Between the Lines w r i t t e n b y J U S T I N A . G O O DM A N

The COVID-19 pandemic has been an interesting study in public health and market regulations.

emergency declarations indefinitely, without legislative renewal. Usually, the local health officer declares the emergency, and the Board of

hen I titled this col-

powers collapse timing to a singularity.

Supervisors has the authority to revisit

umn “Surreal Estate,”

This column looks at the propriety of

and extend the declaration. The differ-

I meant to playfully

rulemaking that exists outside normal

ence here is a political one. Instead of

evoke some of the

space and time.

making findings to affirmatively renew a declaration, the Board of Supervisors

unusual laws and market strategies that emerge in one of the nation’s hottest—

Of course, space and time mean nothing

now had to vote to end it. Efficiency is

and most heavily regulated—residential

to you now. Your weekends are week-

anathema to separation of powers, but at

rental markets. I didn’t anticipate a wave

days are weekends. Your cellphone

least all the same decision makers were

of COVID-19 laws, regulations, proc-

eliminated your office hours. Your alarm

involved. But San Francisco lawmakers

lamations and emergency orders that

is incessantly snoozable. Zoom “locates”

now had the go-ahead to enact laws un-

made the head of every San Francisco

you to the destination of your choos-

der the “emergency ordinances” section

rental law practitioner spin. We’ve never

ing… which is probably not in front

of the San Francisco Charter. Emergency

had to adapt so quickly.

of the pile of laundry on top of your

ordinances require only one reading

unmade bed. Your Schrödinger’s kids

by the Board of Supervisors (instead of

Thanks to some bold choices by Gov-

are simultaneously in school and out of

two), and they take effect immediately

ernor Newsom, Mayor Breed, and Pre-

school. To tell this story, I need to take

(instead of 30 days after passage).

siding Judge Wong, San Francisco has

you back to the time just before it was

weathered this relatively well. “Flatten-

always five o’clock everywhere.

Meanwhile, the California Judiciary took extraordinary steps to safeguard

ing the curve” never meant “obliterating the problem”—it only meant that we

Normal time existed until Gov. New-

its litigants and its staff. Chief Justice

were marshalling our resources to serve

som declared a state of emergency

Cantil-Sakauye authorized, and Presid-

our most vulnerable, while keeping as

on March 4. The declaration initiates

ing Judge Wong adopted, a stay of all

many of us as safe as possible for what

anti-price-gouging regulations, which

unlawful detainers through June 19.

comes next.

prevent increasing rental housing

Court holidays applied to other cases

prices above 10% for 30 days. (Some

through June 1.

In the meantime, your faithful SFAA-

have waited patiently to serve Costa-

affiliated attorneys have been work-

Hawkins increases since last year’s

This patchwork still allowed evictions

ing overtime, undaunted, to keep you

statewide fires, only to watch them col-

based on violence, threats of violence, or

ahead of the changes in law. Shelter-

lide with the Penal Code again.)

health and safety issues to go forward, until the Judicial Council of California

in-place doesn’t stop Dave Wasserman

governments to extend their state of

from leading virtual legal Q&A panels

Gov. Newsom supplemented his dec-

(the rulemaking arm of the judicial

via Zoom. And these updates are more

laration on March 16, to invite local

branch) ordered several critical changes,

important than ever. While tenants’

moratoria on non-payment evictions

preventing defaults, extending unlaw-

obligations are suspended, landlords’

and to extend the eviction prohibi-

ful detainer trial setting, and withhold-

violation of tenant protection laws are

tions through May 31. On March 27,

ing summonses for evictions other than

not—the standard is high.

he extended the time to respond to

those “necessary to protect public health

non-payment evictions by 60 days, and

and safety.” (A summons is a command

My last column was about how lawmak-

suspended enforcement of writs of

for the defendant to submit to a court’s

ers could regulate timing and procedure

possession in eviction cases through

jurisdiction. Without it, a lawsuit can be

to control substance. But emergency

May 31. Significantly, he allowed local

filed but not prosecuted.)

JULY 2020 | SF APARTMENT MAGAZINE

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Compass is a real estate broker licensed by the State of California and abides by Equal Housing Opportunity laws. License Number 01527235. All material presented herein is intended for informational purposes only and is compiled from sources deemed reliable but has not been verified. Changes in price, condition, sale or withdrawal may be made without notice. No statement is made as to accuracy of any description. All measurements and square footage are approximate.

Over the weeks these laws were passed,

place. The implementation was wrong,

Then there’s Mayor Breed’s eviction mora-

it was a part-time job just keeping up with

but the result may have been inevitable.

torium, which achieves its substantive eviction defense goals through time-dilation. It

what they said. We now have a bit of space to consider whether they’re enforceable.

And then there’s San Francisco, which

is well-settled that cities may regulate the

exists in its own universe sometimes.

substantive grounds for evictions, but they

The California Emergency Services Act

Proposed legislation from Sup. Preston

may not regulate the procedural protec-

gives extraordinary powers to the various

would forever prevent a landlord from

tions of the state law unlawful detainer stat-

branches at the state and local level. Gov.

evicting a tenant for failure to make a

utes, which control the timing of three-day

Newsom may declare a state of emergency

rent payment that came due during the

fault-based notices or sixty-day non-fault

with immediate effect. His emergency

statewide eviction moratorium. SFAA

notices, followed immediately by a lawsuit.

regulations may extend price gouging

and other trade groups wrote Mayor

rules and suspend statutes. And this was

Breed, questioning what authority San

SFAA recently litigated this issue, chal-

how he implemented the emergency rental

Francisco had to deprive landlords of

lenging San Francisco’s “educator”

regulations: he extended the prohibition

their state procedural protections to

defense to non-fault evictions. The law

on evicting in order to “price-gouge” and

collect unpaid rent via an unlawful de-

prevents a notice from expiring during a

he suspended the time a tenant had to

tainer. So far, no response.

school term, if the household has a minor child or an educator.

respond to a nonpayment-of-rent eviction (generally five days, extended to sixty days

The city took a more subtle approach to

during the order).

the rate of rent. Mayor Breed signed the

The Court of Appeal noted the “shadowy”

ordinance on April 24 with immediate

line between procedure and substance,

The Judicial Council rules are less sound.

effect. It says that any rent increase im-

likening the educator defense to other “pro-

It has constitutional authority to make

posed from April 7 through the end of the

tected tenant” defenses (like age or disabil-

rules and statutory emergency powers to

local eviction moratorium is suspended.

ity), and deciding the educator defense was

declare court holidays (like Gov. Newsom

Foundational cases on rent control re-

substantive. It contrasted this result with a

did) to prolong the last day for a party to

quire ordinances to allow rental rates to

hypothetical “procedural” regulation, given

do something. But this is clearly not what

grow with inflation. Ordinances that froze

that “an ordinance limiting the timing of all

the Judicial Council did. The unlawful de-

rents were “confiscatory” and invalid.

evictions would appear to be preempted by

tainer statutes command that “a summons

Technically, this is not freezing the rate,

the unlawful detainer statutes.”

shall be issued” upon the filing of a com-

only delaying when landlords can expect

plaint; that once a tenant is served with a

the increase. It’s still wholly improper,

This year, the fall term commences on Au-

complaint and does not timely respond,

but it effects tens of dollars at a time

gust 17. But the moratorium is a defense for

the clerk “shall enter the default of any de-

when many tenants are demanding

eviction notices that expire before August

fendant so served”; and that trial “shall be

outright rent forgiveness. The most

30. This well-meaning law wants to cre-

held not later than the 20th day” after the

troubling part of this legislation is the

ate an eviction defense for San Francisco

request. The Judicial Council is prohib-

ante-dating to April 7 (the date it was

citizens, all of whom are presumed to be

ited by the Constitution from changing

introduced). Emergency ordinances are

sheltering-in-place because of COVID-19.

statutes like this, and no emergency pow-

effective the day they’re signed, but the

Indeed, the city would characterize this

ers change that.

Board of Supervisors cannot procedurally

as a substantive defense for a new class of

time travel.

susceptible people. Shadowy though the line may be, it is difficult to characterize

The Judicial Council issued these rules because Gov. Newsom invited it to. His

The retroactivity calls to mind the 1999

this regulation as substantive when it now

March 27 order essentially delegated the

“Leno Amendment,” challenged in Danekas

prevents owners from recovering their

power to make “rules” (which the Judicial

v. CCSF. The law eliminated evictions for

property for all of 2020, if their tenant hap-

Council may do) that supersede “statutes”

subletting if the new roommate was a

pens to have a child or educate one.

(which even Gov. Newsom can’t do, with-

“one-for-one” replacement. The Court of

out the legislature).

Appeal determined the amendment did not

The pandemic has been an interesting proj-

improperly impair contracts, because land-

ect in public health and market regulations.

Separation of powers shouldn’t be taken

lords were on notice of frequent changes in

Our industry has patiently partnered with

lightly. But as a practical matter, these

this heavily regulated industry, and because

regulators and tenants to work together

changes only alter timing that the Judicial

“the ordinance and the regulation have no

to get through this. It will be interesting to

Council could have regulated anyway. For

direct effect on the rent received by the

see how the courts interpret these unprec-

instance, if the rules extended the time

landlord.” Applying that reasoning here,

edented changes in law. For now, we hope

to respond to a complaint, by declaring a

landlords of course wouldn’t be surprised

you are staying safe and sane.

term of judicial holidays, the clerk cannot

to see this regulation, but it certainly affects

be asked to take the default in the first

the rent they receive.

JULY 2020 | SF APARTMENT MAGAZINE

Justin A. Goodman is with Zacks, Freedman & Patterson, P.C. and can be reached at 415-956-8100.

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SF APARTMENT MAGAZINE | JULY 2020

COLUMN

LEGAL Q&A

Talk the Talk w r i t t e n b y VA R IOU S AU T HOR S

Businesses have suffered severe economic impacts as a result of COVID-19. Commercial landlords should make a serious attempt to come to a mutually agreeable rent repayment plan. notice of the violation (“Notice of DeQ. A commercial tenant has

not been able to pay rent since closing their doors in March. This business has otherwise always paid rent on time, and I would like to work with them as best I can. What are my legal obligations?

A. On March 18, 2020, the Mayor of

ant with a Notice of Default on June 5. The tenant has until July 5 to either (i) pay the rent OR (ii) provide objectively verifiable documentation to you stating its inability to pay the rent due to the financial impacts of CIVID-19. Upon submission of this documentation, the cure period is automatically extended to August 5. At the end of this thirty day period, your tenant may then obtain additional extensions through December 5 in order to repay June rent.

fault”) and an opportunity to cure the default. The Notice of Default must spec-

This rule applies to leases on fixed terms

ify a cure period of at least one month,

as well as to holdover and month-to-

although the Order encourages land-

month tenancies. “Rent” means all pay-

lords to offer a longer period. Upon re-

ments the tenant is required to pay the

ceipt of the Notice of Default, the tenant

landlord, including monthly base rent,

will have the cure period to either pay

CAM charges, NNN reimbursements,

the rent or provide documentation to

and security deposit installments. No

San Francisco issued an Emergency

the landlord showing that the tenant is

late fees or other charges may be tacked

Order (the “Order”) that implemented

unable to pay the rent due to a financial

on unless the operative lease agreement

a temporary moratorium on evictions

impact related to COVID-19. A financial

that was entered into before the Order

for commercial tenants who are unable

impact is deemed related to COVID-19 if

allows for these assessments.

to pay rent due to COVID-19. However,

caused by the COVID-19 pandemic or by

the Order only applies to commer-

any local, state, or federal government

Bottom line: Work with all of your

cial tenants with gross receipts of $25

response to COVID-19. If the tenant

commercial tenants to attain a rent

million or less in 2019. Nothing in the

provides the landlord documentation

payment schedule. Almost all busi-

Order relieves the tenant of the obliga-

of the tenant’s inability to pay rent due

nesses have suffered severe economic

tion to pay rent, or restricts the ability

to a financial impact related to CO-

impacts as a result of this crisis. Do not

of the landlord to recover rent due, but

VID-19, then the cure period is further

get hung up on document verification;

the Order does prevent the landlord

extended by one month. Subject to

rather, make a serious attempt to come

from being able to file for eviction if

submission of updated documentation

to a mutually agreeable repayment

the tenant qualifies for relief under

each month, for a period not to exceed

plan in accordance with the guidelines

the eviction moratorium. As such, you

six months after the rent was originally

set forth in the Order.

can always bring a non-eviction action

due, the tenant may obtain additional

against your tenant for breach of the

monthly extensions of the cure pe-

—David Wasserman &

lease contract, but utilizing such a tac-

riod. The cure period requirements

Denise A. Leadbetter

tic may not be advisable if you want to

survive the expiration or termination of

keep the tenant in business.

the Order, which now expires on June 17 (the “Expiration Date”).

So if a covered commercial tenant fails

You then decide to provide the ten-

to make a rent payment that was due

For example, assume that June 2020

after the issuance of the Order, you are

rent, due on June 1 and therefore pre-

required to provide the tenant written

dates the Expiration Date, is not paid.

JULY 2020 | SF APARTMENT MAGAZINE

I’d like to start collecting no-contact rent payments electronically. Is this something I can enforce with notice? Legal Q&A… continued on page 60

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COLUMN

SHERIDAN REPORT

Fight or Flight w r i t t e n b y M AT T H E W C . S H E R I DA N

With the success of telecommuting, will renters flee San Francisco?

out the storm and be with family. Many may be gone forever.

