Corporate Rentals Move Into San Francisco’s Rent Controlled Buildings

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TO OUR ORIGINAL SERIES PROJECT HOME. AND $18 BILLION INDUSTRY IN THE U.S. SAN FRANCISCO IS AT THE CENTER OF IT. CORPORATE RENTALS. SUSIE SHOWS US HOW LANDLORDS LOOKING FOR BIG BUSINESS ARE DISRUPTING THE AFFORDABLE HOUSING MARKET. Reporter: PEOPLE ARE STARTING TO FEEL HOPELESS. THEY ARE MOVING AWAY. MY MOTHER WAS BORN HERE AND I AM NOT MOVING AWAY. Reporter: SARAH’S CHILDHOOD DREAM WAS TO LIVE IN AN APARTMENT IN THE CENTER OF SAN FRANCISCO. FOR THE PAST 10 YEARS AND HER APARTMENT WERE CABLE CARS CRISSCROSS IN FRONT OF HER DOORWAY. THAT DREAM HAS BEEN HER REALITY. A SERIES OF STRANGERS DOWN THE HALL HAVE HER WORRIED ABOUT BEING SQUEEZED OUT. YOU LOOK IN THERE LOOKS LIKE A HOTEL. Reporter: FOR THE PEOPLE RENTING THIS ROOM THAT IS ESSENTIALLY WHAT IT IS. HER ENTIRE BUILDING USED TO BE RENT-CONTROLLED APARTMENTS. RECENTLY HER LANDLORD VERITAS INVESTMENTS STARTED RENOVATING THE VACANT UNITS AND TURNING THEM INTO CORPORATE RENTALS. INTERNAL DOCUMENTS OBTAINED EXCLUSIVELY BY KPIX SHOW THIS WAS THE COMPANY’S GAME PLAN ALL ALONG. SMALL CHEAP AND QUICK IMPROVEMENTS TO CONVERT THESE RENT-CONTROLLED UNITS TO TEMPORARY FURNISHED RENTALS.>THEY TAKE AWAY FROM RENT- CONTROLLED UNITS THAT SHOULD GO TO PEOPLE LIKE MYSELF. Reporter: IS A BOOMING BUSINESS OF SAN FRANCISCO. SITES LIKE SAUNDERS AIRBNB FOR WORK AND NEARLY A DOZEN OTHERS ADVERTISED THE OPPORTUNITY TO FEEL LIKE YOU LIVE IN SAN FRANCISCO. THE SITES HAVE TO ABIDE BY SHORT-TERM RENTAL LAWS PUT IN PLACE IN 2015 THAT FOR BID RENTALS OF FEWER THAN 30 DAYS. THE SHORT-TERM RENTAL LAWS WERE INTENDED TO PROTECT SAN FRANCISCO’S PRECIOUS AND EXTREMELY EXPENSIVE HOUSING STOCK. SUPERVISOR AARON PUSH FOR THE REGULATIONS FOUR YEARS AGO.>DO YOU THINK THE CITY MADE A MISTAKE BY NOT SEEING THIS COMING A COUPLE YEARS AGO? MONEY IS LIKE WATER. IT FINDS A NEW PLACE TO FLOW. REGULATORS AND BOARDS OF SUPERVISORS ARE ALWAYS FINDING WAYS TO REGULATE NEW LOOPHOLES. A NEW FRONTIER WILL BE I DON’T KNOW. IT IS NOT TOO LITTLE TOO LATE. Reporter: HE IS PUTTING TOGETHER A NEW ORDINANCE. THIS ONE TARGETING CORPORATE RENTALS. IT WOULD MAKE IT ILLEGAL TO TURN A RENT-CONTROLLED APARTMENT INTO A CORPORATE RENTAL PERIOD. IT IS NOT AS THOUGH THEY CANNOT RENT THE UNITS FOR LOTS OF MONEY. IT IS AS IF THEY WILL HAVE TO RENT THEM TO A REAL PERSON AND THEY WILL BE SUBJECT TO RENT CONTROL. SMALL PROPERTY OWNERS ARE NOT DOING CORPORATE RENTALS. IT IS A PHENOMENON