Over the years I’ve written about dozens of “colorful” local characters. Perhaps none was more “eccentric” than Lawrence Kates, the former co-owner of the then Santa Monica Shores. (Apparently, eccentric is what you’re called if you’re a bit nuts and very rich.)
As it happens, I was working as a security guard at the Shores the very night in 1979 that rent control passed. Mr. Kates was slightly agitated (if you consider screaming into the phone as slight) as he shouted at me threatening to demolish the towers and “make it a giant parking lot.”
Obviously he didn’t “level the buildings” as promised, but he did purposely hold apartments off the market for years hoping to bully the city into rescinding rent control (as he had done in Thousand Oaks). It didn’t work here but it left the Shores with over 150 vacancies when hordes of prospective tenants were dying to move in.
Things reversed abruptly, however, when fire codes required sprinkler systems and quick cash was needed. Seemingly, the building filled up in weeks. Among the new “tenants” was Mel Gibson. I chatted with Mel numerous times in the elevator and he was exceedingly charming. (Fortunately, my being Jewish didn’t come up in the conversations.)
Many don’t remember that rent control failed on its first attempt in 1978. In defense of Kates, shortly afterwards he was on the Michael Jackson KABC radio show urging landlords to stop gouging tenants with rent increases, which was disastrous, especially to those on fixed incomes. Kates warned that if they continued the rent control movement would likely return.
But many landlords gouged away while the gouging was good. That’s why, when rent control passed in 1979, the law used 1978 as the “base rent” period. (Kates was eccentric but also prophetic.)
Fast forward to 1999. As reported in the L.A. Times, Kates and his partners had bought the Shores for approximately $14 million in 1971. In 1999 they sold it for a Santa Monica apartment building transaction record at a whopping $95 million. Not a bad return, eh?
But back to rent control. As in all things political, the pendulum constantly swings. Starting with vacancy de-control, the pendulum currently seems to be swinging so far back this way I feel like ducking.
Numerous renters have e-mailed me with horror stories about their landlords. While the majority of landlords may be perfectly fair, the few who are bullies need to be mentioned. (At least this isn’t a repeat about Romney’s dog on the car roof.)
In two cases landlords filed unlawful detainers against long-term tenants (one senior-citizen couple who’d been there for 30 years) for items like “missing closet doorknobs.” (I couldn’t make this stuff up.) And both landlords have previous tenant harassment complaints and were sanctioned not to set foot on their own properties for five years (since elapsed)!
Imagine the panic-stricken tenants desperately trying to obtain a lawyer to avoid eviction. In one case, after a court date was set, the landlord withdrew the complaint. No harm, no foul? You decide.
Months later the same unrelated landlords each filed another unlawful detainer. Again the tenants faced eviction even though they were always current with their rent. But again, at the last minute the cases were withdrawn by the landlord. Harassment? (To a tenant fearing homelessness, it sure must feel like it.)
Speaking of the pendulum … in 2007, the California Supreme Court ruled that Santa Monica’s anti-harassment ordinance violated an owner’s ability to go to court. Therefore a landlord can file unlawful detainers and give three or 30 day notices without limit. Yes, they can still be sued for malicious prosecution, but that’s a little like saying I can still be a point guard for the Lakers. (That last-second three point shot by Steve Blake against OKC? Hey, I could have missed that shot just as easily as he did.)
There have been cases where landlords or their resident managers have harassed tenants seeking repairs, “It’s clear you’re not happy here, why don’t you move?” One manager often told tenants they “should be on meds.” (Manager or psychiatrist?)
Some landlords refuse tenant requests for improvements even when the tenant is willing to pay for it. And yet, the manager of such a building was so brazen that he added a room addition to his unit without a building permit! (I’m told he is no longer there.)
Many landlords are actually eager to go to court as the value of a rent control unit going fair market far outweighs litigation costs. Meanwhile, most tenants, desperate to keep a roof over their head, are at the mercy of legal aid. Something seems terribly unfair.
As for Kates, last I heard he had filed for bankruptcy, at least temporarily frustrating investors. I gather, however, he’s still quite rich. So I’m assuming he’s still called eccentric.
Jack can be reached at email@example.com.