Staggering Job Losses In San Francisco, the severity of the

y late May, a sharper pic-

to the city when the housing market

economic impact caused by COVID-19

ture of the enormous im-

corrects and rents fall. Now, with the

has been severe; over 100,000 peo-

pact of the COVID-19 crisis

ramifications of commuting, will the city

ple filed for unemployment over the

emerged and the damage

experience a resurgence of workers who

months of March and April. Prior to

the pandemic has wreaked upon San

want to live near their jobs and embrace

March—before the shelter-in-place regu-

Francisco’s economy: massive job

the joys of living in vibrant neighbor-

lations were imposed—San Francisco’s

losses, shuttered businesses, enormous

hoods? Or will employers ramp up their

initial unemployment claims averaged

city budget deficits, and a rental market

exodus to suburban communities with

3,190 per month over the previous year.

that is already taking a hit. While Mayor

better schools and quality of life and

In March, as the restrictions on move-

London Breed outlined a detailed

affordable housing? But with remote

ment and commerce were instituted,

phased reopening of specific sectors of

work—does it even matter?

the numbers of claims exploded to 44,306. By April, new claims for that

commerce—much to the relief of business owners and workers—the modifi-

Thanks to newly embraced remote-work

month alone rose to 57,537. These fig-

cations to employment, lifestyles and

options, Redfin is predicting a flight

ures only represent new “initial” filings

habitation brought about by the virus,

from expensive coastal cities of people

for benefits. Actual reported job losses

as well as the shelter-in-place order,

moving to entirely new cities or even

were equally devastating.

could become permanent.

just relocating farther out from metro areas. “Redfin is preparing for a seismic

By late May, California’s Employment

With the apparent success of telecom-

demographic shift toward smaller cit-

Development Department reported

muting, many businesses are beginning

ies,” stated Redfin CEO Glenn Kelman.

that the unemployment rate for the

to question the practicality of remain-

“Prior to this pandemic, the housing

San Francisco Metro Division, which

ing in urban core cities like San Fran-

affordability crisis was already driving

includes San Mateo and San Francisco

cisco in light of high operating cost,

people from large cities to small.” The

counties, dramatically increased to

expensive housing, long commutes, and

internet-based real estate brokerage

12.1% in April, up from a revised 3.0%

blighted neighborhoods impacted by

firm surveyed users on remote work

in March. California’s overall unem-

severe homelessness. Twitter recently

habits and rising wariness about close

ployment rate stood at 16.1% in April.

announced that most of their workforce

quarters. More than 50% of respondents

would be allowed to work from home

from the San Francisco metro area said

The San Francisco MD shed 165,800

permanently after the restrictions from

that they would consider moving away

jobs in April over the previous month—a

the coronavirus are lifted.

if they were able to work remotely. The

monumentally historic loss. Industries

survey revealed some will choose to

hardest hit were those deeply entwined

As long as there is no vaccine and the

work virtually from a small town, per-

with the city’s economy and culture: lei-

virus remains virulent, most residents in

haps where their parents still live. “The

sure and hospitality (down 69,600 jobs)

the Bay Area will avoid the risk of com-

whole narrative of the past 200 years,

and food services and drinking places

muting on BART or Muni. Before the

of the young person moving to the big

(down 51,400 jobs)—the two combined

crisis, the transit systems were operating

city, may turn a little upside down in the

categories accounted for about roughly

beyond capacity. Train cars were consis-

years ahead,” said Mr. Kelman.

three-fourths of the total job reduction. Trade, transportation and utilities re-

tently overcrowded, while stations were

Francisco, heading back “home” to ride

filthy, and fares were pricey—at least for

Anecdotal evidence already points to

ported a drop of 27,100 jobs, while pro-

BART. With its boom and bust history,

this occurring in San Francisco, with

fessional and business services suffered

San Francisco has always seen a resur-

many owners reporting vacancies aris-

gence of folks returning or migrating

ing from tenants up-and-leaving San

JULY 2020 | SF APARTMENT MAGAZINE

Sheridan Report… continued on page 40

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CAPITALIZE with COMPROMISE written by

T E R R E NC E JO N E S

With the future unclear for office and retail in San Francisco, both commercial tenants and buildings owners benefit from negotiating rents. Most residential tenants in San Francisco have been stepping up and paying their full rent during the Covid-19 crisis. We have also seen layers of financial support come in for residential tenants, beginning with the $1,200 stimulus checks that started to arrive in April. However, in the same month, many tenants were affected by the massive layoffs in the hotel industry, retail stores, and service businesses like nail salons and restaurants. A large number of these now laid-off tenants only recently got their first unemployment checks. Despite all of this, the net result for many tenants in San Francisco is that they have been able to pay their rent. At this point in mid-June, the shelter-in-place order is starting to lighten up, and some tenants are returning to work. So, it’s likely that most renters will continue to pay their rent. According to Government and Community Affairs Director Charlie Goss at the San Francisco Apartment Association, “The May owner survey results backed up the general consensus that most residents were paying rent. However, the commercial situation is not quite as cheery. Out of 400 commercial units the survey covered citywide, we saw the following: 57% (231 total) of commercial tenants were unable to pay rent for May. 20% (12 total) of respondents have had commercial tenants permanently close their business, break their lease, or unexpectedly give Notices to Vacate due to COVID-19. 19% (10 total) are granting across-the-board temporary rent reductions for their commercial tenants. 24% (55 total) of respondents do not believe they will ever be able to recoup lost rent. In the Financial and Union Square districts, we saw that plywood went up on windows and doors were locked when the shelterin-place order (SIP) was declared on March 16. Many hotels, the Disney store and Morton’s steak house were boarded up. No one was getting on a plane and coming to San Francisco for trade shows. SF Travel is funded by the hotel tax and facilitates corporate travel and hotel stays around trade shows at the Moscone center. SF Travel laid off 60% of its staff and they don’t expect to rehire anyone until January 2021. A client of ours has had his rent payments suspended by Applebee’s. Applebee’s instituted a 3-month rent hiatus through their force majeure lease clause. This may or may not work and some building owners are fighting it in court. Even Starbucks is asking for rent reductions from all of its landlords. According to a Wall Street Journal article from May 19, 2020, “…in a Starbucks letter, which was reviewed by the Wall Street Journal, an executive said the company ‘will require concessions to support modified operations and adjustments to lease terms and base rent structures, so we can withstand this uncertainty

JULY 2020 | SF APARTMENT MAGAZINE

SF APARTMENT MAGAZINE | JULY 2020

SENATE BILL 939 Proposed Senate Bill 939 would allow small businesses that have been impacted by the shelter-in-place mandate to renegotiate and modify leases in good faith. If a tenant and landlord can’t reach a “mutually satisfactory agreement” within 30 days, the tenant can break the lease without penalty. The bill also makes it illegal for a landlord to terminate a tenancy until one year after California’s COVID-19 emergency order expires. Specifically, the bill covers small businesses that have lost more than 40% of revenue or that will have to operate with stricter capacity limits due to social distancing restrictions. The bill does not include publicly owned companies or their businesses. The bill was co-authored by Senator Scott Wiener, who said the bill is to prevent “a mass extinction event of small businesses and nonprofits… We must take steps to stabilize these businesses.” Those opposed to the bill argue that the financial burden is unfairly and unreasonably being moved to landlords. The bill would expire in December 2021, or two months after the state’s COVID-19 emergency order expires, whichever comes first.

on YouTube are increasing almost expo-

I created several unique tenant categories

nentially. Even Supervisor Aaron Peskin,

to help understand and demonstrate the

a SFAA member, sees the rough situation

situation better.

with retail tenants in San Francisco. He has suggested the city suspend the Com-

“Gold” Tenants—These are tenants who

mercial Vacancy Tax that he co-authored

have been operating at 100% during the

himself and was voted in by San Fran-

shelter-in-place. They are maybe doing

cisco voters just last November.

even better during the pandemic than they were before it hit. Tenants like Home

So, what is important in this environment

Depot, Lowes, Costco, CVS, Walgreens,

to owners with non-residential units?

Trader Joe’s, Safeway, Whole Foods, BevMo, cannabis outlets, and neighbor-

Insurance is important—The absolute

hood markets have been flourishing. In

number one thing owners need to stay

the last two months, people have been

on top of is maintaining their property

prepping for the end of the world by stock-

insurance policies. The recent fire at

ing their pantries, buying cases of wine

Pier 45 is an example of how a building

and other alcohol, and purchasing freezers

can be completely destroyed when you

and filling them up.

least expect it. Currently, there are many people living on the streets. The city of

“Silver” Tenants—Like mushrooms that ap-

San Francisco’s politicians have chosen

pear after the rain, this is a group of tenants

to attract and support a vagrant homeless

that will be very quick to come back to life.

group of people who live on the edge of

Medical doctors, dentists, dialysis treatment

society. The cause of the massive fire at

centers, veterinarians, physical therapists,

Pier 43 is still under investigation, but the

optometrists, insurance agents, CPAs, book-

initial rumors are that the fire was related

keepers, and lawyers all have strong busi-

to transients who were camping on site.

ness in good times and bad times. These

It is very difficult for owners to stop them

types of tenants are often well funded,

from occupying the nooks and crannies

have reserves in their bank accounts, bank

of their buildings (front door stoops, for

credit lines, and have a recurring collection

example). If a drug-addled or mentally

of clients in need of their services. Many

ill homeless person starts a fire and your

of these businesses have been considered

building is destroyed or damaged, your

essential and have been open during the

only real remedy is through your insur-

SIP with minimally interrupted cash flow.

ance coverage.

Some of these tenants might have problems for now, but for the most part, they will pay

Occupancy is important—When a prop-

their rent and go right back to work as soon

erty is occupied with a tenant, there is

as they get the all-clear.

a sense of mutual benefit; what is good for the tenant is also good for the owner.

“Bronze” Tenants—These are businesses

together.’ Many landlords privately fumed

When businesses are open, those tenants

for which the recovery is less certain and

over this request, even though Starbucks

keep an eye on the street and the owner’s

they may not be able to come back as fully

paid its rent in full for April and May at

building. The city has been citing owners

functioning San Francisco businesses.

most of its stores. A company with an $86

who have been tagged by graffiti. This is

Hair salons, nail salons, restaurants, psy-

billion market capitalization should be able

less likely to happen to buildings with ac-

chiatrists, physical therapy, chiropractors,

to raise debt or more equity in the capital

tive businesses, with tenants (and custom-

real estate agents, and massage therapists

markets, enabling it to meet its obligations,

ers) who keep taggers away.

are less likely to have a lot of cash reserves. Their operations have typically been

these landlords said.” But in these uncertain times, how are own-

touch-and-go over the past few years and

Amazon has encouraged all of its employ-

ers handling requests for rent reduction,

they survive month-to-month, as long as

ees who can work from home to do so un-

abatement, non-payment, and tenants who

the clients keep coming. Many of these

til October. As of now, service businesses

are closing their shops and businesses?

businesses have been having a tough time

like barbers and nail salons have all been

Charlie Goss said, “Owners are being pro-

operating in San Francisco due to high

closed for 60 days. The number of home

active and open to working with their ten-

haircut and manicure instruction videos

ants when they can.”

JULY 2020 | SF APARTMENT MAGAZINE

Capitalize with Compromise… cont. on page 44

As the curve flattens we would like to thank all the front line workers who have sacrificed so much during these troublesome times. San Francisco’s #1 Apartment Broker 724 Battery Street | 415.890.0704 compass-cre.com | San Francisco | Los Angeles

SF APARTMENT MAGAZINE | JULY 2020

Dining Out Down the Line written by

PA M M C E L ROY

San Francisco restaurant investor and owner Laurie Thomas discusses what the new normal for dining out could look like in San Francisco. What started as a personal love of food and a side business venture as a restaurant investor turned into a full career for Laurie Thomas, owner of Nice Ventures, which owns and manages Rose’s Café and Terzo, in San Francisco. Thomas is also the executive director of the Golden Gate Restaurant Association, serves on the board of SF Travel and as an honorary board member for Meals on Wheels of San Francisco, and is a member of the newly convened San Francisco Economic Recovery Task Force. Thomas sat down with SF Apartment Magazine to discuss the future of dining out in San Francisco. Our exclusive interview, edited for space and clarity, begins below.

Q. What are the biggest challenges owners of commercial spaces face in the coming months? A. The ability for the commercial tenant to pay the rent. This means negotiating rents with tenants is key. In San Francisco, restaurant tenants aren’t allowed to do anything but takeout and delivery until June 12 when restaurants will then be allowed to open to seat patrons outside only. As of May 28, San Francisco announced that city restaurants will not be allowed to seat inside their restaurants until at least July 13! This is devastating news for both landlords and tenants. Once the restaurants can open, they will experience a significant decrease in revenue, because we expect that, due to social distancing constraints, they will only be able to seat about 30% - 40% of their seats—resulting in revenue losses of 60% - 70%. Entertainment venues and bars may have to stay dark until at least mid-August. Restaurants downtown—SOMA, Moscone, Union Square— who depend on tourism and the daily workforce, are talking about not even opening until late fall or January 2021. To add to this, we are hearing that some first quarter conventions are looking to move their dates out until later in 2021, which will only worsen the problem. A recent survey by The Bay Area Council indicates some tech companies are planning to let most of their employees work remotely indefinitely, or they plan on bringing back only limited staff for a long time. This will severely impact restaurants who rely on corporate catering and lunch business. I’d hope that landlords of commercial properties would consider their commercial tenants as their business partners right now and work together to help ensure they will continue to have their existing tenants occupy the space.

JULY 2020 | SF APARTMENT MAGAZINE

SF APARTMENT MAGAZINE | JULY 2020

What are the biggest challenges restaurant owners specifically will face in the coming months?

A. As of right now, San Francisco restaurants cannot open for inside seating until at least July 13. Restaurants have already lost a lot of revenue. Most are still completely closed. A restaurant that stays closed, opens to 30% capacity, or even opens to 75%

As far as inside, I don’t believe buffet-

A. Not yet as indoor seating is not yet al-

style dining will be allowed period. And

lowed in San Francisco. Same for consumer

bar seating and usage will probably also

confidence—we’ll have to see what hap-

be prohibited for a while, but may be al-

pens once we can resume seating inside.

lowed if partitions are permitted.

We might start seeing additional practices

Q. What best practices do you

put in place as the outside dining will be

suggest restaurants put in place before reopening?

A. I think disposable paper menus are

permitted June 12.

