Landlords Feeling Financial Squeeze of Retrofits
LOS ANGELES—Owners of more than 13,000 “soft-story” apartment complexes and condos built before 1978 began receiving notices from the city of Los Angeles in April, informing them their buildings would likely require city-mandated retrofits for earthquake safety.
Soft-story buildings, also known as “dingbats,” generally feature first floor parking underneath second-story apartments, supported by flimsy garage walls or a pair of poles.
Popularized during the city’s post World War II expansion, these bastions of mid-century kitsch have become an iconic part of Los Angeles’ architectural landscape.
But, as the 1994 Northridge earthquake taught, dingbats are also incredibly dangerous, prone to collapse during seismic shaking unless properly reinforced.
At issue is the cost of the repairs, estimated between $60,000 and $130,000, which building owners must foot with no city assistance.
In January, the Los Angeles City Council voted to allow landlords to pass half the cost of retrofits on to tenants, including those whose buildings are rent controlled, in the form of rent increases up to $38 per month for a period of 10 years.
One local landlord, who asked not to be named, owns a rent-controlled eight-unit apartment complex on S. Wilton Place. He said he estimates his retrofit costs will land in the $75,000 range.
The property owner said he does plan to pass half of those costs on to his tenants, but only out of financial necessity.
He said he understands it will be a financial burden on his tenants, but has no other option to recoup some of his costs.
While acknowledging the retrofits are necessary, the property owner said he feels the city has unfairly saddled landlords with the bill.
“Far be it from me to say financial needs trump human lives. I just hope the city realizes that landlords aren’t the enemy,” he said.
Despite being a lifelong Angeleno, the property owner said, he is now considering moving out of state, where laws are friendlier to landlords and struggling business owners.
“It’s pretty tough,” he said. “There’s no incentive to be a landlord right now.”
Moon Sook Wheaton who purchased her building, also on S. Wilton Place, two years ago, said she had no idea at the time of purchase that her building would require earthquake retrofits.
“I paid my whole life savings to buy this property,” she said. “Right now, I’m just stunned.”
Wheaton said she has no idea where she will find the money to pay for the retrofits, and wishes the city would offer some assistance to property owners in the form of subsidies or low interest loans.
“They could come up with a city bond with a low interest rate,” said Wheaton. “That would be more fair.”
Although she said she is aware of her right to pass half of retrofit costs on to tenants, Wheaton said she does not think doing so would help her much financially.
“I have to come up with the money first,” she said. “We’re talking about a lump sum.”