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SF’s largest landlord says it’s game to sell rent-controlled apartments to the city [Updated]

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City Hall wants Veritas Investments to put the brakes on sale of 76 old buildings

A very low-angle photo of high-rise buildings in San Francisco, including one in the center frame with blue windows. Via Google

Update: Juliana Bunim, a spokesperson for Veritas, tells Curbed SF that the company “is in touch with the Mayor’s Office of Housing and is going to work with them on selling any buildings to the city. They are open to those conversations.”

Bunim does not say whether the company will hold up any potential sales to other parties in favor of City Hall negotiations.

“Too much is at stake here to just put this huge number of rent controlled units on the market for the highest bidder, which will inevitably be a massive corporate investor,” said Supervisor Dean Preston at a Monday press conference, asking the company to stop advertising the buildings and work exclusively with the city.

Fred Sherburn-Zimmer, Executive Director of the Housing Rights Committee (HRC), appeared alongside Preston and accused Veritas of trying to “push out rent control tenants then sell the buildings for huge profits.”

Veritas lawyers gave HRC a Tuesday deadline to remove references to the 76 buildings’ addresses from their social media, alleging that the disclosure violates San Francisco law, but the deadline came and went without action.

“When a building comes up for sale, tenants always have questions and worries. We organize with tenants to replace that uncertainty with solidarity” HRC said via Facebook, calling the leak complaint a “distraction.”

One of San Francisco’s biggest and wealthiest corporate landlords, Veritas Investments, will sell more than a third of its stake in the city, putting 76 buildings and over 2,000 homes on the market. The company is noted for being the largest owner of rent-controlled housing, much of it found in neighborhoods where low-income people rely on older housing stock.

Such a large number of sales of critical buildings at once could radically change the nature of SF’s rental market—both for longtime tenants and people scrambling to find homes now.

On Monday, city lawmakers, led by Supervisor Dean Preston, plan to hold a press conference asking Veritas to stall the sales to give time for the city’s public organizations and nonprofits to buy and preserve the homes before they slip into the hands of moneyed buyers who might want to remove longtime tenants.

Veritas executive Justin Sato told the San Francisco Chronicle that, in December, the company floated the buildings to various housing nonprofits in neighborhoods like the Tenderloin, Chinatown, and the Mission.

But Preston and his backers say that wasn’t enough time to expect such bodies to plan and obtain resources to buy that many assets at once.

“Veritas needs to negotiate,” the tenant group Housing Rights Committee of San Francisco said via Facebook, adding, “They don’t need the money, we need our homes.”

The request also puts groups like the Housing Rights Committee in an awkward position, given that housing activists have frequently blasted Veritas’s policies and business decisions in the past, calling the company predatory and exploitative, and accusing it of harassing low-income renters.

But as much as some renters would welcome the idea of independence from their mega-landlord, fears that new building owners will attempt to vacate homes, demolish old buildings, or attempt other maneuvers to raise rents are running high.

The buildings vary in size, from structures as small as three units to as large as 70. Most of them date to the first 30 years of the 20th century, with some predating the 1906 earthquake.

Veritas owns approximately 5,000 homes in San Francisco. In the past, the company has referred to itself as San Francisco’s biggest landlord. Founded in 2008, Veritas started with a single six-unit building in the Mission.

“Veritas residents benefit from deep affordability, with an average rent that is close to 40 percent below market,” said CEO Yat-Pang Au in a January PR statement.

Update: On Monday, Veritas lawyers sent a complaint to the Housing Rights Committee alleging that the tenant group illegally published the addresses of the buildings on the auction block, which under the same law that required Veritas to make initial offers on the properties to local nonprofits also mandates that the addresses be kept confidential for a time.

The committee did indeed publish addresses of what it says are the relevant buildings on Facebook, qualifying the act as an attempt to alert tenants who might not realize their building is up for sale. Nobody at the advocacy group was immediately available for comment. Veritas calls the alleged leak “of the gravest concern.”