Do you predict design or style trends to emerge after restaurants adjust to life after COVID-19?

capacity, all will face significant financial

a must, or QR codes to view menus by cell

losses. They face cash negative positions

phone. If a restaurant decides to go with

where previously agreed upon rents won’t

A. Yes, outside seating areas are going to

laminated menus, then the menus will

be a hot commodity—and should increase

be payable, and if not negotiated, will

have to be cleaned and sanitized between

the value of a restaurant space lease. I also

contribute to the restaurant owners con-

each use.

expect new locations to consider building

sidering filing for Chapter 11 bankruptcy

in more “separated” dining areas—perhaps

restructuring. Once this filing is made in

The California Department of Health

dining “cubbies” of some sort. Additionally,

the court, it immediately freezes any lease

and San Francisco Department of Health

restaurants will design a separate entrance

payment obligations.

have implemented plans for reopening to

area and exit area for to-go/delivery. Take

prevent the spread of COVID-19 in restau-

out windows might become common,

Other big challenges are the wellbeing of

rants. Some of the steps include: not pre-

even in full service restaurants. Of course,

staff and their ability and willingness to

setting tables, changing table coverings

if larger footprints could become more

come back to work.

between diners, and no longer sharing

affordable lease-wise, you will see larger

Q. What major physical changes

condiments. Of course, all restaurant staff

kitchens and dining rooms.

will restaurants legally have to consider or make before reopening?

A. On June 11, San Francisco published

will most likely be required to complete questionnaires before each shift, wear masks, increase frequency of washing hands, and use sanitizer. Nightly cleanings will probably now include new cleaning

official guidelines for outside seating with

practices, like electrostatic cleaning. Res-

the requirement that diners will need to

taurants might take guests’ and employees’

be spaced six feet apart. Removing tables

temperatures, though this is not yet clear.

and chairs, or staggering the seating of

Restaurant and retail business owners in Italy have complained that guidelines to reopen are unclear. Do you think the same is true locally?

A. Yes, it has taken awhile. The GGRA provided a reopening document to the

customers will allow compliance, but will

I think the mandatory guidelines cover

San Francisco Economic Recovery Task-

result in financial losses. Other ways to

the bases. At the local level, most of these

force on May 21. We have also offered our

achieve a safe space could be imperme-

practices have already been put into place

staff to help with producing the items we

able partitions between tables, utilizing

for food prep and delivery.

are requesting. Guidelines were posted

on June 11.

more outside seating, adding meal kit options to the menu, and continuing to offer take-out and delivery options. San Francisco has recently announced the “Shared Spaces” program to expand the ability for restaurants to add outside seating, and the applications were posted on June 9. Some restaurants might need outdoor structures, will want to add seating in parking spaces and/or private lots near their locations, and some will want to seat in streets or park areas. All of these options will certainly require some dividers for ADA compliance and ABC compliance, and there are many outstanding questions that need to be ironed out.

JULY 2020 | SF APARTMENT MAGAZINE

Are there any non-mandated changes that you think restaurants should make before reopening?

A. I think the next steps will be figuring out how to earn customers’ confidence.

Some New York restaurants have gotten positive press for comically sitting mannequins at tables in empty dining rooms. Have you seen a creative response like this in San Francisco? Or any example of a local restaurant doing something to win diner confidence?

Do San Francisco restau rants face any unique challenges or benefits, compared to other major cities?

A. San Francisco restaurants are often in small, tight spaces. Having to adhere to sixfeet spacing is going to result in only 30% seating capacity in many restaurants. This will be financially devastating. In most San Francisco kitchens, social distancing is not even possible. In these cases, kitchen staff Dining Out Down the Line… cont. on page 50

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SF APARTMENT MAGAZINE | JULY 2020

ROLE REMODELS written by

JO S H L E V I TA N

Learn to effectively and efficiently renovate units between tenancies for post-COVID-19 renters. As a rental property owner, you want to get more value from your properties by attracting higher rents and retaining good tenants. One way to achieve both goals is by renovating to create a more functional, attractive, and enjoyable place to live. In addition to higher rents and lower turnover, you can expect some or all of the cost of a renovation to be recovered in the added resale value.

Scope-of-Work The Kitchen: Consider what upgrades will get you the best value for your time and financial investment. Focus on aspects of the home that provide obvious value to tenants. A renter is less likely to focus on infrastructure, such as electrical and plumbing systems, so long as they work. Kitchens and bathrooms are the spaces people focus on when evaluating a potential home. Renters want kitchens that are bright, clean, open, and functional. Ample cabinet storage and countertop work space, together with appliances, are the core of the kitchen. Think carefully before considering layout changes. If the location of the appliances work, don’t relocate them. Relocating appliances, or moving outlets and light fixtures, can trigger expensive electrical upgrades to meet current code requirements. Adding or reconfiguring cabinets and countertops and replacing outdated fixtures, while keeping appliances in the same location, is an effective and efficient way to upgrade a kitchen without electrical upgrades. When should you consider kitchen layout changes? People do want a functional working triangle between the sink, cooktop, and refrigerator. If the kitchen does not have a functional working triangle, and moving one or two appliances can create one, consider the cost/benefit tradeoff. Moving appliances is likely to make more sense in a high-end property than in a low-end property, where the increase in rent might not match the added cost. When moving appliances, you’ll likely require some electrical upgrades, which means adding outlets and new circuits to get up to code. However, if you are moving appliances, consider adding lighting, since you are already upgrading electrical systems.

JULY 2020 | SF APARTMENT MAGAZINE

Simple white and gray tones create a bright, clean, open aesthetic. The pattern in the countertop and dark grout in the backsplash breaks the space up so it is not too white. The floor features a durable engineered hardwood in a popular ash-gray. All appliances are a sleek stainless steel.

CONSIDERING COVID-19 On the topic of design, it’s important to acknowledge that COVID-19 may have an immediate and lasting impact on what renters look for in their home. People are spending more time at home. They cook more. It’s more common for everyone to be home at the same time. This will normalize over time, but there is likely to be a lingering impact. Expect renters to value a functional kitchen more than before. That means valuing more countertop space, more cabinet storage, and better cooktops. Expect the trend of bar seating at islands and peninsulas to continue. With the workforce increasingly working from home, lighting has a big impact on mood and productivity. Expect renters to want more light in their work spaces. Adding or expanding windows is expensive and includes a long permit process. Instead, make improvements by using bright colors on the walls and other surfaces; white and very light gray paint are good options. Replace existing light fixtures with brighter fixtures to add light without moving wires. Avoid dark cabinets, which give spaces an overall darker feel. Finally, there could be a reversal of the recent trend of removing walls to open up kitchens to dining and living areas. With everyone spending more time at home, people will need their space. Having separate areas to take calls, watch TV, or for kids to play will become more valuable.

SF APARTMENT MAGAZINE | JULY 2020

The Bathroom: In the bathroom, layout

light fixtures using more contemporary

To determine the right scope and budget

changes are even less likely to make sense

options, but without relocating them (that’s

for a project, get bids from two to three

than in the kitchen. The three main plumb-

more expensive). Make sure door handles,

contractors. Have a solid idea about what

ing fixtures are the toilet, shower, and

vanity pulls, and cabinet pulls are the same

you want before you speak to contractors,

vanity. Avoid moving the toilet if you can,

color. These changes should all be possible

which will result in bids that are easier

especially more than six inches (the toilet

without changes to the electrical, plumbing,

to compare. No two bids are apples-to-

drain line is expensive to move). Unless it

or mechanical infrastructure.

apples. You will always need to do some

would vastly improve the layout, relocat-

work to understand the differences.

ing the tub or shower is unlikely to return

Selecting Materials

a lot of value. Moving the vanity, particu-

Pick designs and materials that have broad

Work should begin after you have a

larly along the same wall, is less likely to

appeal and avoid short-term trends. Sky-

contractor and bid you’re comfort-

create problems. If you can fit a bigger

light’s Design Studio recommends bright,

able with, a detailed scope of work and

vanity with more storage and countertop

neutral colors like whites and grays for

budget, and a signed contract. Starting

space, it might be worth it. Similarly, you

rental and resale value. We recommend

without an agreement or with a vague

should avoid moving light fixtures or out-

simple patterns and clean lines. Durability

scope of work often leads to major cost

lets unless you’re looking for a bigger proj-

is an important consideration because rent-

overruns and delays. It’s not unlikely for

ect, as these moves may trigger expensive

ers create more wear and tear. You want

renovation costs to increase by 50% dur-

electrical upgrades.

your renovation to last.

ing construction (sometimes they even double!). The best chance you have at

Instead, consider new finishes and fixtures,

Project Materials Recommendations:

avoiding surprises is by picking the right

which go a long way toward making the

Countertops: Invest in quartz because its

contractor and having a detailed agree-

space attractive. Focus on replacing the

attractive, durable, budget friendly, and

ment. This is critical. If you can find a

floor tile, replacing the vanity, redoing the

easy to maintain.

contractor to prepare a detailed scope of work and also guarantee the budget,

shower, and upgrading accessories like lights and towel bars. An upgraded shower,

Stainless steel: Stainless steel is still the

new flooring and fixtures, and a fresh coat

most popular choice for appliances.

of paint make a bathroom look and feel

like Skylight, that is your best bet.

Optimize Your Timeline:

new. Keeping the design bright and simple

Tiles: Use full-bodied porcelain on floors

Start planning as early as possible. Ideally,

makes the bathroom feel luxurious.

and walls because they are the best mix of

by the time a unit becomes vacant, every-

durability, attractiveness, and value. Rectan-

thing will be lined up and ready to go. Wait-

gular tiles are easiest to install.

ing until a unit is vacant to start contacting

A note on showers: It’s becoming common to convert tub/showers into stand-

contractors will bring pressure to rush

ing showers. Most adults prefer a standing

Tile size: Tiles between 3” x 3” and 24” x 24”

shower and do not take baths. A standing

are preferable. Note, tiles are laid one by

shower is also more attractive and feels

one, so the smaller the tile, the larger the

Keeping floor plans and many photos of a

luxurious. However, there are two impor-

job. Tiles bigger than 24 inches might re-

unit will enable you to get quotes without

tant considerations. First, if you would like

quire the floor or wall to be leveled, and the

disturbing current tenants. Consider apps

to attract young families, they will want

tiles become heavy and harder to handle.

like Canvas or Magic Plan.

at least one bath for children. Second, a

We prefer to work with tiles that are either

standing shower requires more space than

3” x 6” or 12” x 24” because they are neat,

Stick with materials that are in stock to en-

a tub/shower. Most tubs are 30 inches

timeless, and easy to install.

sure a quick start and overall process. Avoid

wide. The minimum width for a shower,

through the process.

moving plumbing and electrical fixtures to

including curb, is 35 inches. Make sure you

Vanities: Bathroom vanities should be pre-

avoid possible costly delays due to unfore-

have the extra five to six inches needed

fabricated instead of custom, unless your

seen conditions in the property.

before converting.

rental is a luxury unit.

A final point to consider is consistency.

Hardware finishes: Stainless steel and

For optimal renovation results, pick up-

Many rental properties look piecemeal.

chrome are the most enduring choices.

grades with the best return, stick to endur-

Some areas might have been upgraded

Bronze and oilrubbed bronze are popular

ing design trends, have a firm scope of

while others appear neglected. Prospective

today, but that trend might change before

work, and plan ahead.

renters will assume a unit that feels consis-

you’re ready to renovate again.

In Summary

tent and fresh has been well maintained and cared for. For consistency, consider

Finding a Contractor

some easy wins. Replace light switches and

I want to emphasize the importance of set-

outlet covers throughout the unit. Replace

ting a project up for success from day one.

JULY 2020 | SF APARTMENT MAGAZINE

Josh Levitan is cofounder of Skylight. Skylight is a technology-driven general contractor providing turn-key renovations—including design, sourcing, and construction—across the Bay Area. If you have any questions about your renovation needs, you can reach out via josh@skylight.com.

Help Us, Help You. Sign up for SFAA’s Advocacy Team.

The SFAA Advocacy Team was created to defend the rights of San Francisco property owners. We are looking for volunteers to join our advocacy team. Volunteers will receive training and be tasked with advocating for local building owners, speaking at legislative hearings and writing to legislators to share personal experiences. We can change the conversation at City Hall! With your help, we can rewrite the landlord-tenant narrative and show how bad policy hurts small property owners. For more info contact Charley Goss at 415-255-2288 x14 or charley@sfaa.org.

sfaa’s 2020

TROPHY AWARDS More Info Coming Soon

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SF APARTMENT MAGAZINE | JULY 2020

JULY 2020 | SF APARTMENT MAGAZINE

A SAFE LET written by

PA M M C E L ROY

How to best market and fill vacancies while keeping yourself and potential tenants safe. With the future uncertain, many rental property owners are unsure how to move forward to fill vacancies. Corey Eckert, founder of Structure Properties, shares how COVID-19 is impacting the local rental market and advice for advertising and filling vacancies while following shelter-in-place guidelines.

Q. Have you seen changes in supply and demand since the

shelter-in-place mandate? Has your business been impacted?

A. We are seeing significantly fewer people moving to San Francisco for jobs from out of state. Additionally, we’ve seen the market soften slightly in commuter neighborhoods, like SOMA, the Tenderloin, and Civic Center. As for Structure Properties, our physical office has closed and we’re all working remotely. As a company, we’ve always embraced remote working, so that shift in our business hasn’t been challenging. We’ve outlined new guidelines for our maintenance vendors to keep them and our residents safe. Property management is a very personal industry, so our biggest change was moving to limit face-to-face interaction while staying approachable and keeping our personal touch.

Q. Have you seen changes in rents? What do you make of

these changes?

A. With Uber laying off more than 6,000 employees and Twitter rolling out an indefinite work-from-home policy, my feeling is that commuter neighborhoods will continue to soften since one of the biggest draws there is walkability to multiple tech offices and shuttles. Other renters are using this time to upgrade their living situation to allow for a home office or to be closer to parks and outdoor spaces.

