Wednesday, May 27, 2020
Coronavirus Causes Biggest Annual Rent Growth Slowdown in at Least Five Years
Tuesday, May 26, 2020
Facebook Eyes Portland, Other Hubs, as Remote Workplaces
Facebook CEO Mark Zuckerberg has indicated half its workforce could be remote by 2030. It plans to hire new engineers in cities like Atlanta, Dallas, Denver, and Portland. It would allow employees to live within a four-hour radius of those hub cities.
Read more here and here.
Read more here and here.
Wednesday, May 20, 2020
Sold! 49 Units in Beaverton
HFO is pleased to announce its recent sale of the Fairwood Apartments in Beaverton, Oregon.
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Oregon Elections: Portland Races Head to Runoffs
Monday, May 18, 2020
Portland's Unreinforced Masonry Building Owners Receive Some Good News
In an email to unreinforced masonry (URM) owners in Portland this week, the group Save Portland Buildings announced that Mayor Wheeler has removed the city's list of URM buildings and map from the Internet last week.
The group had sought the removal of the map and list due to inaccuracies, inequities, and burdens.
Over the past weeks the organization has expanded its coalition to include the NAACP, Portland Business Alliance, Music Portland, Masonry Building Owners of Oregon, the Old Town Hospitality Group, and the Hawthorne Boulevard Business Association.
The organization indicated that Pastor E.D. Mondaine of the NAACP took the lead in the request, by sending the following letter to the Mayor:
The group had sought the removal of the map and list due to inaccuracies, inequities, and burdens.
Over the past weeks the organization has expanded its coalition to include the NAACP, Portland Business Alliance, Music Portland, Masonry Building Owners of Oregon, the Old Town Hospitality Group, and the Hawthorne Boulevard Business Association.
The organization indicated that Pastor E.D. Mondaine of the NAACP took the lead in the request, by sending the following letter to the Mayor:
5/1/2020
Mayor Wheeler and Commissioners:
In 2014, the City of Portland created the Unreinforced Masonry Building (URM) Seismic Retrofit Project to “develop a policy to require the mandatory retrofit of all URM buildings in the city and develop methods to assist building owners to implement the policy.” This initiative was led by the Portland Bureau of Emergency Management (PBEM) in collaboration with the Portland Bureau of Development Services (BDS) and Prosper Portland.
The City hoped to identify funding to mitigate URM buildings, in part to help building owners retrofit their buildings to improve building performance during an earthquake, avoid displacement and to protect Portland’s historic buildings.
On June 13, 2018, during a City Council meeting, a resolution was passed to require—effective March 1, 2019 —the placement of placards on URM buildings. The placards would include a warning to visitors in 30-point bold type that the building may be unsafe in the event of a major earthquake. Along with the placards, the City insisted upon recording a document for each affected property containing very problematic language regarding its URM status. As the Council is aware, a coalition of building owners took The City of Portland to court and on May 30, 2019, a federal judge issued an injunction against the placarding requirement.
The Court concluded that the ordinance did not compel purely factual information because it falsely identifies some buildings as unreinforced and erroneously identifies some non-URM buildings as URM. While we are grateful the ordinance was stayed, we find that the issue at the core of our coalition’s complaint has not been fully resolved. The City-maintained URM database list was hastily put together and includes many buildings that, due to upgrades or being falsely identified, should no longer be classified as URMs. For building owners to confirm that they’ve adequately improved the safety of their URMs, it can be prohibitively costly to have an engineer assess the property.
The list is a burden for building owners, making it difficult to secure loans and discouraging investment in the structures. The City of Portland acknowledges the database to be inaccurate and unable to predict building performance in an earthquake, but still requires “conclusive evidence”—a prohibitively high bar—that a building is no longer a URM in order for it to be removed from the list. Thus, the judge stated, “Some buildings, including those owned by two of the plaintiffs, remain on the list despite having been retrofitted with safety improvements.”
The NAACP asks plainly that the City-maintained online URM database list be abolished. The inherent limitations on its accuracy acknowledged by the City render it an irresponsible means of tracking this issue. Judge John Acosta, who presided over the URM placarding case wrote, Plaintiffs have demonstrated that they will suffer imminent irreparable harm if they are required to comply with the Ordinance, and that the balance of equities tips in favor of the Plaintiffs and it is in the public interest to prevent the violation of Plaintiffs’ constitutional rights."
Although we are not being ask to placard our buildings, the list still poses a threat to all building owners.
Especially at this time, during a global pandemic and pending depression, our communities are hurting. People are afraid. People are Dying. Sick. Out of work, and overwhelmed. The trajectory of a potential recovery remains uncertain. As such, the call to abolish the online URM database list has become part of our larger call for government, organizations and residents to pull together and have each other's back.
The effects of the pandemic will be with us for years. Efforts toward helping renters and small businesses will be ineffective if building owners walk away and buildings remain shuttered. No amount of relief or aid will help the recovery of our residents and small businesses if there are no buildings open to house them.
And, of course, the disproportionate effect this will have on the Black community through the acceleration of gentrification and displacement remains a looming threat. As the NAACP has pointed out before, the existence of such a list “exacerbates a long history of systemic and structural betrayals of trust and policies of displacement, demolition, and dispossession predicated on classism, racism, and white supremacy.”