OF LARGE CORPORATE APARTMENT OWNERS. WHEN YOU LOOK AT IT BUILDING LIKE THIS YOU SEE THE SAME FLOOR LAMP IN THE SAME DESK IN EVERY SINGLE UNIT. Reporter: PUSHING FOR THE CITY TO TAKE ACTION ON CORPORATE RENTALS FOR SEVERAL YEARS. HE LIVES IN THE MISSION DISTRICT AND WORRIES ABOUT THE OTHER SIDE OF THIS BUSINESS. NEW DEVELOPMENTS THAT ARE 100% CORPORATE RENTALS. IS NOT GOING TO THE PEOPLE. Reporter: THE ORDINANCE WOULD ATTEMPT TO REGULATE THIS TOO. NEW CONSTRUCTION WOULD BE REQUIRED TO HAVE AFFORDABLE UNITS SET ASIDE. HE SAID IT IS LARGE BUILDINGS LIKE THIS THAT FRUSTRATE HIM THE MOST. BECAUSE SO MANY UNITS SIT VACANT FOR MONTHS. WE TRACK THE BUILDING AT 600 MS FOR A YEAR AND A HALF. IT HAS 40% OF UNITS ON FONDER. THEY MOSTLY REMAIN EMPTY. Reporter: THE AVERAGE CORPORATE RENTAL WILL RUN $160 A NIGHT. A HOTEL IN THE SAME NEIGHBORHOOD IS LIKELY TO BE AROUND DOUBLE THAT. A RENT-CONTROLLED UNIT IF THERE IS BUILDING THAT WENT FOR $1500 A MONTH CAN NOW FETCH NEARLY $5000. VERITAS INVESTMENTS THE OWNER OF SERAS BUILDING RELEASED THE STATEMENT THAT READS IN PART THE SHORT-TERM RENTAL UNITS CAN PROVIDE A SOLUTION FOR PEOPLE JUST MOVING INTO THE CITY AND FOR LOCALS WHO NEED A TEMPORARY PLACE TO STAY FOR VARIOUS HEALTH PROPERTY OR PERSONAL REASONS. TO BE CLEAR TOURISTS ARE NOT THE TARGET AUDIENCE FOR THESE UNITS. HE SAID FOR HIM THE BOTTOM LINE IS THIS IS YET ANOTHER LOOPHOLE IN THE EVER FLUCTUATING HOUSING MARKET. WHEN HE INTENDS TO CLOSE. SO MORE VISITORS STAY IN HOTELS AND NOT HOMES. IF THEY STAYED IN HOTELS THAT WILL HELP REDUCE THE HOUSING CRISIS AND HOUSING BURDEN. LESS PEOPLE WILL BE LOOKING FOR HOUSING. Reporter: THAT WAY TENANTS LIKE SARAH MIGHT ACTUALLY KNOW WHO THEIR NEIGHBORS ARE.>THE FEELING IT IS ERODING AWAY AT THE COMMUNITY. Reporter: WE DID REACH OUT TO AIRBNB ZOOS AND SAUNTER FOR THE STORY BUT THEY DID NOT WANT TO BE INTERVIEWED. HE WANTED TO TALK TO THEM ABOUT THIS GROWING BUSINESS. IT IS TEMPORARY HOUSING. DO WE KNOW WHO HAS BEEN RINSING THESE OUT? Reporter: THE MAJORITY OF THE PEOPLE WHO ARE RINSING THESE OUT IS TECH COMPANIES. THEY WILL OFFER A DEAL FOR NEW EMPLOYEES IF YOU COME HERE AND YOU WANT TO GET TO KNOW THE CITY. YOU CAN SPEND A COUPLE BUMPS IN ONE OF THESE CORPORATE RENTALS. THEY ARGUE IT IS SOON TO BE LOCALS WHO ARE IN THESE SPACES. WITH SO MANY THINGS THESE BIG TECH COMPANIES JUST BY THE BUILDING. IT IS CHEAPER THAN THAN PUTTING SOMEONE IN CORPORATE HOUSING SOMEWHERE ELSE. Reporter: IT IS AN EXPENSE THEY CAN WITHSTAND.>INTERESTING. REMEMBER TO SEND YOUR IDEAS

