City condo conversion
worries rentersChinatown residents fret about
costs if the city sells their buildings
Residents of three city-owned rental apartment buildings in Chinatown say they are worried that many of them would become homeless if the city sells their buildings to developers who convert the units to condominiums and establish a rent-to-own program.
"I love my place, and I don't want to move from it regardless of what changes are made," Theresa Pearson, who rents a studio in Marin Tower, told the City Council Budget Committee yesterday.
The city administration is proposing to sell the Marin Tower on North Nimitz, Chinatown Gateway Plaza on Nuuanu Avenue and Harbor Village on River Street and turn them into condominiums but give the current renters the opportunity to buy their apartments.
The buildings have a total of 526 apartments with a mix of rentals at market rates and affordable units at reduced rents for those who fall within low- and moderate-income levels.
The administration's plan calls for eligible tenants to use conventional and zero-interest federal loans to purchase their units with monthly mortgage payments at about the same amount as they are paying now.
"We have modified our rent-to-own program to try to address some of their concerns," Deputy Managing Director Malcolm Tom said.
For example, the plan originally required renters who did not buy to move out of their units within a year after the start of the program. That time frame is now extended to five years.
Joseph Spatola, of Marin Tower, said residents are concerned because many are renting as they are currently unable to buy property. "If nobody can afford to buy, we'd be out on the streets," Spatola said after the meeting. "Where do we go?"
City spokeswoman Carol Costa said tenants would likely qualify for conventional loans because lenders have told them that their units would provide collateral for the loan.
"If they are able to pay a certain amount now, and it ends up being relatively the same amount, then they should be able to have a home of their own someday," Costa said.
Council members expressed concern that the plan, which needs Council approval, would take 452 units out of the affordable rental market within the five years after the program would start.
"The bottom line is we want to protect the rentals for the elderly, those with special needs and who are low income," Budget Chairwoman Ann Kobayashi said.
Kobayashi said that part of the concern stems from informational meetings the administration held for tenants. "It just scares them," she said.
Tom said the administration will look into whether to maintain those units as affordable housing.
Kobayashi said the Council is looking at forming a task force of experts in real estate, appraisals and business to look at all the city property that might be put on the market.