The NAACP calls—unequivocally—for the leadership of this city to remove any and all burdens on these property owners and any obstacles to their recovery from this crisis. The existence of the list acts as a modern-day redlining. This regressive action by the City cannot be tolerated under normal circumstances, but is especially intolerable during an economic crisis.
Abolish the list.
/s/
E.D. Mondainé
VP - NAACP AWOSAC /
President, Portland NAACP
Coalition Partners:The Portland Business Alliance also sent the following letter:
Portland Business Alliance
Music Portland
Masonry Building Owners of Oregon
The Old Town Hospitality Group
Hawthorne Boulevard Business Association & Save Portland Buildings
May 7, 2020
Mayor Ted WheelerCommissioner
Jo Ann HardestyCommissioner
Chloe Eudaly
Commissioner Amanda Fritz
City of Portland
1221 SW 4th Avenue
Portland, OR 97204
RE: Database of unreinforced masonry buildings
Dear Mayor Wheeler & Commissioners,
The Portland Business Alliance (the Alliance) is greater Portland’s Chamber of Commerce and represents the largest, most diverse network of businesses in the region. The Alliance advocates for business at all levels of government to support commerce, community health and the region’s overall prosperity. We represent more than 1,900 members, from 27 counties, 13 states and virtually every industry sector. More than 80% of our members are small businesses.
We write today to express our support for the request from the NAACP Portland Chapter, and several other organizations, to abolish the current city database of unreinforced masonry (URM) buildings. The Alliance has supported, and continues to support, the concept of maintaining a well informed and consistently updated database of building conditions based on shared agreements. However, the current list has so many problemsand exacerbates harm from past injustices and inequities, we believe the city needs to take the actions called for by the NAACP and start over.
The problems with the current URM database are numerous, including the following:
1. The current list appears to go directly against the city’s policy of applying a racial equity lens to policy decisions and implementation. The very purpose of maintaining such a list must be clearly communicatedand be in alignment with the city’s racial equity goals, which it clearly is not in its current form.
2. If the purpose of this list were to be developed and agreed upon - with equity at the forefront - between the city, impacted stakeholders, and the community, there would also need to be a plan to develop the initial list, ensure it is “ground truth” and based on clear criteria. This list should also be regularly maintained and updated on to ensure its accuracy. This does not currently appear to be happening. This only reinforces the perception that this list targets certain communities. Additionally, building owners have told us they have non-URM buildings, or buildings that were reinforced to past standards on the list, but the process to remove them is very difficult to fulfill.
3. The maintenance and publication of this list with no specific plan to provide financial incentives and assistance to local building owners to upgrade their buildings gives the strong impression its only current purpose is to shame building owners into taking action many simply cannot afford.
The Alliance is strongly committed to continuing to be a partner in the city’s vital emergency preparedness planning work. Clearly, the entire community has a vested interest in developing a plan to ensure the entire inventory of buildings in Portland are improved to meet minimum standards of earthquake safety as quickly as possible. This is not a problem that can be solved by one sector alone. We must do the difficult work to develop a strong private, public partnership – including help from the state and federal government – to bring URMs up to modern standards. In our last communication to the city, dated 5/15/18, we expressed our opposition to the placarding proposal (which we appreciate was put on hold), and suggested alternative forms of public disclosure that would be tied to a financial plan.
The Alliance would consider supporting the development of a new list, one that is tied to a robust set of financial incentives and assistance, and tracks shared progress on a city-run, public-private retrofit program, with improvements listed, and anticipated dates of completion. This would be a much more positive, community-focused approach with shared accountability and metrics. We will also continue to advocate for state and federal assistance in solving this problem with Oregon’s leaders and congressional delegation.
We are committed to working in partnership with Rev. Mondaine and the Portland NAACP on this issue and will follow his lead on any further discussions regarding the URM list. We urge you to work with the coalition of organizations who joined their call to abolish the current list and begin again.
Sincerely,
Andrew Hoan
President & CEOWhile the list has been removed from the Internet, the organizations are awaiting a clarifying statement from City Hall.
Refusing to Pay Rent - A Cause or an Agenda?
by Zach Kosturos
President at Prime Location & Monolith Properties
There is a difference between a leader who fights for a cause for the betterment of their community and one who games the system in a hypocritical pursuit of their own agenda. In critical times such as these, we need more of the former and as few as possible of the latter.
On May 1, 2020, Renata Rollins, a member of the Olympia City Council, published an article telling her landlord that she wouldn’t be paying rent in May and didn’t know when she would start paying again, even though she hadn’t lost her job or received a reduction in pay. She called for other renters to follow her lead.
I am her landlord and I received her letter.
I would have preferred not to respond publicly, but for the health of our community, I feel I must.
Community leaders should help, not hinder
Renata is demanding free rent solely on the basis of Governor Inslee’s recently extended “stay” on evictions related to COVID-19.
That stay was put into effect to help individuals and households that are unable to pay rent because of a job loss, a reduction in hours and/or pay, and/or a business closure/reduction in revenue. Renata knows she does not qualify for special assistance, so her reason for not paying is that she wants to “preserve resources for future self.” This from a community leader?
