SoCal Real Estate Update 🏠| WeWork La Office Impact | Karen Bass New Order

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LOS ANGELES NEWS
HOW LA MAYOR IS TACKLING THE HOUSING CRISIS WITH EXECUTIVE ORDER

ARTICLE TLDR

• The blog post reports on LA Mayor Karen Bass’ executive order to streamline the approval process for housing projects in the city, especially those that provide affordable and supportive housing for low-income and homeless residents.

• The blog post also presents some examples of housing projects that have benefited from the mayor’s initiative, as well as some of the mayor’s supporters and critics, who have different views on the effectiveness and impact of her housing policies.

Los Angeles is facing a severe housing crisis, with more than 60,000 people experiencing homelessness and a shortage of affordable and supportive housing units. To address this challenge, Mayor Karen Bass has issued an executive order that aims to streamline the approval process for housing projects in the city, especially those that provide housing for low-income and homeless residents.

The executive order, which was announced on November 8, 2023, directs various city departments to coordinate and expedite their reviews and inspections of housing projects, and to prioritize those that meet certain criteria, such as being located near transit, having at least 20 percent affordable units, or serving special needs populations. The order also establishes a Housing Delivery Team within the mayor’s office to oversee and monitor the progress of housing projects and identify any barriers or challenges.

The order is part of Bass’ “Inside Safe” program, which aims to create 25,000 new housing units by 2025 and address the city’s homelessness crisis. The program includes a range of initiatives, such as purchasing and converting hotels and motels into homeless housing, providing rental assistance and eviction prevention, and leveraging state and federal funds for affordable housing development.

The executive order has already resulted in some positive outcomes for housing projects in the city. For example, the city plans to buy and convert the Mayfair Hotel, a historic building in downtown LA, into homeless housing, with the help of a $50 million grant from the state’s Project Homekey program. The city also secured $99 million from the state’s Affordable Housing and Sustainable Communities program for four affordable housing projects that will create 466 units, including 222 for homeless and formerly homeless residents.

The mayor’s housing policies have received praise from some of her supporters, who commend her for taking bold and decisive actions to address the housing crisis. They argue that the executive order will help speed up the delivery of much-needed housing units and reduce the bureaucratic hurdles that often delay or derail housing projects. They also point out that the mayor has been able to leverage state and federal resources to fund housing projects, which shows her leadership and collaboration skills.

However, the mayor’s housing policies have also faced criticism from some of her opponents, who question the effectiveness and impact of her actions. They contend that the executive order will not solve the underlying causes of the housing crisis, such as the lack of supply, the high cost of land and construction, and the opposition from some community groups and homeowners. They also claim that the mayor has not done enough to engage with the public and stakeholders, and that some of her decisions have been made without sufficient transparency and accountability.

The executive order is expected to have a significant impact on the housing landscape in Los Angeles, as it will affect hundreds of housing projects that are currently in the pipeline or in the planning stages. The order will also set the tone for the mayor’s future housing agenda, as she enters her second year in office. Whether the order will achieve its intended goals and address the housing crisis remains to be seen, but it is clear that the mayor is determined to make housing a top priority for her administration.

NEWS
HOW A HARVARD GRAD & FORMER TV WRITER SCAMMED A BRENTWOOD DENTIST OUT OF $160,000

ARTICLE TLDR

• The blog post tells the story of how Elizabeth Hirschhorn, a Harvard grad and former TV writer, rented a luxury guesthouse in Brentwood through Airbnb and refused to leave for 18 months without paying rent, until she reached a confidential settlement with the owner.

• The blog post also exposes how Hirschhorn exploited L.A.'s tenant protection laws to avoid eviction and extort the owner, and how she had a history of similar scams and lawsuits with other landlords and agents.

If you think renting out your property through Airbnb is a safe and easy way to make some extra cash, think again. You might end up with a nightmare tenant like Elizabeth Hirschhorn, a 55-year-old Harvard graduate and former TV writer, who rented a luxury guesthouse in Brentwood in 2021 and refused to leave for 18 months without paying rent.