What changes to the leasing process have you seen since the shelter-in-place mandate?

A. When we prepare floor plans, professional photography and 3D virtual tours for a vacant unit, we have the most success renting that property. These rental tools are relatively low in cost and enable us to provide a clear picture of the unit to renters, prior to the tour. This not only helps weed out people who

SF APARTMENT MAGAZINE | JULY 2020

end up not being interested in the layout

However, we find that open houses bring

with more sunlight and maybe those that

or a particular feature of the unit, but it

a sense of urgency to renters who are con-

are quieter and not located at street level.

also enables us to 100% focus our efforts

sidering submitting applications. We plan

on answering questions and closing the

to return to open houses at select proper-

It’s hard to speak about shared amenities,

sale, rather than simply providing a walk-

ties when it is safe to do so.

like common spaces, because at this time

through of the space.

Q. Do you have advice for owners

they are all closed.

It’s also becoming more common to digitize the application process, which is a good thing. Accepting applications online limits human interaction, while also

who may be at-risk when it comes to showing their own units?

A. According to local health guidelines,

What top three pieces of advice would you give rental property owners looking to fill vacancies this year?

speeding up the application process.

anyone with an increased risk should

Q. Have standards changed for

really not be outside interacting with

A. The best way to help your listing stand

other people unnecessarily. I recommend

out is by investing in professional photogra-

for anyone at risk to get assistance with

phy, floor plans and 3D tours.

in-person showings of vacant units to potential renters?

A. Units should always get a very deep

showings by hiring a licensed agent who has already adapted their business prac-

Be patient and listen to the market: It’s

tices during COVID, at a very minimum.

more important now than it ever has been to keep a very close eye on the current mar-

cleaning after tenants move out, including disinfecting. This has always been

At this time we have been helping many

ket. In some neighborhoods, rents are still

the case though; we’ve always had strict

owners who usually rent on their own by

very strong and sometimes continuing to

cleaning standards for our properties.

still giving them full control over the final

rise. While in others, it might be necessary

Now I’ve armed myself and my agents

application decision.

to take minor reductions, offer move-in incentives and be a bit more patient in filling

with disinfectant supplies so they can sterilize units between showings as well.

If hiring an agent is something that’s just

your vacancy.

not possible, practice social distancing Whoever is showing the unit should

guideline when showing units, host as

Consider bringing your application process

be wearing a face covering and gloves.

many virtual tours as possible, and take

online with Intellirent, which is offered free

They should be carrying hand sanitizer

the time to answer questions from each

for SFAA members.

and maintain six feet of distance at all

potential applicant over the phone in-

times during tours. My team and I steril-

stead of in person.

And this is a fourth piece of advice, but

I think now is the perfect time to consid-

ize door knobs and other surfaces with disinfectant wipes between each tour. This not only helps renters feel safe during showings, but it also shows them that they’d be renting from a responsible building owner or agent.

Do you predict renters will change their preferences for amenities, such as keyless entry or communal spaces like roof decks?

A. We haven’t had too many requests for

Rental property owners should also take

keyless entry, but we’ve certainly seen peo-

advantage of the digital applications.

ple take this as an opportunity to upgrade

It limits human interaction, but it also

their living space to accommodate working

speeds up the application process.

from home. Many companies throughout the Bay Area are offering indefinite work-

For as long as COVID-19 remains a local

from-home policies, which has resulted in

threat, only schedule private tours and

an increased amount of renters looking for

keep a close eye on current regulations to

an office nook or small second bedroom

ensure that you are in compliance.

that could be utilized as an office.

Renters are also leaning toward units with

Are open house showings a thing of the past?

A. So long as COVID-19 remains a threat,

close proximity to outdoor spaces, units that let in more natural light, that are quieter, and not on street level.

open houses are not in the best interest of potential renters, other tenants and your-

also includes choosing a building with

self as an owner.

close proximity to outdoor spaces, units

JULY 2020 | SF APARTMENT MAGAZINE

ering bringing on an agent to assist in filling vacancies. Pam McElroy is the editor of SF Apartment Magazine. Corey Eckert is a licensed California Real Estate Broker and the Vice President of Leasing at Structure Properties. He assists property owners with both leasing and full-service property management. Having previously co-founded a leasing technology startup, Corey is passionate about putting technology to work to create efficient processes that best serve our clients.

Go Online!

Find more information on SFAA classes, apartment industry news & excerpts from SF Apartment Magazine at www.sfaa.org

Call or email for an estimate Craig Lipton lipton@mavenmaintenance.com 415.829.2207 www.mavenmaintenance.com specializing in residential and commercial renovations

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Former SFAA winner * Leasing Agent of the Year * Landlord of the Year SF APARTMENT MAGAZINE | JULY 2020

Jobs

Sheridan Report… continued from page 20

25,000

losses as well (down 18,800 jobs), and the construction industry lost 11,900 jobs.

-25,000

The East Bay has also been rocked by

-75,000

historic job losses, with 169,400 jobs

-125,000

gone by April. The unemployment rate was 14.2%, up from 4.0% in March. San

-175,000 2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Monthly; San Francisco Metro Division; Non-Farm

Source: Cal. E.D.D.

Jose MSA, which also includes San Benito and Santa Clara counties, experienced a loss of 128,600 jobs; unemployment rate stood at 12.0%, up from 3.5% from March. Across the nine-county region of the San Francisco Bay Area, 555,100 resi-

Employment Growth 10.0%

dents lost their jobs in April alone and the region’s jobless rate approached 15%.

East Bay

San Francisco

5.0%

In California, some 2,344,700 people lost jobs in April—an unprecedented

0.0%

decline that has never been seen in the

-5.0%

state’s history.

-10.0% -15.0% 2010

Renters Market 2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Metro Area; Year Over Year; Non-Farm

Source: Cal. E.D.D.

Rents have always been tied to employment, along with supply and demand. Today’s marketplace reflects this, and the market has now responded to the myriad developments caused by the pandemic. Amenities and location truly matter these days. What’s in? in-unit washer and dry-

Federal Funds Rate

ers; smaller units; parking. Out? high-rise

3.0%

living; gritty neighborhoods; multiple

2.5%

bedroom units, funky units.

2.0% 1.5%

“Rents have come down,” says Jackie

1.0%

Tom. “I think it is going to stay pretty flat

0.5%

for a long time—I doubt it will bounce

0.0% 2010

back—there are so many unemployed.” 2012

2014

2016

2018

2020 Monthly Averages

Source: Federal Reserve System

Tom’s firm, Rentals in SF, specializes in leasing. She cautioned not to go off pricing found on Craigslist for rentals—it’s not the real world. Tom has seen rents down as much as

Mortgage Rates

10%, while some rents incur a mild

7.0%

adjustment or stay the same. It all boils

6.0%

30-Yr FRM

down to the quality of the unit. “Anything

5.0%

5-YR ARM

that’s quirky or dated, like units with external wall-mounted wires and trim

4.0%

painted over 25 times—you’ll see a much

3.0%

bigger rent decrease.”

2.0% 1.0% 2010

2012

2014

Source: Freddie Mac

JULY 2020 | SF APARTMENT MAGAZINE

2016

2018

2020 Monthly Averages

Everyone Wants a Deal Tenants already understand it is their market now. “Everyone wants a deal—some

kind of promotion,” reports Tom. “They’re expecting a month’s rent free upfront.” Of course, in rent-controlled jurisdictions like San Francisco, it’s never that easy. The Rent Board has previously determined that promotions like an initial month’s free rent impact a unit’s base rent. Essentially, whatever the total rent is for the initial year is averaged out by 12 and that becomes the base rent. Disconnected from reality, the board’s perplexing policy does not adjust for the unprecedented times we’re all living under and offers no leeway for owners. Resourceful owners and managers have provided new incentives to secure tenants. “We can’t offer a free month rent,” said Salman Shariat, president of Sutro Property Management, acknowledging the limitation of the rent board’s archaic policy. “But most people are not moving in immediately, so we allow a longer hold time, with the lease starting several weeks out.” His leasing strategy also includes a willingness to negotiate something that is fair for both parties. Tom reports including enticements such as free cleaning service or paying for neighborhood parking. “If you don’t give them something,” cautioned Tom, “the tenants will find something else.” “Four-bedrooms are also tough to rent these days,” reported Shariat. Groups of

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roommates living together in tight quarters under lock down are finding it hard to agree on much, let alone proper social distancing. Tenants are vacating these units and seeking smaller apartments ideal for one or two occupants. “Rents for four-bedroom units have come down quite a bit,” Tom adds. “Laundry is more important—folks don’t like sharing— no touching.” With business a tad slow due to the pandemic, one positive development for Jackie is she launched a Facebook group called ”San Francisco Landlords” where owners can share stories and discuss all the

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zany legislation coming from City Hall. She remains cautions, “Rents may go down—I don’t know if we’ve hit bottom yet.” Some owners have noticed tenants fleeing the ultra-lux living found in South of Market WS19-023 Just Got Easier Ad 4_875x10.indd 1

SF APARTMENT MAGAZINE | JULY 5/28/192020 8:39 41 AM

Gross Domestic Product

high-rises for less dense housing in outly-

6.0

ing popular neighborhoods. Having been

4.0

cooped high up inside glass-walled units with the only way out by elevator, tenants

2.0

are looking for doors that open onto a

0.0

street or have reasonable walk-ups. Access

-2.0

to a park nearby is a huge plus these days, as well as in-unit washers and dryers.

-4.0 -6.0

2010

2011

2012

2013

Source: US Bureau of Economic Analysis

2014

2015

2016

2017

2018

2019

2020

“SOMA is getting killed,” declared Shariat, who manages a number of class B/C buildings in the neighborhood. “We have a lot of vacancies there,” he reported. “In rough areas, tenants are giving notice and moving to better ones within San

Unit Count (Multifamily Permits)

Francisco. While he has not witnessed a

2,500

big drop in rents in the portfolio he manages, he reports that units that have all

2,000

the “boxes” checked—dishwashers, in-unit

1,500

laundry—are still garnering interest.

1,000

Shariat closely monitors the rental market

500

and has begun to see some lower rents in

0 2010

the city for smaller studio units. “Studios 2011

Source: US Census

2012

2013

2014

2015

2016

2017

2018

2019

2020

5+ Unit Buildings; San Francisco

have gotten hit pretty hard,” he reports. “You can find a Pacific Heights studio these days for $1,950, while stuff in the tenderloin is going for $1,550—it’s bad.” He’s reports a sizable number of tenants giving 30-day notices seeking out larger units.

Vacancy Rate 10%

So long ADUs—Hello Parking! With legitimate concerns revolving around

social-distancing protocols and commuting 5%

on public transit, one large owner interviewed for this column reported he quietly

3% 0%

dropped plans to create additional dwelling units and returned the allocated space 2010

2011

2012

Source: U.S. Census Bureau

2013

2014

2015

2016

2017

2018

2019

2020

San Francisco Bay Area

back to parking. “We shut them all down,” said the owner, who asked to remain anonymous. He predicts tenants returning to San Francisco from Oakland, seeking close proximity to the action and their jobs.

Ellis Act (Affected Units)

Apartment Building Sales

125

As of late May, trading of apartment houses

100 75

had slowed dramatically, with sales occur-

Historic Average

ring infrequently. Since the SIP order was imposed, only two newly listed buildings

were sold; one was nearly vacant. Coupled

building, lenders have increased rates and

0 2010

the regulations and limits on showing a imposed tougher underwriting standards. 2011

Source: SF Rent Board

Monthly Count

2012

2013

2014

JULY 2020 | SF APARTMENT MAGAZINE

2015

2016

2017

2018

2019

2020

Average Since 2010

Sizable reserves are now required, and due to the local eviction moratorium, buildings

with units that have tenants who are unable to or refuse to pay rent, must have their rent rolls audited and the deferred or lost rent is not factored into the property’s gross rents.

Dot-Com Bust San Francisco housing has weathered several tumultuous downturns over the last few decades. The devastating impact caused by 1989’s Loma Prieta earthquake was followed by a recession that left housing in the doldrums for years. The zany build-up of the dot-com era lead to an economic implosion locally that effected rents and prices for some time; only to recover thanks to disastrous sub-prime lending standards that quickly overinflated housing prices and pushed the global economy into the Great Recession. These downturns

four ways to connect

were caused by financial and economic factors. Today’s crisis was borne out the preventative measures to stop a pandemic. The restrictions, shutdowns and layoffs will hopefully be temporary. Tim Carrico, a past president of SFAA, remembers the dot.com bust was an allaround disaster in many ways, especially for South of Market commercial buildings. “The idiots offered landlords ridiculous rents, often for space they didn’t even need, but thought they might in the future when the pigs started flying,” reflected Carrico. Many small- and medium-size businesses had to move out—many out of the city—and in a very short time, it all

SFAA will always be available by phone and email, but now you can connect online, too. Follow the happenings of your fellow SFAA members and find out the latest in the industry by connecting with SFAA on

Facebook. Search San Francisco Apartment Association and “Like” it to add it to your news feed. Follow SFAA on Twitter at www.twitter.com/SFAptAssoc.

went poof! and the landlords were left with empty buildings. The bust put thousands of web-page designing and tech tenants out of a job, and when they couldn’t afford the rents (which they had bid up on their apartments), they left town. “That left a lot of empty apartments for residential landlords and a big drop in rent levels for the next few years,” commented Carrico, a broker with Coldwell Banker. “I don’t really remember the slope on apartment-building values, but I did buy an 18-unit Marina-style building in 2000 for 9 times gross and I always thought it might have been the last building sold in San Francisco for under 10 times gross! Sheridan Report… continued on page 47

SF APARTMENT MAGAZINE | JULY 2020

Capitalize with Compromise… cont. from pg. 24

very positive influence. (See my article in

and gyms. It is going to be a hard sell to

the June issue of SF Apartment Magazine.)

switch from your solitary run in the park to a treadmill surrounded by a bunch of

cost of employees, health care, rent, city

sweaty, coughing workout neighbors.

taxes and a deteriorating retail market.