As landlords, we are more than happy to work with tenants who find themselves out of work or in a legitimate position where they are unable to pay their rent, to the extent we are able. The vast majority of us are not greedy people getting rich by taking advantage of others. Most of us are small business owners who live and work in the community Renata talks about serving and trying to protect. We are part of her community and we provide housing, which our community desperately needs.
I have worked with Renata and with the Olympia City Council for years. Over the last several years, I have spent more hours of my time than I care to count developing a financial model to help jurisdictions, like Olympia, work with developers to make more affordable housing a reality. I have presented this work dozens of times to a wide variety of audiences in the state, and several jurisdictions in the state are currently using the model. Additionally, I sit on the City’s Home Fund Advisory Committee that is tasked with helping the City award funding to developers looking to build housing for our community’s most vulnerable populations. I have given my time and my expertise to the City, without pay or compensation of any kind because I, like so many other real estate professionals I know, care about my community and because I want to help those who are less fortunate have a chance at a better future. It is short-sighted actions like Renata’s that make private sector professionals, like me, hesitant to work with the public sector.
As an elected leader who professes to care deeply about housing, Renata should educate herself as to how the industry works. Unfortunately, her lack of understanding undermines the entire housing system in Olympia and, especially, the affordable housing she says she champions.
She fails to recognize that landlords have bills to pay too. Landlords don’t get bailouts, and we have no moratorium on paying Renata’s water, sewer and garbage bills, her toilet repair costs, her roof repairs, or paying taxes or the salaries of our employees who look after the unit that she says she loves.
And why is it that Renata believes some products/services are more worthy of payment than her rent? Why does she believe the City should get paid for its water, sewer, and garbage service but that her landlord shouldn’t get paid for providing her with housing?
Should I be able to go to the grocery store or coffee shop and take their goods without paying? Should I be able to stop paying sales tax, property tax, B&O tax, payroll tax, and every other tax if I decide that I don’t like the taxation system? Should we all stop paying medical professionals for their expertise because “healthcare is a human right”?
Why do Renata and people who share her viewpoint, feel as though they should get to decide who gets paid for the work they do and the value they create and to what extent? That’s a very slippery slope.
Our economic system is much more complicated than she thinks
Renata seems to think that there is a simple solution, that if we enact a long-term mortgage/rent moratorium (and raise people's taxes, which is a whole other issue) everything will work out just fine. What she fails to understand is that PEOPLE own those mortgages. Those mortgages are part of tens of thousands, more likely, millions of Americans' retirement portfolios. Most mortgages are ultimately owned by endowment funds, pensions (including those for teachers, firefighters, police, and state workers), and individual investors all throughout our country. When we stop paying those, the people who rely on the passive income they create, many in retirement, are greatly harmed. When we stop paying bills, the result is, people in our communities suffer.
The reality of the financial world today is that it's all interconnected. You can't just take from those "who have" without it negatively affecting those who don't. Renata seems to miss that fact and here's an example...
She “has” the ability to pay her rent. She is refusing.
Her neighbor may not have the ability to pay his/her rent.
Both of them are asking for rent relief.
We must now negotiate with Renata and her neighbor instead of just her neighbor, who actually needs help.
Now we have less ability to help her neighbor because we are having to help her, even though she doesn’t need it. She is actually hurting her own cause.
Additionally, an unintended consequence may be that now people like me and my clients may not want to be property owners in Olympia and may stop investing or reduce our investments in real estate, thus reducing the availability of housing and increasing its real cost to people like her and her neighbor.
You see, in this scenario, Renata is the one taking from her neighbors - fellow community members - who are actually in great need. She says she’s doing it to "help the community” and to make a statement, but she didn't think it all the way through. She didn't see the full picture when she made her decision.
A glaring contradiction
Renata also stated to us that she wanted to save money for an unknown future. So, is it that she’s wanting to help the community or that she’s wanting to help herself?
Her statements are contradictory in nature. This is so often the case when we see these kinds of positions being taken. On the surface, they look like compassionate, “others-centered” acts but when the onion is peeled back, too frequently, it’s actually not about others at all. A true others-centered response, from a true leader, would have been to tell us that she was paying her rent so that we would have the ability to help more people who really couldn’t pay theirs.
She also stated that she thinks property owners should open their books and offer transparency so that people like her could "understand your business model and investment strategy.” Aside from that being a ridiculous statement, I can say I have already done that with the Housing Model the City of Olympia, and its City Council, are in possession of and have been using. It clearly shows everything Renata could want to see. Second, it takes about two minutes to do a Google search and find the kind of information she is looking for. Third, what business is it of hers what someone's business model and/or investment strategy is unless she’s interested in investing? Fourth, should every tenant be subjected to landlords scrutinizing their purchasing behavior and offering advice as to how to better spend, save, and invest their money? Come on. Her request is ridiculous, and I think she’d be appalled if I asked our tenants to let us scrutinize their finances to that degree.
What should happen during this time is that people who can pay their bills should keep paying their bills so we can help the people who actually need it. Now, that would be true community-minded action. Furthermore, that's how we will keep the entire economic system from becoming unrepairable. That's how we will mitigate the economic damage to the greatest extent possible.
