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Editorial
Judge developer by how it treats current residents
Sobrato Development's plans to expand the 123-unit Riviera Terrace of Los Gatos apartment complex got off to a shaky start recently. The Los Gatos Conceptual Development Advisory Committee, the first stop on the town's development highway, scoffed at the company's desire to build 100 more units on the property.
Sobrato tried to sell the idea by offering to rent the old units for "below market price," a town program that ties rent to household income. But instead of seeing more affordable housing units, the committee saw cars, lots of them, clogging Town Terrace, the only road in and out of the apartment complex. One estimate pegged the number of cars generated by 100 new units at 250.
The town countered Sobrato's proposal with a much more modest one. Director of Community Development Bud Lortz recommended building just 10 new units and renting 10 to 15 of the existing ones at a below-market price. Some tradeoff is required because the complex is already at its maximum allowed density.
Ironically--given the talk of "affordable housing"--when Sobrato took over the complex, rents increased. Even though the town limits rent increases to 5 percent annually, the new owners were able to legally jack them up to pay for improvement costs and debts incurred in the purchase of the property. Residents have seen their monthly rents go up by $400 since Sobrato bought the property and installed a new property management company in April.
A vacant 700-square-foot, one-bedroom apartment at the complex, which was built in 1961, now goes for around $1,800.
The conceptual development advisory committee was prescient in nipping the 100-unit plan in the bud; more traffic is about as welcome as scabies in Los Gatos, and the residents of the surrounding neighborhood would vehemently oppose such a scale of development.
All initial negotiations of this nature usually start far apart and eventually meet somewhere at the middle, and this case is probably no exception. But while the process continues to run its course, assuming Sobrato is willing to consider building fewer units, the town should make sure the company deals fairly with the tenants who are already paying customers.
One way to gauge Sobrato's--or any new landlord's--intentions is to monitor how they treat their current renters. For example, the developer has admitted that the existing units need work, including structural upgrades and renovations within the apartments. The town should make sure that these improvements benefit all the existing units, not just the empty ones that will command a higher rent. Also, the town should make sure that the pass-through increases are justified by the true cost and value of the improvements.
If Sobrato wants to expands the Riviera Terrace of Los Gatos apartment complex, it should prove its good intentions with what's already in place.
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Los Gatos, California Since 1881