“Lead” Tenants—These businesses are in

Businesses like Specialty’s Bakery, Nei-

serious danger of never coming back. The

man Marcus, Pier 1 Imports, and The Art

“Amazon effect” was already giving these

How are owners handling these different

Institute have already thrown in the towel

businesses a tough time. Businesses like

categories? For the Gold tenants, it’s not

or filed for bankruptcy protection on the

retail clothing, vitamin stores, and travel

likely that owners can get more money

almost inevitable road to liquidation. The

agents. So many of us have been shop-

from their tenants who are benefiting from

big challenge for restaurants, nail salons,

ping online during the SIP, and it will likely

the crisis or at least not hurting, so most of

and hair salons are the requirements for

become a permanent habit for many San

them are just happy their tenants are do-

social distancing that will restrict them

Francisco consumers. Most medical pro-

ing well. If the lease comes up for renewal,

to 50% capacity for an undetermined

fessionals I have talked to feel there is a

owners may try to get an increase, but they

amount of time. This will severely impact

significant expectation in the medical com-

also may not. For the Silver tenants, owners

how many employees they can have and

munity that we will be locked down again

are working with them to try to give rent

how much money a business owner of this

for round two of SIP in the fall as experts

reductions or rent abatement with the hope

kind can make—making it difficult to pay

predict a resurgence of COVID-19. If this

that they survive. In the case of the Bronze

rent. In the real estate market, we expect

happens, we’ll likely see even more failures

and Lead tenants, owners have been forced

to see less of a sustained downturn, as

in this category. The common strategy for

to get creative. I hear it is not uncommon

happened in 2008 – 2010 in San Francisco,

owners whose tenants run these businesses

for an owner to ask the tenant to open their

and a faster recovery compared to that real

is to offer them a deep discount on their

business back up and either not pay rent

estate recession. The volume of home sales

rent to keep them from going “dark.” Some

or pay only nominal rent on a month-to-

and multi-family investment transactions

of the retail stores around Union Square are

month basis, while the owner attempts to

have been down during the SIP order, but

being occupied by retailers who will likely

market and re-tenant the space. The goal is

values have held. The lack of COVID-19

reopen, but with a skeleton staff, and they

to make the building look viable while do-

deaths here in San Francisco, relative to

will eventually fail. Other businesses in this

ing everything you can to swap out a Lead

the rest of the country, does seem to be a

category include group exercise studios

tenant for a Bronze or move from Bronze

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JULY 2020 | SF APARTMENT MAGAZINE

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sfaa sfaa 2020 What You Need to Know

to Silver tenants. If owners can get a better tenant quickly, without spending too much on tenant improvements, then they are winning the game. What does the future hold for office and retail in San Francisco? We will continue to see the market evolve under the Coronavirus crisis. For some retail businesses, this will be like the dinosaurs getting wiped out by an asteroid, except this “Extinction Event” would be the result of Amazon fol-

2020 SFAA UPDATES

VIRTUAL MEMBER MEETINGS

July 20, 2020: Rent Board Updates with Fair Housing Compliance August 17, 2020: Tenant Attorney Panel

UPCOMING CLASSES During shelter-in-place, the monthly SFAA member meetings and classes will be held virtually. For member meeting topics and schedules, go to www.sfaa.org. For a list of virtual SFAA classes, turn to the calendar on page 48.

lowed by COVID-19. For many, it will not be the end, but it will be a changed world. We can be certain of one thing, until we have herd immunity, a test for everyone, or a vaccine, the “new normal” for San Francisco retail will continue as is, and it will be painful to both tenant business owners and building owners. My advice is to do whatever you can to work with your tenants, so you can both survive. Terrence Jones is a Senior Broker Associate with Corcoran Global Commercial. He can be contacted at (415) 786-2216 or terrence@terrencejonesSF.com.

SFAA OFFICE CLOSURE The SFFA office will remain closed during the shelter-in-place mandate. However, SFAA staff is working round-the-clock to keep the nonprofit running. Timely payment of membership dues is necessary to help the association help you.

ONE STOP MAINTENANCE AND PROPERTY SERVICE

SFAA TRADE SHOW RESCHEDULED The annual SFAA Trade Show has been rescheduled to September 3, 2020 and will be held at the Fort Mason Center. For more information, turn to page 10. To sponsor the event, email Vanessa Khaleel at vanessa@sfaa.org.

One Stop Maintenance and Property Service provides quality service solutions for both commercial and residential clients—guaranteed! We provide a superior level of painting, cleaning, janitorial, and handyman services to many satisfied customers. Contact us today for a personal, no obligation consultation at (415) 404-0957 or email us at info@sf1stop.com

San Francisco Apartment Association

265 IVY STREET | SAN FRANCISCO, CA | 94102 | PHONE 415-255-2288 | FAX 415-255-1112

JULY 2020 | SF APARTMENT MAGAZINE

Sheridan Report… continued from page 43

“The big message to me from the dot.com disaster, was the powerful effect that employment levels have on rents,” said Carrico. “Rents didn’t start rising again until the jobs started coming back some years later.”

TALENT. COLLABORATION. SUCCESS.

Matthew C. Sheridan is an apartment building specialist with Newmark Knight Frank and is the emeritus editor and publisher of this magazine. He can be reached at 415-273-2179.

Know Your

numbers

KILBY STENKAMP

Turn to page 49 for updated information on allowable rent increases, security deposit interest and more.

415.370.7582

kilby@vanguardsf.com DRE# 01208585

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sfaa 2 2020calendar

sfaa

July

MONDAY, JULY 6

THURSDAY, JULY 2

TUESDAY, JULY 7

WEDNESDAY, JULY 8

11:30 a.m.

Hoarding

Animals: ESA v.s. Pets

is Better for Our Future

Board of Directors Mtg.

Lunch & Learn

Zoom Webinar System

12:00 p.m. to. 1:00 p.m.

Members $25 Non Members $40

12:00 p.m. to. 1:00 p.m.

Members $25 Non Members $40

Recology: Better at the Bin Zoom Webinar System

11:00 a.m. to. 12:00 p.m.

Members $25 Non Members $40

THURSDAY, JULY 9

FRIDAY, JULY 10

TUESDAY, JULY 14

THURSDAY, JULY 16

Dealing Disasters: Earthquake/

Roommates Class

ADA: When a Tenant

Small Claims

Lunch & Learn

Flood/Fire Displacement Zoom Webinar System

12:00 p.m. to. 1:00 p.m.

Members $25 Non Members $40

Master Tenants, Subtenants &

Lunch & Learn

Makes a Request

Zoom Webinar System

11:00 a.m. to. 12:00 p.m.

Members $25 Non Members $40

Zoom Webinar System

12:00 p.m. to. 1:00 p.m.

Members $25 Non Members $40

Lunch & Learn

Zoom Webinar System

12:00 p.m. to. 1:00 p.m.

Members $25 Non Members $40

MONDAY, JULY 20

TUESDAY, JULY 21

WEDNESDAY, JULY 22

THURSDAY, JULY 23

Rent Board Updates with Fair

Attorney

Zoom Webinar System

in Property Management

Virtual Member Meeting Housing Compliance 1:00 p.m.

Lunch & Learn When to Hire an

Leasing Your Units 101 1:00 p.m. to. 2:00 p.m.

Zoom Webinar System

12:00 p.m. to. 1:00 p.m.

Members $25 Non Members $40

Lunch & Learn How to Document Zoom Webinar System

12:00 p.m. to. 1:00 p.m.

Members $25 Non Members $40

SFAA MEMBER MEETINGS WILL BE HELD VIRTUALLY UNTIL FURTHER NOTICE DUE TO COVID-19. FOR TOPICS AND SCHEDULES, TURN TO PAGE 46 OR VISIT SFAA.ORG.

THURSDAY, JULY 30

Section 8 Rent Increases Zoom Webinar System 1:00 p.m. to. 2:00 p.m.

Members $25 Non Members $40

August MONDAY, AUGUST 3

THURSDAY, AUGUST 6

TUESDAY, AUGUST 11

MONDAY, AUGUST 17

11:30 a.m.

Zoom Webinar System

Tenant Attorney Panel

Board of Directors Mtg.

Serving Notices

1:00 p.m. to. 2:00 p.m.

Members $25 Non Members $40

JULY 2020 | SF APARTMENT MAGAZINE

Tenant Lawsuits

1:00 p.m. to. 3:00 p.m.

Members $40 Non Members $50

Virtual Member Meeting 1:00 p.m.

join online at sfaa.org or call 415.255.2288

2020 join online at sfaa.org or call 415.255.2288

SAN FRANCISCO’S

RENT BOARD FEE

$25.00

Chapter 37A of San Francisco’s Administrative Code allows the city to collect a per-unit fee for each residential dwelling unit that is subject to the San Francisco Rent Ordinance. This fee defrays the entire cost of operation of the Rent Board. This fee is billed to the landlord each year on the property tax statement sent in November, but the law permits landlords to collect a portion of the Rent Board fee from those tenants in occupancy as of November 1 of each year. A landlord is allowed to collect 50% of the cost of the fee from the tenant. If you have not collected Rent Board fees in the past, you can collect back to 1999. ALLOWABLE RENT BOARD FEE COLLECTABLE FROM TENANTS 2019-2020

$25.00

2018-2019

$22.50

2017-2018

$22.50

2016-2017

$20.00

2015-2016

$18.50

SFAA’S

TENANT SCREENING SERVICE THROUGH INTELLIRENT STEP 1:

Create a free account at sfaa. myintellirent.com/agent-signup. STEP 2:

Invite an applicant to apply via an online application customized to SFAA’s criteria. You can also publish your available rental on Intellirent across mulitple ILSs. RATES

Intellirent is your free, online rental application and property marketing tool, partnered with Transunion to instantly return complete credit reports and nationwide eviction notices. Renters pay the $40 application fee, which covers your costs. For more information, simply create your free account or go to sfaa.org and choose the “Resources” tab. Then select “Tenant Screening.” Please note that the maximum you can charge a tenant for screening services is $49.12. CONTACT INTELLIRENT FOR MORE INFORMATION:

415-849-4400

CAPITAL IMPROVEMENTS

The capital improvement interest rates for 3/1/19 through 2/29/20 are listed below: AMORTIZATION

INT. RATE

MULTIPLIER

7 YEARS

2.8%

.01312

10 YEARS

2.9%

.00961

15 YEARS

3.0%

.00691

20 YEARS

3.0%

.00555

INTEREST ON DEPOSITS Deposits include all tenant monies that the owner holds, regardless of what they are called. At the landlord’s option, the payment may be made directly to the tenant or by allowing the tenant to deduct the amount of interest due from the rental payment. INTEREST ON DEPOSITS PERIOD

AMOUNT

03/01/20 - 02/29/21

2.2%

03/01/19 - 02/29/20

2.2%

03/01/18 - 02/28/19

1.2%

03/01/17 - 02/28/18

0.6%

2014-2015

$18.00

03/01/16 - 02/28/17

0.2%

2013-2014

$14.50

03/01/15 - 02/29/16

0.1%

2012-2013

$14.50

03/01/14 - 02/28/15

0.3%

2011-2012

$14.50

03/01/13 - 02/28/14

0.4%

2010-2011

$14.50

03/01/12 - 02/28/13

0.4%

2009-2010

$14.50

03/01/11 - 02/29/12

0.4%

2008-2009

$14.50

03/01/10 - 02/28/11

0.9%

2007-2008

$13.00

2006-2007

03/01/09 - 02/28/10

3.1%

03/01/08 - 02/28/09

5.2%

$11.00

03/01/07 - 02/29/08

5.2%

2005-2006

$10.00

03/01/06 - 02/28/07

3.7%

2004-2005

$11.00

2003-2004

$21.50

2002-2003

$21.50

CONTACT THE SAN FRANCISCO RENT BOARD FOR MORE INFORMATION

ALLOWABLE RENT INCREASES

2020 – 2021: 1.8%

Effective March 1, 2020, through February 28, 2021, the allowable annual rent increase is 1.6%. This amount is based on 60% of the increase in the Consumer Price Index for all urban consumers in the Bay Area. A history of all allowable increases and their effective periods is provided. ALLOWABLE RENT INCREASES PERIOD

AMOUNT

03/01/20 - 02/29/21

1.8%

03/01/19 - 02/29/20

2.6%

03/01/18 - 02/28/19

1.6%

03/01/17 - 02/28/18

2.2%

03/01/16 - 02/29/17

1.6%

03/01/15 - 02/29/16

1.9%

03/01/14 - 02/28/15

1.0%

03/01/13 - 02/28/14

1.9%

03/01/12 - 02/28/13

1.9%

03/01/11 - 02/29/12

0.5%

03/01/10 - 02/28/11

0.1%

03/01/09 - 02/28/10

2.2%

03/01/08 - 02/28/09

2.0%

03/01/07 - 02/29/08

1.5%

03/01/06 - 02/28/07

1.7%

SAN FRANCISCO RENT BOARD 25 Van Ness Avenue #320 San Francisco, CA 94102 415-252-4600 www.sfgov.org/rentboard

CONTACT THE SAN FRANCISCO RENT BOARD FOR MORE INFORMATION

415-252-4600 sfgov.org/rentboard

415-252-4600

& information

sfgov.org/rentboard

SF APARTMENT MAGAZINE | JULY 2020

Dining Out Down the LIne… cont. from page 28

able to pay full rent. Any forgiveness or sharing the pain would be so helpful.

will have to be diligent about wearing face masks and gloves, and frequently washing

For example, if you are only seeing 30%

and sanitizing hands.