My company houses more than 1,500 households in the area and since this lockdown began, we have been responding to those who live in our properties who have reached out to us for rent relief. Renata is the ONLY person who has stated she will not be paying rent though she has the ability. Every other tenant on our list has actually lost a job, had their pay cut, and/or their business closed. The other requests we’ve received have been honest and earnest explanations of need. She has only hindered, not helped their cause and the purpose of the Governor’s eviction moratorium.
Lead with integrity
Because their signature on a lease means something to them, the vast majority of our tenants who have requested rent relief have communicated that they will pay whatever they can, when they can. They are taking responsibility for the agreement they signed their name to. We are working every day with individuals on plans to ensure they stay in their homes. Stonewalling the payment of rent, when one is fully capable, lacks integrity, accomplishes nothing, and is a stark contrast to our other tenants' respectable and dignified requests. She would do well to follow their example.
Renata, you are an elected official. You are a community leader. What you are encouraging others to do is reckless and could result in irreparable damage to the people you say you care about. That’s not what good leaders do.
Our community doesn't need a politically motivated action right now. We don’t need our leaders working to incite even more conflict and destruction. Our community needs leaders who will work toward the good of all.
True leadership, at least in my opinion, would be to pay your rent because you can, even though you don't know what tomorrow may bring. True leadership would be to advocate through the proper channels for those in need without personally taking advantage of the system and, as a result, harming the people who truly need help. True leadership would be to encourage your constituents that while the system is far from perfect and certainly needs some fixing, our first priority is to get through this together and that gaming the system won't help us get through it, rather, it will make it worse.
True leadership would be to rally people to do what's right and what's right, at least as it relates to rent, is to be a person of your word and abide by the agreement you signed (as we have done) and pay your rent (and your other bills).
Zach Kosturos is the President of Prime Locations, Inc, a commercial brokerage firm. As a business owner, he has taken an active role in serving the community. He has been a key contributor to innovative solutions for increasing affordable housing in Thurston County.
President at Prime Location & Monolith Properties
There is a difference between a leader who fights for a cause for the betterment of their community and one who games the system in a hypocritical pursuit of their own agenda. In critical times such as these, we need more of the former and as few as possible of the latter.
On May 1, 2020, Renata Rollins, a member of the Olympia City Council, published an article telling her landlord that she wouldn’t be paying rent in May and didn’t know when she would start paying again, even though she hadn’t lost her job or received a reduction in pay. She called for other renters to follow her lead.
I am her landlord and I received her letter.
I would have preferred not to respond publicly, but for the health of our community, I feel I must.
Community leaders should help, not hinder
Renata is demanding free rent solely on the basis of Governor Inslee’s recently extended “stay” on evictions related to COVID-19.
That stay was put into effect to help individuals and households that are unable to pay rent because of a job loss, a reduction in hours and/or pay, and/or a business closure/reduction in revenue. Renata knows she does not qualify for special assistance, so her reason for not paying is that she wants to “preserve resources for future self.” This from a community leader?
As landlords, we are more than happy to work with tenants who find themselves out of work or in a legitimate position where they are unable to pay their rent, to the extent we are able. The vast majority of us are not greedy people getting rich by taking advantage of others. Most of us are small business owners who live and work in the community Renata talks about serving and trying to protect. We are part of her community and we provide housing, which our community desperately needs.
I have worked with Renata and with the Olympia City Council for years. Over the last several years, I have spent more hours of my time than I care to count developing a financial model to help jurisdictions, like Olympia, work with developers to make more affordable housing a reality. I have presented this work dozens of times to a wide variety of audiences in the state, and several jurisdictions in the state are currently using the model. Additionally, I sit on the City’s Home Fund Advisory Committee that is tasked with helping the City award funding to developers looking to build housing for our community’s most vulnerable populations. I have given my time and my expertise to the City, without pay or compensation of any kind because I, like so many other real estate professionals I know, care about my community and because I want to help those who are less fortunate have a chance at a better future. It is short-sighted actions like Renata’s that make private sector professionals, like me, hesitant to work with the public sector.
As an elected leader who professes to care deeply about housing, Renata should educate herself as to how the industry works. Unfortunately, her lack of understanding undermines the entire housing system in Olympia and, especially, the affordable housing she says she champions.
She fails to recognize that landlords have bills to pay too. Landlords don’t get bailouts, and we have no moratorium on paying Renata’s water, sewer and garbage bills, her toilet repair costs, her roof repairs, or paying taxes or the salaries of our employees who look after the unit that she says she loves.
And why is it that Renata believes some products/services are more worthy of payment than her rent? Why does she believe the City should get paid for its water, sewer, and garbage service but that her landlord shouldn’t get paid for providing her with housing?
Should I be able to go to the grocery store or coffee shop and take their goods without paying? Should I be able to stop paying sales tax, property tax, B&O tax, payroll tax, and every other tax if I decide that I don’t like the taxation system? Should we all stop paying medical professionals for their expertise because “healthcare is a human right”?