100 comments

  1. In all of this why do they keep ignoring the obvious solution of cool down their use of zoning, getting rid of the restrictions on building heights, and building more housing?

  2. Oh Sonders just moved into our building in San Diego! Just Another thing everyday hard working people have to deal with. Shame on the politicians that allow this to happen.

  3. Funny how the lawmakers are willing to do ANYTHING except for letting the developers build more units. You don't get lower cost housing by adding thousands of rules, you get it by building more houses! What a concept

  4. I have an IDEA, How about shipping these Young ARROGANT Useless IMBECILES who don't know how to do work or laborious WORK,
    LETS SHIP THEM OFF TO LIVE ON FARALLON ISLANDS . OR ALCATRAZ ISLAND.
    OR HERE IS A FEASIBLE OPTIONS LETS HAVE THEM BOARD AND STAY AND LIVE ON THE TRAVELING CRUISE LINERS
    DOCK OFF ON THE BAY. OF COURSE WITHOUT THE LUXURY MORE LIKE AN OIL TANKERS WOULD SUITE THEM. PERIOD.

  5. Won't be long before Democrats start renting those using taxpayer money to house all these illegals while they go through their fraudulent asylum claims, again getting priority over American Citizens.

  6. SF residents should be weary of trying to dictate how private entities use their property. The more regulations they pass to distort the market, the worse the housing situation gets.

    Did anyone ask WHY units are vacant or land stays undeveloped? I have a suspicion too much red tape by the city may contribute to this problem.

  7. Only city in the world that you can go to any local bar and be surrounded by millionaires, then, when you step outside, you are stepping on human poop, pee, blood, and a used needle.

  8. This apartment is for people like me, not corporate rental. Come one! If you want to own a place go buy your own, not demanding owner rent to you.

  9. Everyone talks how the "bay area is the best".

    If you like sespool oceans, overpriced everything, hot humid weather, and lots of homeless and stray dogs + cats, this is your dream place!

  10. See in that socialists City an owner cannot even take what is his and do what he would like with it

  11. Using Sarah logic, I will rent a fancy penthouse for a month and keep it for me, forever. Yay!

    You landlord fascist cannot stop my dream!

    😂😂😂😂😂😂😂

  12. Also I seen This when I was at Black Hat 2016! AirBnBeware: Short Term Rentals Long Term Pwnage

     Black Hatby Jeremy Galloway

    What's scarier, letting HD Moore rent your house and use your home network for
    day or being the very next renter that uses that network? With the
    colossal growth of the vacation rental market over the last five years
    (AirBnb, HomeAway), travellers are now more vulnerable than ever to
    network based attacks targeted at stealing personal information or
    outright pwnage. In 2006, the security industry desperately warned of
    the dangers of using public Wi-Fi at coffee shops. In 2010, we reshaped
    the conversation around the frightful security of Internet provided at
    hotels. And now, in 2016, we will start a new battle cry against the
    abysmal state of network security enabled by short term rentals. Both
    renters and property owners have a serious stake in this game. Whether
    you're renting a room in a foreign city to attend a conference or you're
    profiting off of your own empty domicile, serious risks abound: MitM
    traffic hi-jacking, accessing illegal content, device exploitation, and
    more. Common attacks and their corresponding defenses (conventional or
    otherwise) will be discussed, with a strong emphasis on practicality and
    simplicity. This talk will contain demos of attacks, introduce atypical
    hardware for defense, and encourage audience participation.

  13. believe me no mistakes or coincidences all by design putting people on the streets for greed and as long as the people of California continue voting luciferians in office nothing will change… are you all stupid ?

  14. 1:25 people like you have no business living in an expensive city. Move to Jamaica, be a beach comber and smoke weed or something. 😂

  15. Soooo Gentrification is ok when it’s hurting a specific Ethnic group… Now those who took advantage are also being taking advantage of sooo that’s why these stories are popping up more and more. Welcome to the Human Race, where if u ignore another Ethnic groups cries for help your only allowing those causing harm to know they can do this to any Ethnicity cause it doesn’t matter the color of the skin, we are all Humans. We will all get the same treatment in the end. Unless your filthy rich.

  16. They don't care. Kick all the poor out. I'd say no to letting any Corp rent have to do it the.old fashioned way. This is the reason why SF is in the bind in the first place too many corps and dummy head corps running around buying all real estate and making prices crazy. Time to end this insanity. Tech bomb is dead. Let's go back to norm.

  17. But who really wants to live there!? SF is infested with:
    – feces
    – homeless
    – sensitive and easily ofended ppl
    – and BS all around. 🤢

  18. Greed!!! Veritas, "temporary stay"! People do live temporarily in homes. How stupid the response. Hotels cost in San Francisco is extremely expensive!!! That's why they rent for $160 bucks a night.