- 40% of normal revenue, a lease that was 9% of your P&L could become up to 30%

Another challenge we face in San Fran-

or more of your P&L. This is not sustain-

cisco is our climate. While our weather is

able. The goal should be to keep tenants in

mostly pleasant, in the evening it’s cold

operation. Remember, they can always file

(and in the summery foggy) out! This, of

for Chapter 11 bankruptcy or reorganize,

course, poses a challenge for expanding

which freezes most leases as soon as it is

capacity with outside seating. Some kind

filed. Nobody wants it to come to that. And,

of protection from the wind and cold will

commercial landlords should realize there

be needed. I am hopeful that the fire de-

will not be many restauranteurs looking to

partment might agree to allow free stand-

start a new operation until COVID19 is no

ing outside heaters, so long as nothing

longer an issue—meaning everyone is vac-

flammable is close by.

cinated and/or there is herd immunity.

Q. What type of commercial

Another thing to consider is that all recent

renter or restaurant is most likely to succeed going forward? What businesses face the biggest struggle?

A. It is tough to say. I think neighborhood restaurants will have a better chance

indications are that it will take the tourism sector two to three years to fully recover.

Q. What advice do you have for

commercial renters at this time?

than those downtown or in SOMA that

A. Figure out your numbers and try

depend of Moscone conventions, tech and

to negotiate with your landlord. If the

other office workers, and tourists for busi-

numbers don’t make sense, you will know

ness. I’m concerned that our traditional

it. Look for all forms of financial relief that

business model just won’t work any longer

you can find.

when restaurants are operating at a significantly reduced capacity. Especially consid-

Pam McElroy is the editor of SF Apartment Magazine.

ering how high the cost of doing business is in San Francisco. There is hope though: people seem to want to get back to socializing together again eventually.

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And, unfortunately, larger restaurant groups and chains are probably better set up to handle this big setback financially. This would be case-by-case by neighborhood though, as San Francisco restaurant groups with more than 11 locations are prohibited by formula retail bans.

Q. What advice do you have for

commercial property owners at this time?

A. Please negotiate with your restaurant, bar, and retail tenants. Ideally, some kind of rent forgiveness for March and April, and then a percentage of the existing leases going forward. What it comes down to is many restaurants and bars just won’t be

JULY 2020 | SF APARTMENT MAGAZINE

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sfaa professional

services directory 1031 TAX DEFERRED EXCHANGE SERVICES

FIRST AMERICAN EXCHANGE COMPANY 415-244-1339 www./firstexchange.com/ HERITAGE CAPITAL ADVISORS Eric Scaff 415-834-1031 www.heritagecap.com LAWYERS EQUITY EXCHANGE Brian Fogarty 415-701-1234 www.lex1031.com

ACCOUNTANTS

SHWIFF, LEVY & POLO LLP Elizabeth Shwiff 415-291-8600 x232 www.slpconsults.com

ALARM COMPANY

AEC ALARMS Michelle Rogers 408-298-8888 x123 www.aec-alarms.com/

ARCHITECTURE

OPENSCOPE STUDIO ARCHITECTS Mark Hogan 415-891-0954 www.openscopestudio.com Q ARCHITECTURE Dawn Ma www.que-arch.com

415-695-2700

ASSOCIATIONS

PROFESSIONAL PROPERTY MANAGEMENT ASSOCIATION J.J. Panzer www.ppmaofsf.org

ATTORNEYS

BORNSTEIN LAW Daniel Bornstein, Esq. www.bornstein.law CHONG LAW Dolores Chong DENNIS C. HYDE Dennis C. Hyde hydelaw@pacbell.net

415-490-9020

FRIED & WILLIAMS LLP Clifford E. Fried www.friedwilliams.com

415-421-0100

GOLDFARB & LIPMAN LLP Erica Williams 510-836-6336 eorcharton@goldfarblipman.com goldfarblipman.com

MILLAR AND ASSOCIATES, APLC James Millar 415-981-8100 x101 Millar-law.com

415-861-8800

JACOBSON LAW PC Isaac@jacobsonlawsf.com 415-421-0100 KAUFMAN, DOLOWICH, VOLUCK Ashley Klein 415-926-7612 aklein@kdvlaw.com LAW OFFICES OF FRANCISCO GUTIERREZ Francisco Gutierrez 415-805-6508 francisco@gtzlegal.com LAW OFFICE OF MICHAEL HEATH Michael Heath 415-931-4207 Mheath_law@sbcglobal.net THE LAW OFFICES OF KIMBALL, TIREY & ST. JOHN LLP Daniel Kimball 800-525-1690 www.kts-law.com LAW OFFICES OF DENISE A. LEADBETTER Denise Leadbetter 415-713-8680 www.leadbetterlaw.com

415-438-7807

JULY 2020 | SF APARTMENT MAGAZINE

MATLIN & ASSOCIATES Shauna L. Matlin, Esq. 415-305-5637 www.sfevictionattorney.com

HERZIG & BERLESE Barbara Herzig bherzig@hbcondolaw.com

LAW OFFICES OF DANIEL PICCININI Daniel Piccinini 415-345-8610 danielpiccinini@att.net

FRANK KIM ESQ., EVICTION ASSISTANCE Jo Biel 415-752-6070

MASTROMONACO REAL PROPERTY LAW GROUP Leonard Mastromonaco 415-354-2702 len@mastrolawgroup.com

MCLAUGHLIN SANCHEZ, LLP Michael McLaughlin 415-655-9753 www.msllp.law

415-409-7611

415-753-3811

LAW OFFICE OF KEVIN P. GREENQUIST Kevin Greenquist 415-977-0444x234 www.ztalaw.com

GOLDSTEIN, GELLMAN, ET AL, LLP Brett Gladstone 415-673-5600 x 238 www.g3mh.com

LAW OFFICES OF SCOTT T. OKAMOTO Scott T. Okamoto 415-766-5871 www.scottokamotolaw.com

DOWLING & MARQUEZ, LLP Jak S. Marquez 415-977-0444 x232 www.dowlingmarquez.com

FISHER & PHILLIPS, LLP Jason Gellar www.fisherphillips.com

LAW OFFICES OF LAWRENCE M. SCANCARELLI Lawrence M. Scancarelli 415-398-1644 www.sfrealestatelaw.com THE LAW OFFICE OF ED SINGER Edward Singer 650-393-5862 www.edsinger.net

NICHOLAS GOLDMAN LAW Nicholas Goldman 415-350-8740 nicholas@nicholasgoldmanlaw.com O’GRADY LAW GROUP John O’Grady john@ogradylaw.com www.ogradylaw.com

415-986-8500

REUBEN, JUNIUS & ROSE, LLP Kevin Rose 415-567-9000 www.reubenlaw.com TOUR-SARKISSIAN LAW OFFICES Christine Tour-Sarkissian 415-626-7744 www.tslo.com TRN LAW ASSOCIATES Tiffany Norman tiffany@trnlaw.com

415-823-4566

WASSERMAN-STERN David Wasserman 415-567-9600 www.wassermanstern.com WIEGEL LAW GROUP Andrew J. Wiegel www.wiegellawgroup.com

415-552-8230

ZACKS, FREEDMAN & PATTERSON, P.C. Andrew M. Zacks 415-956-8100 www.zfplaw.com ZANGHI TORRES ARSHAWSKY, LLP John P. Zanghi 415-977-0444 www.zatlaw.com

BEDBUG DETECTION

CROWN & SHIELD PEST SOLUTIONSPREMIER Aurora Vidaca 888-970-1927 aurora@crownandshieldpestsolutions.com www.crownandshieldpestsolutions.com SCENT TEK Brent & Kevin Youngblood 415-933-0879 www.scent-tek.com

CLEANING SERVICES MARVEL MAIDS Sherri Jessen www.marvelmaids.com

415-546-8000

OPTIMUS BUILDING SERVICES Claudia Giraldo 650-290-4607 optimusbuildingservices.com PUMA POWER WASH Tiger Guy 415-825-2559 info@pumapowerwash.com www.pumapowerwash.com

CONSTRUCTION

CURRENT CONSTRUCTION David Breslin 415-969-6915 office@currentcon.com www.currentconstruction.com

CONSULTANTS: PERMITS & PLANNING

ENVIRONMENTAL CONSULTING

A-1 CERTIFIED ENVIORNMENTAL TESTING/DUCT CLEANING Carl Gibbons 888-217-2719 chelseap60@hotmail.com a-1certifiedenvironmentalservices.com OPTIMUM INSPECTION Elad Gal 510-590-1758 info@optimummoldinspection.com P.W. STEPHENS ENVIRONMENTAL Sheri Buenz 510-651-9506 sherib@pwsei.com

FIRE ESCAPE INSPECTION & MAINTENANCE ESCAPE ARTISTS Jabal Engelhard www.sfescapeartists.com

415-279-6113

GREAT ESCAPE FIRE ESCAPE SERVICE, INC. Rich Henderson 415-566-1479 www.greatescapeinc.com

FIRE PROTECTION CONTRACTORS

BATTALION ONE FIRE PROTECTION Tim Morse 510-653-8075 www.battaliononefire.com

CENTER FOR SUSTAINABLE ENERGY Sarah Bliss 858-633-8099 sarah.bliss@energycenter.org

BELL FIRE AND LIFE SAFETY Marc Belluomin 650-580-5306 bellfire365@gmail.com

EDRINGTON AND ASSOCIATES Steven Edrington 510-749-4880 steve@edringtonandassociates.com

COMMERCIAL FIRE PROTECTION, INC. Laine Sims 925-300-9534 www.fireprotected.com

CONTRACTORS

MAZZY’S FIRE PROTECTION Scott Mazzarella 415-665-5553 www.mazzysfire.com

AGUILEAR CONSTRUCTION COMPANY Javier Aguilear 707-495-3932 javier@aguileraco.com SKYLIGHT REMODLING Josh Levitan contact@skylight.com www.skylight.com

800-961-2580

CORPORATE RENTALS AMSI Robb Fleischer www.amsires.com

415-447-2020

GOROVERGO Laura Ericson 832-977-6830 laura.ericson@echemail.com www.gorovergo.com

CREDIT REPORTING

INTELLIRENT Cassandra Joachim www.myintellirent.com

415-849-4400

ENERGY SERVICES / GAS & ELECTRIC

PACIFIC GAS & ELECTRIC COMPANY Sebastian Conn 415-972-5201 www.pge.com

FURNITURE RENTALS

BROOKFIELD FURNITURE-NORCAL Mary Baird 408-720-1252 www.bfr.com

GARBAGE COLLECTION SERVICES

RECOLOGY GOLDEN GATE RECYCLING Minna Tao 415-575-2423 recologysf.com RECOLOGY SUNSET SCAVENGER Dan Negron 415-330-2911 recologysf.com

HARDWARE GRAINGER Mark D. Sheddon

800-472-4643

INSURANCE COMPANIES

ARM MULTI INSURANCE SERVICES Lisa Isom 866-913-6293 www.arm-i.com BARBARY INSURANCE BROKERAGE Gerald Becerra 415-788-4700 www.barbaryinsurance.com

BIDDLE-SHAW INSURANCE SERVICES, INC Greg Holl 415-586-7200 www.biddleshaw.com COMMERCIAL COVERAGE INSURANCE AGENCY Paul Tradelius 415-436-9800 www.comcov.com GORDON ASSOCIATES INSURANCE SERVICES Dave Gordon, CLU 650-654-5555x6972 David.gordon@gordoninsurance.com

INTERNET SERVICES PROVIDERS

COMCAST/XFINITY Michael Juliano www.xfinity.com

925-495-9922

LAUNDRY EQUIPMENT

WASH MULTIFAMILY LAUNDRY SYSTEMS Cathy Barsotti 650-340-8054 www.weblaundry.com

LENDING / FINANCIAL SERVICES

COUNTERPOINTE SRE David Snow 855-431-4000 www.counterpointeSRE.com FIRST FOUNDATION BANK Michelle Li www.ff-inc.com

415-794-2176

LENDING / FULL SERVICE BANKS

LUTHER BURBANK SAVINGS Gabriel Basso 510-601-2400 www.lutherburbanksavings.com

LENDING / INSTITUTIONS

CHASE APARTMENT LENDING Andre C. Ferrigno 415-644-2171 CHASE COMMERCIAL TERM LENDING Sharon Groenendyk 415-315-8464 www.chase.com/commercialbanking CHASE COMMERCIAL LENDING Ingrid Marlow 650-737-6212

LOCKSMITHS

CROWN LOCK & HARDWARE Joe Schoepp 415-221-9086 WARMAN SECURITY Peter Badertscher www.warmansecurity.com

415-775-8513

MAINTENANCE REPAIR SERVICE

CITY REPAIR SERVICES Fernando Fonesca 415-602-6524 contact@citycarerepair.com MAVEN MAINTENANCE, INC. Craig Lipton 415-829-2207 www.mavenmaintenance.com ONE STOP MAINTENANCE & PROPERTY SERVICES Lupe Villaloblos 408-829-0727 www.sf1stop.com

SF APARTMENT MAGAZINE | JULY 2020

WEST COAST PROPERTY MANAGEMENT Joseph Keng 415-885-6970 ext. 101 www.wcpm.com

MEDIATION

THE BAR ASSOCIATION OF SAN FRANCISCO CONFLICT INTERVENTION SERVICE Matthew Tom 415-782-8940 mtom@sfbar.org

MORTGAGE BROKER THE RINCON GROUP Casey Wright

415-622-7450

ORGANIC WASTE SOLUTIONS

ECOSAFE ZERO WASTE, INC. Daniel Redick 310-569-0624 ecosafezerowaste.com Daniel@EcoSafeZeroWaste.com

PAINTING CONTRACTORS KRUITPAINTING, INC. Pieter Kruit www.kruitpainting.com

415-254-7818

MODAMAS INC. Gabriela Laz www.modamas.com

415-552-6567

The following members are SFAA Property Management Members. They fully support the organization and are dedicated to SFAA’s goals. For more information about the benefits of becoming a Property Management Member, contact Maria Shea at maria@sfaa.org or 415-255-2288 x 10. ADVENT PROPERTIES, INC. Benjamin Scott, CCRM 510-289-1184 www.adventpropertiesinc.com