Why do Renata and people who share her viewpoint, feel as though they should get to decide who gets paid for the work they do and the value they create and to what extent? That’s a very slippery slope.
Our economic system is much more complicated than she thinks
Renata seems to think that there is a simple solution, that if we enact a long-term mortgage/rent moratorium (and raise people's taxes, which is a whole other issue) everything will work out just fine. What she fails to understand is that PEOPLE own those mortgages. Those mortgages are part of tens of thousands, more likely, millions of Americans' retirement portfolios. Most mortgages are ultimately owned by endowment funds, pensions (including those for teachers, firefighters, police, and state workers), and individual investors all throughout our country. When we stop paying those, the people who rely on the passive income they create, many in retirement, are greatly harmed. When we stop paying bills, the result is, people in our communities suffer.
The reality of the financial world today is that it's all interconnected. You can't just take from those "who have" without it negatively affecting those who don't. Renata seems to miss that fact and here's an example...
She “has” the ability to pay her rent. She is refusing.
Her neighbor may not have the ability to pay his/her rent.
Both of them are asking for rent relief.
We must now negotiate with Renata and her neighbor instead of just her neighbor, who actually needs help.
Now we have less ability to help her neighbor because we are having to help her, even though she doesn’t need it. She is actually hurting her own cause.
Additionally, an unintended consequence may be that now people like me and my clients may not want to be property owners in Olympia and may stop investing or reduce our investments in real estate, thus reducing the availability of housing and increasing its real cost to people like her and her neighbor.
You see, in this scenario, Renata is the one taking from her neighbors - fellow community members - who are actually in great need. She says she’s doing it to "help the community” and to make a statement, but she didn't think it all the way through. She didn't see the full picture when she made her decision.
A glaring contradiction
Renata also stated to us that she wanted to save money for an unknown future. So, is it that she’s wanting to help the community or that she’s wanting to help herself?
Her statements are contradictory in nature. This is so often the case when we see these kinds of positions being taken. On the surface, they look like compassionate, “others-centered” acts but when the onion is peeled back, too frequently, it’s actually not about others at all. A true others-centered response, from a true leader, would have been to tell us that she was paying her rent so that we would have the ability to help more people who really couldn’t pay theirs.
She also stated that she thinks property owners should open their books and offer transparency so that people like her could "understand your business model and investment strategy.” Aside from that being a ridiculous statement, I can say I have already done that with the Housing Model the City of Olympia, and its City Council, are in possession of and have been using. It clearly shows everything Renata could want to see. Second, it takes about two minutes to do a Google search and find the kind of information she is looking for. Third, what business is it of hers what someone's business model and/or investment strategy is unless she’s interested in investing? Fourth, should every tenant be subjected to landlords scrutinizing their purchasing behavior and offering advice as to how to better spend, save, and invest their money? Come on. Her request is ridiculous, and I think she’d be appalled if I asked our tenants to let us scrutinize their finances to that degree.
What should happen during this time is that people who can pay their bills should keep paying their bills so we can help the people who actually need it. Now, that would be true community-minded action. Furthermore, that's how we will keep the entire economic system from becoming unrepairable. That's how we will mitigate the economic damage to the greatest extent possible.
My company houses more than 1,500 households in the area and since this lockdown began, we have been responding to those who live in our properties who have reached out to us for rent relief. Renata is the ONLY person who has stated she will not be paying rent though she has the ability. Every other tenant on our list has actually lost a job, had their pay cut, and/or their business closed. The other requests we’ve received have been honest and earnest explanations of need. She has only hindered, not helped their cause and the purpose of the Governor’s eviction moratorium.
Lead with integrity
Because their signature on a lease means something to them, the vast majority of our tenants who have requested rent relief have communicated that they will pay whatever they can, when they can. They are taking responsibility for the agreement they signed their name to. We are working every day with individuals on plans to ensure they stay in their homes. Stonewalling the payment of rent, when one is fully capable, lacks integrity, accomplishes nothing, and is a stark contrast to our other tenants' respectable and dignified requests. She would do well to follow their example.
Renata, you are an elected official. You are a community leader. What you are encouraging others to do is reckless and could result in irreparable damage to the people you say you care about. That’s not what good leaders do.
Our community doesn't need a politically motivated action right now. We don’t need our leaders working to incite even more conflict and destruction. Our community needs leaders who will work toward the good of all.
True leadership, at least in my opinion, would be to pay your rent because you can, even though you don't know what tomorrow may bring. True leadership would be to advocate through the proper channels for those in need without personally taking advantage of the system and, as a result, harming the people who truly need help. True leadership would be to encourage your constituents that while the system is far from perfect and certainly needs some fixing, our first priority is to get through this together and that gaming the system won't help us get through it, rather, it will make it worse.
True leadership would be to rally people to do what's right and what's right, at least as it relates to rent, is to be a person of your word and abide by the agreement you signed (as we have done) and pay your rent (and your other bills).
Zach Kosturos is the President of Prime Locations, Inc, a commercial brokerage firm. As a business owner, he has taken an active role in serving the community. He has been a key contributor to innovative solutions for increasing affordable housing in Thurston County.