Hirschhorn, who claimed to be a victim of domestic violence and a disabled person, exploited L.A.'s tenant protection laws to extort the owner of the property, dentist Sascha Jovanovic, who had sued her for $60,000 in unpaid rent and $100,000 in damages. She used various tactics to avoid eviction, such as calling city inspectors to report code violations, filing counterclaims against Jovanovic, and requesting multiple extensions and postponements in court.

Hirschhorn finally moved out on November 5, 2023, after reaching a confidential settlement with Jovanovic, who had spent thousands of dollars and countless hours in legal fees and stress. Jovanovic, who expressed his relief that Hirschhorn was gone, said that he agreed to the settlement because he wanted to end the ordeal and move on with his life.

Hirschhorn, however, was not new to this kind of scam. She had a history of lawsuits and disputes with landlords, agents, and others. In 2019, she pulled off a similar stunt in Oakland, where she rented a house through Airbnb and refused to pay rent or leave. She eventually left with a cash settlement of $10,000. In 2020, she tried to sue a literary agent over an unpublished manuscript, but the case was dismissed.

Hirschhorn’s case is an extreme example of how some tenants abuse the tenant protection laws in L.A., which are meant to protect renters from unfair evictions and rent increases. The laws, however, also make it very difficult and costly for landlords to evict tenants who violate their lease agreements or cause damage to their properties. Jovanovic hopes that the city will reform its tenant protection laws to prevent such abuses in the future and to balance the rights and responsibilities of both landlords and tenants.

MULTIFAMILY NEWS
WEWORK’S WOES CONTINUE AS IT CANCELS SIX LEASES IN LA AND OC

ARTICLE TLDR

• WeWork, the co-working company that filed for bankruptcy in 2023, has canceled six leases in LA and OC, affecting more than 200,000 square feet of office space, and how this has impacted the office market and the co-working industry in the region

WeWork, the co-working giant that once had a valuation of $47 billion, has been struggling to survive since its failed IPO attempt in 2019. The company, which provides flexible office space and amenities to freelancers, startups, and corporations, has been plagued by scandals, lawsuits, and losses. In October 2023, WeWork filed for Chapter 11 bankruptcy protection, hoping to restructure its debt and operations.

As part of the bankruptcy process, WeWork has been canceling or renegotiating some of its leases across the country, including in Los Angeles and Orange County, where the company was one of the largest office tenants. According to a recent article by The Real Deal, WeWork has canceled six leases in the region, affecting more than 200,000 square feet of office space. The locations of the canceled leases are:

• Santa Monica: 520 Broadway (40,000 square feet)

• West Hollywood: 9255 Sunset Boulevard (25,000 square feet)

• Burbank: 3900 West Alameda Avenue (77,000 square feet)

• Irvine: 200 Spectrum Center Drive (36,000 square feet) and 400 Spectrum Center Drive (16,000 square feet)

• Newport Beach: 100 Bayview Circle (12,000 square feet)

The article also mentions that WeWork still has 15 leases in the region that are in flux, meaning that they could be renegotiated or terminated as part of the bankruptcy process. These leases account for more than 1.2 million square feet of office space, or about 10 percent of WeWork’s global portfolio.

WeWork’s bankruptcy has been a blow to the office market in LA and OC, where the company had signed long-term leases at high rents, often above the market average. The article cites some of the landlords who have been affected by WeWork’s lease cancellations, such as Hudson Pacific Properties, Kilroy Realty, and Douglas Emmett. These landlords now have to deal with the loss of income and the challenge of finding new tenants in a market that has been hit hard by the Covid-19 pandemic and the shift to remote work.

However, not all is gloom and doom for the co-working industry in LA and OC. The article also notes that some of WeWork’s former competitors, such as Industrious and Knotel, have been expanding their presence in the market and taking over some of WeWork’s vacated spaces. These companies have adopted a different business model than WeWork, focusing on revenue-sharing agreements with landlords rather than signing leases. This allows them to reduce their risk and offer more flexibility to their customers.

WeWork’s future in LA and OC is uncertain, as the company faces a restructuring plan that could involve selling off some of its assets and cutting its workforce. The company has also been looking for a buyer or a merger partner, but so far no deal has been announced. Whether WeWork will be able to recover from its crisis and regain its position as the leader of the co-working industry remains to be seen, but it is clear that the company has left a mark on the office landscape in LA and OC.