PONTAR REAL ESTATE Merri Pontar 415-421-2877 www.pontarrealestate.com

AMERICAN MARKETING SYSTEMS INC. Robb Fleischer 415-447-2020 www.amsires.com

PROGRESSIVE PROPERTY GROUP Dace Dislere & Joe Gillach 415-515-4329

CITYWIDE PROPERTY MANAGEMENT Carol Cosgrove 415-552-7300 www.citywidesf.com DEWOLF William Talmage www.dewolfsf.com

415-221-2032

GAETANI REAL ESTATE Paul Gaetani 415-668-1202 www.gaetanirealestate.com GREENTREE PROPERTY MANAGEMENT 415-828-8757 www.greentreepmco.com J. WAVRO PROPERTY MANAGEMENT James Wavro 415-509-3456 LINGSCH REALTY Natalie M. Drees www.lingschrealty.com

PROPERTY MANAGEMENT SYSTEMS Michelle L. Horneff-Cohen 415-661-3860 www.propertymanagementsystems.net REAL MANAGEMENT COMPANY J.J. Panzer 415-821-3167 www.RMCsf.com S&L REALTY Robert Link www.slrealty-sf.com

WEST & PRASZKER REALTORS Michael Klestoff 415-661-5300 www.wprealtors.com WEST COAST PROPERTY MANAGEMENT Eric Andresen 415-885-6970 www.wcpm.com

members JULY 2020 | SF APARTMENT MAGAZINE

415-386-3111

STRUCTURE PROPERTIES Corey Eckert 415-794-0064 www.structureproperties.com

415-648-1516

PETERS PAINTING SERVICES Peter Pantazelos 415-647-4722 www.peterspainting.com TARA PRO PAINTING INC. Brian Layden www.tarapropainting.com

415-334-3277

PAINTING SUPPLIES SHERWIN-WILLIAMS Khuat Hoang Sw7276362@Sherwin.com

415-576-1043

PEST CONTROL

property management BERENDT PROPERTIES Craig Berendt 415-608-3050 www.berendtproperties.com

PAC WEST PAINTING INC. Brian Beaulieu 415-457-0724 www.pacwestpaintinginc.com

ATCO PEST & TERMITE CONTROL & HOME RESTORATION Richard Estrada 415-898-2282 www.atcopestcontrol.com CROWN & SHIELD PEST SOLUTIONS-PREMIER Aurora Vidaca 888-970-1927 aurora@crownandshieldpestsolutions.com

PLUMBING SERVICES

C.R. REICHEL ENGINEERING CO. INC. Tim Lordier 415-431-7100 www.crreichel.com R & L PLUMBING Larry Bustillos 415- 651-4977 larry@rl.plumbing www.rlplumbingsanfrancisco.com URGENT ROOTER AND PLUMBING INC. Albert Lee 415-387-8163 urgentrtr@sbcglobal.net

PRIVATE INVESTIGATOR

WEN ANDASSOCIATES, INC. Hai Hua Wen 650-863-7925 www.sfpiwa.com

PROPERTY MANAGEMENT

ADVENT PROPERTIES, INC. Benjamin Scott, CCRM 510-289-1184 www.adventpropertiesinc.com ALEXANDERSON PROPERTIES Eric Alexanderson 415-285-3737 www.alexandersonproperties.com AMORE REAL ESTATE, INC Jerry Hsieh 415-567-4800 www.amoresf.com BORN PROPERTY MANAGEMENT Jason Born 650-271-7048 x 111 Jason@bornpm.com BERENDT PROPERTIES Craig Berendt craig.berendt@gmail.com

415-608-3050

BROOKFIELD PROPERTY GROUPPRESIDIO LANDMARK Jon King 855-327-5376 jon.king@brookfieldproperties.com CHANDLER PROPERTIES Carolyn Chandler 415-921-5733 www.chandlerproperties.com

CITYWIDE PROPERTY MANAGEMENT Carol Cosgrove 415-552-7300 www.citywidesf.com

PROGRESSIVE PROPERTY GROUP Dace Dislere 415-794-9727 www.progressivesf.com

YARDI Kelly Krier kelly.krier@yardi.com

DEWOLF REALTY CO. INC. William A. Talmage www.dewolfsf.com

PROPERTY MANAGEMENT SYSTEMS Michelle L. Horneff-Cohen, Broker, CCRM, MPM®, RMP® 415-661-3860 www.propertymanagementsystems.net

YMPG MANAGEMENT Yelena Glezer 415-260-6325 yglezer@ympg-management.com

415-221-2032

DJA PROPERTIES Brian James brian@djaproperties.com www.djaproperties.com

RAMSEY PROPERTIES Brian E. Ramsey 415-474-5175 Brian@RamseyPropertiesSF.com

EBALDC Felicia Scruggs FScruggs@ebaldc.org

510-287-5353

REAL MANAGEMENT COMPANY J.J. Panzer 415-821-3167 www.RMCsf.com

EQUITY ONE Brenda M. Obra www.equity1sf.com

415-441-1200

ROCKAWAY RESIDENTIAL MANAGEMENT KristineAbbey 650-290-3084 kristine@rockawayresidential.com

GAETANI REAL ESTATE Paul Gaetani 415-668-1202 www.gaetanirealestate.com

ROCKWELL PROPERTIES Mark Kaplan 415-398-2400 propertymanagement@rockwellproperties.com

GEORGE GOODWIN REALTY, INC. Chris Galassi 415-681-1265 www.goodwin-realty.com

SC PROPERTY MANAGEMENT Robert Guglielmi 650-342-3030 bob.guglielmi@scpropsm.com

GREENTREE PROPERTY MANAGEMENT Mike McCamish 415-828-8757 www.greentreepmco.com

SHARVEST PROPERTY MANAGEMENT, LLC Timothy D. Gilmartin 650-347-2020 tim@thegilmartins.com

HANFORD•FREUND & CO. J. Timothy Falvey www.hanfordfreund.com

415-981-5780

SIERRA PROPERTY PROFESSIONALS Sonali Herrera sierrappinc@gmail.com

HOGAN & VEST INC. Simon Wong simon@wongsf.com

415-237-6240

SKYLINE PMG, INC. Nicholas Bowers 415-968-9903 Nicholas@skylinepmg.com

INCOME PROPERTY SPECIALISTS Clayton Llewellyn 408-446-0848 www.ipsmanagement.cc

STRUCTURE PROPERTIES Corey Eckert 415-794-0064 www.structureproperties.com

JAMES D. MULLIN REAL ESTATE BROKER James D. Mullin 415-470-0450 jamesdmullinre@gmail.com

SUTRO PROPERTY MANAGEMENT, INC. Salman Shariat 415-341-8774 www.SutroProperties.com

JD MANAGEMENT GROUP, INC. Jonathan Davis 510-387-7792 jonathan.davis@jdmginc.com

THRIVE PROPERTY MANAGEMENT, INC. Giovani Franco 650-296-3880 www.thrivecommunities.com/

LINGSCH REALTY Natalie M. Dress www.lingschrealty.com

415-648-1516

W. PROPERTY MANAGEMENT Gary Petrison 707-545-6187 gary@wpropertymanagement.com

MERIDIAN MANAGEMENT GROUP Randall Chapman 415-434-9700 www.mmgprop.com

WEST COAST PROPERTY MANAGEMENT Eric Andresen 415-885-6970 www.wcpm.com

MW PROPERTY GROUP Marc Wilson 415-640-5807 marc@mwpropertygroupco.com

WEST & PRASZKER REALTORS Michael Klestoff 415-699-3266 www.wprealtors.com

MYND MANAGEMENT, INC. Stacy Winship 510-306-4440 www.mynd.co

WOOD PARTNERS Melissa Rankin 628-251-1101 melissa.rankin@woodpartners.com

NEW GENERATION INVESTMENTS Jonathan Ng 415-735-8233 jtng.ngi@gmail.com

PROPERTY MANAGEMENT SOFTWARE

PACIFIC UNION INTERNATIONAL PROPERTY MANAGEMENT Susan Lucas 415-722-4724 www.pacunionpm.com PONTAR REAL ESTATE Merri Pontar 415-421-2877 www.pontarrealestate.com PRIME METROPOLIS PROPERTIES, INC. Tom Chan 415-731-0303 tomchan@pmp1988.com

DROPLIT, INC. Stephen Westerfield stephen@droplit.io

212- 235-7877

HEMLANE, INC. Dana Dunford dana@hemlane.com

385-355-4361

STESSA Victor Perez www.stessa.com

626-524-4931

805-699-2040

REAL ESTATE APPRAISALS HARPER & ASSOCIATES Jay Harper JHARPSF@att.net

415-674-9243

MARK WATTS COMMERCIAL APPRAISAL Mark Watts 415-990-0025 www.markwattscommercialappraisal.com

REAL ESTATE BROKERS & AGENTS

ALAIN PINEL INVESTMENT GROUP Mark Bonn 415-614-4354 mbonn@apr.com ALAIN PINEL INVESTMENT GROUP Jay Greenberg 415-593-8615 www.aprinvestmentgroup.com ALAIN PINEL INVESTMENT GROUP Mirella Webb 415-814-6699 mwebb@apr.com BAY AREA PREMIER PROPERTIES Peter Fisler 415-606-6621 www.bayareapremierproperties.com BIG TREE PROPERTIES Evan Matteo 415-305-4931 evan@bigtreeproperties.com COLDWELL BANKER COMMERCIAL NRT Steven Caravelli 415-229-1367 steven.caravelli@cbnorcal.com COLLIERS INTERNATIONAL- JAMES DEVINCENTI James Devincenti 415-288-7848 www.THEDLTEAM.com COLLIERS INTERNATIONAL Brian Leung 415-288-7881 www.brian-leung.com COLLIERS INTERNATIONAL Payam Nejad 415-288-7872 www.colliers.com/payam.nejad COMPASS COMMERCIAL BROKERAGE Adam Filly 415-516-9843 adam@adamfilly.com COMPASS COMMERCIAL BROKERAGE Chris J. Connor chris.oconnor@compass.com FERRIGNO REAL ESTATE Chris Ferrigno 415-641-0661 www.ferrignorealestate.com KILBY STENKAMP-VANGUARD PROPERTIES Kilby Stenkamp 415-370-7582 LESLIE BURNLEY Leslie Burnley leslie.j.burnley@gmail.com leslieburnley.com

415-717-8709

MARCUS & MILLICHAP David Nelson 415-312-2245 dnelson@MarcusMillichap.com MARCUS & MILLICHAP Sanford Skeie 415-625-2153 www.marcusmillichap.com

SF APARTMENT MAGAZINE | JULY 2020

sfaa sfaa 2020 membership application

Thank you for joining the San Francisco Apartment Association. SFAA is dedicated to educating, advocating for and supporting the Rental Housing Community so that its members operate ethically, fairly and profitably. Please consult a tax preparer in advance to determine deductibility for your tax situation. Membership fees are subject to change. MEMBERSHIP LEVEL & COST

Base Fee

Units Fee

1-50

$385 +

$6.45 per unit =

51-250

$475 +

$6.45 per unit =

251-500

$675 +

$6.45 per unit =

501-1,000

$875 +

$6.45 per unit =

1,001

$1,375 +

$6.45 per unit =

TOTAL UNIT AMOUNT:

Unit Fee

1-50

$485 +

$3.95 per unit =

51-250

$575 +

$3.95 per unit =

251-500

$775 +

$3.95 per unit =

501-1,000

$975 +

$3.95 per unit =

1,001

$1,475 +

$3.95 per unit =

TOTAL UNIT AMOUNT:

STEELE PROPERTIES Ryan Steele 415-881-7762 www.steeleproperties.com

ZEPHYR REAL ESTATE Dawn Cusulos 415-678-8854 dawncusulos@zephyrre.com

REAL ESTATE INVESTMENTS ALAIN PINEL INVESTMENT GROUP Trigg Splenda 415-593-8616

MARCUS MILLICHAP Clinton C. Textor III 415-425-9123 www.marcusmillichap.com

TOTAL AMOUNT:

URBAN GROUP REAL ESTATE Louis Cornejo 415-863-1775 louis@urbangroupsf.com

CONTACT INFORMATION Contact Person

REFINISHING / RESURFACING SERVICE

Company/Title Address City

State

MIRACLE METHOD OF SAN FRANCISCO Claire Gray 415-673-4211 www.miraclemethod.com

Zip

Mobile Phone Email Address

RENT BOARD PETITIONS

Website PAYMENT METHOD Amex

Visa

3 Digit Security Code

Card #

Expiration Date

Cardholder Name

Billing Zip Code

Authorized Signature

Date HOW DID YOU HEAR ABOUT US?

Referral From

Postcard/Mailer

Magazine

Website

Rent Board

Other

San Francisco Apartment Association 265 IVY STREET | SAN FRANCISCO, CA | 94102 | PHONE 415-255-2288 | FAX 415-255-1112

SHAMROCK REAL ESTATE COMPANY Trent Moore 415-359-2400 www.shamrocksf.com

ZEPHYR COMMERCIAL Terrence Jones 415-786-2216 terrence@terrencejonesSF.com www.terrencejones.com

ASSOCIATE MEMBER DUES: $495

Check

415-386-3111

WEST & PRASZKER REALTORS Michael Klestoff 415-312-2245 klestoffmre@aol.com

TOTAL AMOUNT:

Base Fee

S&L REALTY Robert Link www.slrealty-sf.com

VANGUARD COMMERCIAL BROKERAGE Allison Chapleau 415-516-0648 www.allisonchapleau.com

MANAGEMENT COMPANY DUES Units

PACIFIC UNION COMMERCIAL Stephen Pugh spugh@pacunion.com

TOUCHSTONE COMMERCIAL PARTNERS Matthew Gorman 415- 539-1118 mattgorman@tcpre.com

REGULAR MEMBER DUES Units

NEWMARK KNIGHT FRANK Matthew C. Sheridan 415-273-2179 aptgroupsf.com

JULY 2020 | SF APARTMENT MAGAZINE

PROPERTY MANAGEMENT SYSTEMS Michelle L. Horneff-Cohen 415-661-3860 www.propertymanagementsystems.net REAL MANAGEMENT COMPANY Melinda Greene 415-230-8895 www.RMCsf.com RENT BOARD PASSTHROUGHS Kim Boyd Bermingham 415-333-8005 www.rentboardpass.com

RENTAL LISTING SERVICES AIRBNB Lorie McBrien lorie.mcbrien@airbnb.com www.airbnb.com

949-422-7166

APARTMENT LIST Alex Mashburn 678-467-0411 amashburn@apartmentlist.com

RESIDENTIAL LEASING

BERENDT PROPERTIES Craig Berendt 415-608-3050 www.berendtproperties.com J. WAVRO ASSOCIATES James Wavro www.jwavro.com

415-509-3456

HAMILTON FAMILY CENTER Mayo Lunt 510-763-8540 x230 www.hamiltonfamiles.org LINGSCH REALTY Natalie M. Drees www.lingschrealty.com

415-648-1516

RELISTO Eric Baird www.relisto.com

415-236-6116

RENTINGSF David Chesnosky dcrentsf@gmail.com

415-218-3700

RENTSFNOW Kathy Claussen kclaussen@veritasinv.com

415-762-0213

CONTRACTOR OR VENDOR?