Saturday, May 16, 2020
Survey: 11.8% of Oregon Renters Unable to Pay Full Rent in May
Multifamily NW and the Rental Housing Alliance collaborated to collect 519 surveys of housing providers to establish the impact on May 2020 rent payment of the COVID -19 crisis that has resulted in mass layoffs.
Roughly 20 percent of first-time unemployment claims came from accommodation and food services sectors, followed by the arts and entertainment sector, services, construction, and health care. A disproportionate share of initial unemployment claims occurred for those aged 25-34 – the same population that is likely to rent their housing and have accumulated fewer financial reserves to withstand an interruption in household income.
The survey asked: How many households were unable to pay full rent by the 8th of May? The study also adjusted for vacant units to arrive at the actual percentage of renters impacted. The broader impact on the market can, therefore, be extrapolated from these numbers.
Note: Survey results exclude vacant units.
Source: Multifamily NW Association, Rental Housing Alliance
Roughly 20 percent of first-time unemployment claims came from accommodation and food services sectors, followed by the arts and entertainment sector, services, construction, and health care. A disproportionate share of initial unemployment claims occurred for those aged 25-34 – the same population that is likely to rent their housing and have accumulated fewer financial reserves to withstand an interruption in household income.
The survey asked: How many households were unable to pay full rent by the 8th of May? The study also adjusted for vacant units to arrive at the actual percentage of renters impacted. The broader impact on the market can, therefore, be extrapolated from these numbers.
- Overall in the State of Oregon, 11.8% of renter households were unable to pay rent in May.
- Statewide, of renter households living in Affordable Tax Credit units, 11.8% were unable to pay rent, which was consistent for the average of Oregon.
- The impact is more significant for households living in non-assisted, conventional “Class-C” workforce multifamily housing, which experienced a 17.8% inability to pay rent.
- Renters in single-family homes or duplexes within the city of Portland reported the highest inability to pay, at 22.7%..
- Few Housing Providers reported Rent-Strikes or similar protest activity.
- The survey data strongly suggests that the households living in moderately priced, conventionally financed apartments, or renting duplex/single-family detached homes are most in need of Short-Term Emergency Rental Assistance.
Note: Survey results exclude vacant units.
Source: Multifamily NW Association, Rental Housing Alliance
Wednesday, May 13, 2020
Sold! HFO announces sale of 82 Units in SW Portland for $24.5 million
HFO Investment Real Estate is pleased to announce the sale of Bethany West Apartments. This 82-unit asset in the Bethany neighborhood. This turnkey property features a diverse unit mix of large one-, two-, and three-bedroom units. Washington County remains the metro area's economic powerhouse.
Contact our office at (503) 241-5541 for additional information on this and other available listings, and visit our website at www.hfore.com for representative current listings.
Contact our office at (503) 241-5541 for additional information on this and other available listings, and visit our website at www.hfore.com for representative current listings.
Tuesday, May 12, 2020
Congressional Democrats Release Details of $3 Trillion Stimulus Plan, Including $100 Billion for Renters
Monday, May 11, 2020
HFO Multifamily Marketwatch - May 11, 2020
Oregon Governor Kate Brown faces complaints about her extension of Oregon’s state of emergency through July 6th; as activists across the country call for rent forgiveness, others are urging municipal governments to buy distressed properties.
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Governor Kate Brown announced on May 1st that she is extending Oregon’s state of emergency to July 6th. The extension allows the Governor to end statewide closures earlier if needed, but it gives the state room to implement a more gradual, incremental reopening of businesses and other services. Brown’s spokesman Charles Boyle emphasizes that the state’s plans for allowing people out of their homes will be based on science and data. But not all state leaders are supportive of Brown’s decision. The mayors of the Clackamas County cities of Molalla, Oregon City, Canby, Gladstone, and Sandy are urging the Governor to move more quickly. Brown’s benchmark for reopening rural counties requires these areas to create a workable system for testing, tracing, and treating COVID-19. The earliest she expects some rural counties to open is May 15th. The Mayors argue that reopening should be up to local jurisdictions, not just counties as a whole. At the mayors’ press conference last week, Oregon City Mayor Dan Holladay called on churches to reopen as an example for the rest of the state. Sandy Mayor Stan Pulliam believes that only the elderly are at risk in Oregon, and argues that this is not enough of a reason to keep businesses across the state closed. University of Oregon economics professor Tim Duy disagrees. Duy argues that state and federal safety nets are insufficient to meet this moment and says a second wave of the pandemic is likely, necessitating an additional future lockdown.