  19. Rent control should be mandated throughout the whole u.s. People are becoming homeless. Mr. Trump should do something about this asap

  20. Hahaha San Francisco a bunch of sensitive self righteous ass wipes. What’s why the city is covered in literal shit 💩 🧻

  21. Who are these stinking broke ass people trying to dictate what the landlord could charge for his rent and do with his building???? People are so backwards

  22. So the real problem are the hotels pricing themselves really out of the market. I have observed this all over the country. What is the solution to this?

  23. If it's mine, and I paid for it with my hard work, why do you get to tell me what I can do with it? If there's a problem, are you going to fix it too, or do I get left to clean up the mess? Keep your nose out of my business!

  24. Who can afford 5k a month?! What do you do for a living? Gotta become a brain surgeon to afford a one bedroom apartment. It’s a sick and twisted.

  25. Sarah is the one making rentals unaffordable to everyone else by taking advantage of rent control and discouraging building of more rental units

  26. It's always people with low IQ that want more and more laws… "Oh, the laws we wrote ruined things? Let's write more."
    Stupid is as stupid does.

  27. Money is like lotion, soothing the wrinkly old hands of the Elites and Corporate Leaders/Executives, CEO’s, Vice Presidents, ect… Yet when I am hurt or injured, our government won’t even provide me with free healthcare because the rich need it more since they are mostly old farts with so many health problems.

  28. It's not going to people who need it…….so the people who live their don't need a place to live? then why are they there? Oh they aren't going to the people you want them to go to so it's a problem. Why don't you invite a few people who need housing over to your place and see how well that works out for you buddy. Oh you just want to complain about shit and do nothing about it. I'm sure you can jam about 5 people into your living room if you're so concerned about people not having a place to live. F'ing jackasses. Same for the rent control lady…..looks like you have plenty of room in your place.

  29. Ohhhhhhhhh ok. The democrat is upset by this. It's your stupid politicians putting this through honey! If you are living in affordable housing, you can't complain!

  30. "My mother was born here and I am not moving away from here"….. girl you should have bought a property cause you will eventually priced out. It is NOT your property. Why do renters feel so entitled? My parents were both born in Mexico guess what? I live in Dallas was born in LA…I left shithole Li A qed 7 years ago but now Dallas is turning into LA… I belong in Mexico according to that ksdy. Why am I in Dallas?

  31. We have these all over my City of Jacksonville in Florida also. It’s really nice to see the development but, to push out Locals. Or the ones in need of Housing , Big Bucks are there Target not families .

  32. Wouldn't corporate rentals fall under the law of having a licensed biz in residential housing area?
    You cant turn permanent housing into hotels, jesus.
    I remember doing tower work in san fran and our company raised our prediem from 125 a day to 250 because of high hotel costs, for those 3 weeks the three of us just drove daily to a $25 a week rv park about 65 miles away and pocketed our prediem as we usually do. But out of all the hotel prices ive seen working around country i havent seen them higher than san fran.

  33. More people feeling entitled to live somewhere just because their family lived there before them. Complete loser mentality. Move elsewhere and begin to build some wealth for your family and start your own “family area”. Don’t limit yourself to a place that doesn’t want you or you can not afford.

  34. Just because you were born in a city does not mean you should be given an apartment to live in for the price you want to pay for. Am I misunderstanding something?

  35. Cant agree more. If I am in it to make money I'll leverage it the most I can, rent control actually hurts the real estate market, pretty much live where you can afford !!

  36. Democrats fail again with these artificial loophole regulations. Stop rent control and let market decide who to rent their own properties. Rent controls dont work!

  37. Sounds like a good business strategy maybe San Francisco should build more homes make it less hard less regulations oh yeah I forgot they're in California a liberal shithole can't wait to get out

  38. Sam Francisco is a fucked up city and not kid friendly at all. I pulled up to that big park in the city and was taking my kids out of the car when out of nowhere these 3 cyclists just whizzed by at like 30mph! And 1 of them had the nerve to yell out to me “watch your kids” while almost taking my baby out. I immediately called him out and told him to “watch yourself bitch”! I yelled at him to come back but he was a techie san francisco weasel with no kids or understanding to slow down around them. Boy if i couldve touched him i would’ve grabbed his throat while pumching his ugly face.

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