ARCHITECTURE & DESIGN SERVICES

Openscope Studio ATTORNEYS

Fried & Williams LLP

44 45

BANKS & LENDING SERVICES CONSTRUCTION & RENOVATION SERVICES

STRUCTURE PROPERTIES Corey Eckert 415-794-0064 www.structureproperties.com

SECURITY

ADT-MULTI FAMILY Jeanette Mendez jjmendez@adt.com www.adt.com/smart-

ad index NEED A PROFESSIONAL One Stop Maintenance W. Charles Perry West Coast Premier Construction FIRE ESCAPE SERVICE

Great Escape Fire Escape

46 62 61 60

LAUNDRY SERVICE

WASH 41 562-712-7504

MARINA SECURITY SERVICES, INC. Sam Tadesse 415-722-1168 stadesse@marinasecurities.com www.marinasecurities.com

SEISMIC RETROFIT & STRUCTURAL ENGINEERING BAI CONSTRUCTION Behnam Afshar www.baiconstruction.com

510-595-1994

SGDM, LLC George Mak www.sgdmllc.com

415-462-0619

W. CHARLES PERRY Charles Perry www.wcharlesperry.com

650-638-9546

LOCKSMITHS

Crown Lock & Safe Warman Security PAINTING CONTRACTORS

Kruit Painting Pac West Painting Peter’s Painting Services Tara Pro Painting PETITION SERVICES

Rent Board Passthroughs

47 50 58 50 60 61 61

PROPERTY MANAGEMENT & MAINTENANCE & RESIDENTIAL LEASING

Berendt Properties Gaetani Real Estate, Inc. Maven Maintenance

Real Management Company 62 Rentals in SF 39 West Coast Property Management 51 Yardi 18-19 REAL ESTATE BROKERS

Amore Real Estate 58 Coldwell / Dan McGue 21 Colliers / DeVincenti 2 Compass / Antonini 13 Compass / Bonn & Webb 29 Compass / Filly 11 Compass / Greenberg & Splenda 3 Compass / Pugh 25 Kay Properties & Investments, LLC 17 Kenney & Everest 47 Marcus & Millichap 30-31 Newmark Knight Frank / Sheridan & Boersma 63 Vanguard Commercial / Chapleau 9 Vanguard Properties / Stack 58 Vanguard Properties / Kilby Stenkamp 47 Zephyr / Terrence Jones 15 UTILITIES BILLING SERVICES

Livable 45 Acceptance of an advertisement by this magazine does not necessarily constitute any endorsement or recommendation by SFAA, express or implied, of the advertiser or any goods or services offered. Advertisers in red are Associate Members of SFAA.

6 64 39

WEST COAST PREMIER CONSTRUCTION, INC. Homy Sikaroudi, PhD, PE 510-271-0950 www.wcpc-inc.com

SUBMETERS

LIVABLE Daniel Sharabi www.livable.com

415-937-7283

TENANT PLACEMENT & LISTING REALPAGE Stacy Blackwell www.realpage.com

972-820-3015

RENTALS IN S.F. Jackie Tom www.rentalsinsf.com

415-409-3263

STRUCTURE PROPERTIES Corey Eckert 415-794-0064 www.structureproperties.com

SF APARTMENT MAGAZINE | JULY 2020

ZUMPER INC. Diana James diana@zumper.com

949-702-1508

WATER CONSERVATION SERVICE

SF PUBLIC UTILITIES COMMISSION Chandra Johnson 415-554-0704 www.conserve.sfwater.org

WATER DAMAGE SERVICE

FIRE AND WATER DAMAGE RECOVERY Maria Neumann 800-886-1801 www.waterdamagerecovery.net

FOR ALL YOUR REAL ESTATE NEEDS SERVING SAN FRANCISCO PROPERTY OWNERS FOR OVER 50 YEARS

SALES INVESTMENTS PROPERTY MANAGEMENT 3001 LAGUNA STREET, SAN FRANCISCO CA 94123 (415) 567-4800 www.amoresf.com

Many years of experience with property management companies and property owners.

Kruit Painting Inc. 415.254.7818 COMMERCIAL & RESIDENTIAL APARTMENT BUILDING SPECIALIST INTERIORS & EXTERIORS EXCELLENT REFERRALS FREE ESTIMATE 87 Loomis St., San Francisco CA 94124 www.kruitpainting.com • License No. 846351

WATERPROOFING

KELLEY PAINTING AND WATERPROOFING Mitchell Kelley 415-847-7883 www.kelleypaintingandwaterproofing.com

Please note that acceptance of associate membership does not necessarily constitute any endorsement or recommendation, express or implied, of the associate member or any goods or services offered.

Online!

Find more information on SFAA classes, apartment industry news & excerpts from SF Apartment Magazine at www.sfaa.org Mike Stack

Real Estate Advisor

Call or email me today for a free & private analysis of your property’s value.

415.580.9095 mikestack@vanguardsf.com MikeStackSF.com DRE# 01932 2 8 0

JULY 2020 | SF APARTMENT MAGAZINE

2020 Summer CCRM Series Schedule and Registration Course Course Name #

Date

PRICE

Time

Member

# of NonTotal Attendees Member

Series

Full CCRM Series (Value Savings)

See schedule below

PMR100

Introduction to Ethical Property Management

6/30/2020

1PM-3PM

$85.00

$100.00

PMR101

Renting the Property

7/2/2020

1PM-3PM

$85.00

$100.00

PMR102

Beginning and Maintaining the Tenancy:

7/7/2020

1PM-3PM

$85.00

$100.00

PMR103

Renewal of Tenancy and End of the Tenancy

7/9/2020

1PM-3PM

$85.00

$100.00

PMR104

Maintenance Management: Maintaining a Property

7/14/2020

1PM-3PM

$85.00

$100.00

PMR105

Liability & Risk Mgmt.: Protecting the Investment

7/16/2020

1PM-3PM

$85.00

$100.00

PMR106

Budget Development and Implementation

7/21/2020

1PM-3PM

$85.00

$100.00

PMR107

Fair Housing: It’s the Law

7/23/2020

1PM-3PM

$85.00

$100.00

PMR108

Professional Skills for Supervisors

7/28/2020

1PM-3PM

$85.00

$100.00

EXAM

CCRM Final Exam

7/30/2020

1PM-3PM

FREE

Total Due: Class Location Zoom Webinar System Link provided after registration Classes are every Tuesday & Thursday

To Register Online: www.sfaa.org

Call: 415-255-2288 x.113 Email: Stephanie@sfaa.org

(Includes CCRM binder and Welcome Packet; does not include the $75 CCRM application fee)

Attendee Information: o Member

Attendee Name: Title:

Company Name:

Address

City:

Phone:

Fax:

E-Mail:

Local Association ID Number:

Payment Information: o Credit Card Credit card number: Signature:

o Non Member

Zip:

o Mailing Check o Series Invoicing (members only benefit) Exp. Date

CVV________________

Name printed:

Cancellation Policy: Cancellations must be maid 48 hours prior to class for a full refund. No shows will not receive a refund. Non Member must pay by credit card only. CCRM Certification Renewal Policy: In order to keep the certification active, CCRMs must complete twelve hours of continuing education credits & submit a renewal application along with a renewal fee every other year (2 hours of these credits must be in Fair Housing)

caanet.org , ccrmeducation@caanet.org 800.967.4222 • 980 Ninth Street, Suite 1430 • Sacramento, CA 95814

SF APARTMENT MAGAZINE | JULY 2020

Legal Q&A… continued from page 16

• COMMERCIAL • RESIDENTIAL • EXTERIOR • INTERIOR

• RESTORATION • WATERPROOFING • ENVIRONMENTAL • COLOR

A. Mindful of public health during the pandemic, landlords and property managers are innovating ways to minimize direct contact, while maintaining building security and honoring tenants’ rights. Whether your tenants drop checks onsite or use the postal service, electronic payment is certainly safer. There is actually a recent statute that addresses form of payment. Of course, the legislature penned those rules to address an overheated housing crisis years in the making, and we must now maintain business while the ice breaks and shifts underneath our feet. Section 1947.3 of the Civil Code requires that landlords allow at least one form of payment that is neither cash nor electronic funds transfer (e.g., they must accept checks or money orders), and that landlords accept payments from third parties (with some conditions). The bill addresses concerns about tenant defaults and finds that easing the method of pay-

sf.0319.great.escape.pdf

3/3/19

6:34 PM

ment and payor are tools to prevent tenant displacement. Assuming the lease doesn’t already provide for EFT, you could certainly “change” the

Keeping The San Francisco Bay Area Safe Since 1988

FIRE ESCAPE SERVICE & MAINTENANCE

payment term of the tenancy to require it. But you couldn’t refuse other forms of payment, so enforcement is a non-starter. On the other hand, many banks will issue paper checks for their customers and automatically mail them out every month. Since this is neither cash nor EFT, you could presumably enforce it. (I assume these checks are printed and processed mechanically, but of course, they’re still dropped in mailboxes and handled by postal carriers, so that may not meet your goals.)

CMY

Safety is our Top Priority

A softer touch may work better. If you appeal to your tenants to enroll in EFT to enhance safety, presumably few would object.

FREE ESTIMATES

Further, if any of your tenants are withhold-

(415) 566-1479

you might incorporate an EFT provision in

ing rent during the eviction moratorium, your forbearance agreement. However, I must caution that, while we

www.greatescapeinc.com

JULY 2020 | SF APARTMENT MAGAZINE

are taking extraordinary steps to promote

safety in these uncertain times, it is generally inadvisable to allow payments through electronic portals, as it removes a safeguard of monitoring who is paying. For instance, while Section 1947.3 provides that landlords can condition third party payment on an acknowledgment that the payor is not a “tenant,” EFT conceivably permits a subtenant to begin tendering payments and building their case for a Costa-Hawkins waiver. Coincidentally, Michael Weinstein, the architect of the ballot measures to repeal Costa-Hawkins, has offered to withdraw his current initiative if the state will suspend the state law right. These are extraordinary times to be sure. But it remains important to be mindful of preserving your rights while addressing these public health issues. —Justin Goodman The information contained in this article is general in nature. Consult the advice of an attorney for any specific problem. Justin A. Goodman is with Zacks, Freedman & Patterson, P.C. and can be reached at 415-956-8100.

Passthroughs

PAY! Take advantage of the Rent Board rules that benefit you.

We prepare petitions for • Soft Story/Voluntary Seismic • General Capital Improvements • Operating and Maintenance and also • Annual Increase letters • General and Water Bond Passthroughs We have 18 years of experience and have filed hundreds of successful passthroughs. Call us today at

415-333-8005

to find out how you can benefit.

License No. 797467

Seismic & General Contractors

www.wcpc-inc.com Tel: (510) 271-0950

Conform To New Soft Story Apartment Building Seismic Ordinance San Francisco, Alameda, Oakland & Berkeley • Successful track record of seismic retrofitting numerous soft-story apartment buildings in the Bay Area. • Years of experience in cost-effective seismic retrofit design and construction—all under one company. • Guaranteed approval of engineering and construction in conformance to Soft Story Ordinance. • Screening, evaluation, engineering, construction, final city sign-off.

For inquiries, please contact Homy Sikaroudi, PhD, PE

sf.1013.west.coast.premier.indd 1

9/18/13 2020 12:32 61 PM SF APARTMENT MAGAZINE | JULY

VALUE-ADDED DEVELOPMENT

Contact : charles@wcharlesperry.com 415.509.2956

W. CHARLES PERRY & ASSOCIATES I N V E S T M E N T, D E S I G N A N D C O N S T R U C T I O N

JULY 2020 | SF APARTMENT MAGAZINE

2215 POWELL ST - NORTH BEACH - $2,700,000

Another Good One — Done! We know your buildings are part of a legacy that you’ve built with great care. When it comes to helping you sell these properties, our dedication should

• 8 Offers Received • 3 Level Commercial Building

match yours. Our singular focus is San Francisco

• Open Floor Plan

commercial real estate, which means you’ll receive

• Flex-Use Opportunity

a deeper level of expertise to help guide you to the best possible outcome from your investment. You’ve Taken The Risk Now Comes the Rewarding Part

• $581 Price per Sq. Ft. | 60 x 52 Ft. Lot

MATTHEW C. SHERIDAN

415.273.2179 License 01390209 matthew.sheridan@ngkf.com

aptGroup

TO MOST PEOPLE, THIS IS JUST ANOTHER CHARMING BUILDING IN NORTH BEACH

TO YOU, IT’S A TESTAMENT TO GENERATIONS OF YOUR FAMILY’S HARD WORK. We know the properties we manage mean more to owners like you than meets the eye. That’s why, for over 70 years and across three generations of our own family, we’ve taken the long view -- building great working relationships as we build value. Because when it comes to taking care of your investment, we definitely see eye-to-eye.

gaetanirealestate.com 415.668.1202