The Oregon Legislature released its rental assistance funding last week, to help low-income Oregonians who have been impacted by the COVID-19 pandemic. The state allocated a total of $12 million to address housing and homelessness – including $8.5 million for rental assistance, and $3.5 million for homeless services. The rental assistance funding was distributed to nonprofit and government housing agencies last week. In addition, Oregon Housing and Community Services is expecting $14.9 million from the federal government that is earmarked for housing vouchers, rental assistance, and utility payments. The $3.5 million set aside by the legislature for hotel vouchers and homeless services has not yet been distributed. A large portion of this funding will go toward housing for migrant and seasonal farmworkers, and the state has little experience administering this type of accommodation. The state is instructing Oregonians who think they qualify for rental assistance to call 211 for more information. Oregonian – Oregon Releases $12 Million in Housing Funds: Here’s What It’s for and How You Can Benefit
As the May 19th Oregon primary approaches, the Willamette Week reports that in Portland, political outsiders are attracting more individual donors than incumbents. Sarah Iannarone, one of the frontrunners in Portland’s mayoral race, has close to 3,000 donors – the most of any city candidate. These donations are eligible to be matched through Portland’s Open and Accountable Elections program. Ted Wheeler, the incumbent in the race, is not participating in the public financing program. He has received donations from just 354 individual donors in this election. The candidates for City Council who have attracted the highest number of donors are Carmen Rubio, who is running for Position 1, Margot Black for Position 2, and Mingus Mapps for Position 4. While Rubio has attracted around 370 more donors than her closest competitor, Candace Avalos, the other races appear tighter. While 805 donors have given to Margot Black, 717 have contributed to Dan Ryan’s campaign. In the race for Position 4, Mingus Mapps has 981 donors – just 13 more than Sam Adams. It is important to note, however, that the number of individual donors does not necessarily mean these candidates are frontrunners in their races. It will be up to each campaign to ensure that these donations can be translated into actual votes. Willamette Week – Political Outsiders Are Gathering the Most Individual Contributions in Their Bids for the Portland City Council
ABC News reports that as of May 1st, over 30 million Americans have filed for unemployment assistance since the COVID-19 pandemic began. Also, several workers have been furloughed or had their hours cut. To mitigate this sudden widespread loss of household income, many cities and states have implemented short-term eviction moratoriums for nonpayment of rent. These moratoriums allow vulnerable residents to stay in their homes during the ongoing emergency, but once stay at home orders are lifted, rents are set to come due even if the economy has not fully recovered. According to the University of Buffalo urban and regional planning professor Henry Louis Taylor Jr, this is likely to lead to mass evictions and permanent displacement in cities with low vacancy rates and high demand for rental units. Also, some smaller landlords may end up needing to sell their units, reducing the overall supply of rentals. And while the federal government has issued a moratorium on foreclosures for properties backed by federal loans, only 12.3 million of the nation’s 43.9 million rental units are federally financed. Emily Benfer of Columbia University’s Health Justice Advocacy Clinic agrees with Professor Taylor and argues that federal and state governments have not done enough to ensure housing stability. She believes that leaving renters and landlords to deal with this on their own will create a more significant economic crisis. The patchwork of protections and subsidies for renters and landlords is insufficient for the current level of need. It will likely exacerbate housing crises in cities and states that were already struggling with affordability issues before the pandemic. ABC News – “Mass Evictions” on the Horizon as the US Confronts Coronavirus Housing Crisis: Advocates
The Portland Business Journal reports that home services plan provider Frontdoor Inc.’s acquisition of Portland-based startup Streem is allowing the company to provide new tools to real estate and construction professionals who are practicing social distancing. Frontdoor is providing free access to an augmented reality tool developed by Streem to contractors and real estate agents to facilitate remote interactions. The augmented reality tool allows home repair professionals to remotely diagnose issues with plumbing or appliances to minimize the need for on-site services. The AR tool also allows real estate agents to conduct tours and facilitate inspections without needing physical access to the seller’s home. The device is being rolled out in select markets, starting with real estate brands owned by Realogy and Howard Hanna. PBJ – Portland AR Company’s Technology Made Available to Real Estate Agents, Home Contractors
Counties in Southwest Washington recently found out how much funding they will be receiving from the federal CARES Act, but questions remain regarding how that money can be spent. Clark County will receive $26 million from the federal government, while its largest city, Vancouver, will receive $5.5 million. Neighboring Cowlitz County will get $6 million, and the town of Longview expects $1.14 million. But this federal funding will be a drop in the bucket compared to what is needed, and the municipalities worry that they will not be able to use it to address some of the most pressing local needs. Vancouver is expecting a drop in revenue amounting to $45 million, primarily due to the sudden slowdown in construction activity and declining sales tax revenue. Clark County expects its revenues to drop by $13 million, while Longview is planning to lose $4 million. As the cities and counties wait for additional guidance from the federal government, they are forced to make tough decisions in the short term. At least 300 city workers in Vancouver found out last week that they will be subject to temporary pay cuts. Much of the federal aid is likely to be directed toward contact tracing initiatives, which public health experts argue is necessary for the reopening of local businesses and services. OPB – Struggling SW Washington Counties to Get Millions in Federal Aid for Coronavirus Costs
