Wednesday, February 24, 2010

Wall Street Journal covers CalPERS' predatory equity investments

In today's Wall Street Journal, reporter Craig Karmin covers the story of CalPERS' predatory equity investments in an article titled "Backlash Hits CalPERS Property Deals." With partners, Page Mill Properties (in East Palo Alto) and Tishman Speyer/BlackRock (in New York City), CalPERS invested some $600 million in schemes that had a devastating impact on tenants.

It's a story that has now been widely covered from the Sacramento Bee to the New York Times.

For more than a year, Tenants Together has been pressuring CalPERS to adopt policies that will prevent its involvement in predatory real estate investments that are predicated on displacing tenants to turn profits.

The WSJ report comes on the same day that Assemblyman Tom Ammiano's announcement that he will be introducing legislation to prevent state public pension funds from investing in predatory real estate investments (see previous post.)

The article includes accounts from East Palo Alto tenants who were forced to deal with Page Mill Properties' abusive practices as the city's largest landlord:

Eric Oberle, a history teacher, moved out of the East Palo Alto complex in August 2008, a few months after the new owners raised his monthly rent to $1,450 from $1,095. Page Mill officials told him that they had incorporated each property separately, which they maintained exempted them from rent-control laws.

Before he left, Mr. Oberle recalls the quality of life at his building deteriorated. "There was a Kafkaesque feeling to it," he says. "People would park their trucks in the driveway, so we couldn't get our cars out for hours. The owners removed all trees in front of the building. They would repeatedly measure the inside of the units, or would keep checking the gas, constantly invading our privacy. They wouldn't repair laundry machines, which all stopped working about the same time."

No comments:

Post a Comment