The State of Oregon has approved a land sale in Bend that will allow a large mixed-use project to continue moving forward. Late last month, the State agreed to sell a 382-acre parcel located within Bend’s urban growth boundary to California-based developer Lands Bend Corp. The plot is located at the intersection of Stevens Road and 27th Street on the eastern edge of the city of Bend. The $22 million sale was approved by Oregon’s Land Board late last year and is scheduled to close later this year, pending a due diligence period. The developer will conduct a master plan process to include input from the Bend community on the details. Still, the preliminary plan is for a, quote, “complete community with a mix of housing and employment types.” The state expects the development to generate $450 million in economic activity and over 800 jobs by 2028. DJC – Bend Development Plans Advance with Land Sale
Finally, CityLab reports that some tenant advocates are expanding their calls for canceling rent into more significant ideas for more sweeping systemic changes. With sharply increasing unemployment and limited federal funding for rent subsidies, the idea of canceling rent has been brought into the mainstream, despite warnings from economists that it could have broader negative impacts on the economy. A new grassroots coalition, United for a New Economy, recently launched a platform called Our Homes, Our Health, which is advocating for lawmakers at all levels to suspend rent and mortgage payments for the duration of the emergency. The group has gained the support of progressive politicians, including Representatives Alexandria Ocasio-Cortez and Ilhan Omar. Chris Schildt, the senior associate for national research group PolicyLink, argues that it will not be enough to temporarily cancel rent and then go back to business as usual. In his words, the pre-pandemic “status quo was a perennial crisis.” To this end, the Our Homes, Our Health policy platform includes ideas for turning privately owned rentals into public housing. One part of the plan advocates for cities to use eminent domain to purchase AirBnBs and luxury housing. Also, the plan’s “Buy-Outs Not Bailouts” policy encourages public housing agencies to buy rental units from smaller landlords who are struggling with reduced income. Advocates believe these measures would prevent the corporate buyouts that were ubiquitous after the last recession. While these plans may have sounded like fantasies a few months ago, as more and more renter households find themselves in precarious situations, municipalities may become more open to drastic actions. CityLab – “Cancel the Rent” Could Be Just the Beginning
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Read the text below:
Governor Kate Brown announced on May 1st that she is extending Oregon’s state of emergency to July 6th. The extension allows the Governor to end statewide closures earlier if needed, but it gives the state room to implement a more gradual, incremental reopening of businesses and other services. Brown’s spokesman Charles Boyle emphasizes that the state’s plans for allowing people out of their homes will be based on science and data. But not all state leaders are supportive of Brown’s decision. The mayors of the Clackamas County cities of Molalla, Oregon City, Canby, Gladstone, and Sandy are urging the Governor to move more quickly. Brown’s benchmark for reopening rural counties requires these areas to create a workable system for testing, tracing, and treating COVID-19. The earliest she expects some rural counties to open is May 15th. The Mayors argue that reopening should be up to local jurisdictions, not just counties as a whole. At the mayors’ press conference last week, Oregon City Mayor Dan Holladay called on churches to reopen as an example for the rest of the state. Sandy Mayor Stan Pulliam believes that only the elderly are at risk in Oregon, and argues that this is not enough of a reason to keep businesses across the state closed. University of Oregon economics professor Tim Duy disagrees. Duy argues that state and federal safety nets are insufficient to meet this moment and says a second wave of the pandemic is likely, necessitating an additional future lockdown.
- Oregonian – Governor Kate Brown Extends Oregon Coronavirus State of Emergency to July 6th
- Willamette Week – Five Clackamas County Mayors Urge the Governor to Roll Out a “Decisive Action” Plan to Reopen the Economy
- OPB – As Some Push to Open Oregon Faster, Public Confidence Is Key to Economic Recovery
The Oregon Legislature released its rental assistance funding last week, to help low-income Oregonians who have been impacted by the COVID-19 pandemic. The state allocated a total of $12 million to address housing and homelessness – including $8.5 million for rental assistance, and $3.5 million for homeless services. The rental assistance funding was distributed to nonprofit and government housing agencies last week. In addition, Oregon Housing and Community Services is expecting $14.9 million from the federal government that is earmarked for housing vouchers, rental assistance, and utility payments. The $3.5 million set aside by the legislature for hotel vouchers and homeless services has not yet been distributed. A large portion of this funding will go toward housing for migrant and seasonal farmworkers, and the state has little experience administering this type of accommodation. The state is instructing Oregonians who think they qualify for rental assistance to call 211 for more information. Oregonian – Oregon Releases $12 Million in Housing Funds: Here’s What It’s for and How You Can Benefit
As the May 19th Oregon primary approaches, the Willamette Week reports that in Portland, political outsiders are attracting more individual donors than incumbents. Sarah Iannarone, one of the frontrunners in Portland’s mayoral race, has close to 3,000 donors – the most of any city candidate. These donations are eligible to be matched through Portland’s Open and Accountable Elections program. Ted Wheeler, the incumbent in the race, is not participating in the public financing program. He has received donations from just 354 individual donors in this election. The candidates for City Council who have attracted the highest number of donors are Carmen Rubio, who is running for Position 1, Margot Black for Position 2, and Mingus Mapps for Position 4. While Rubio has attracted around 370 more donors than her closest competitor, Candace Avalos, the other races appear tighter. While 805 donors have given to Margot Black, 717 have contributed to Dan Ryan’s campaign. In the race for Position 4, Mingus Mapps has 981 donors – just 13 more than Sam Adams. It is important to note, however, that the number of individual donors does not necessarily mean these candidates are frontrunners in their races. It will be up to each campaign to ensure that these donations can be translated into actual votes. Willamette Week – Political Outsiders Are Gathering the Most Individual Contributions in Their Bids for the Portland City Council
ABC News reports that as of May 1st, over 30 million Americans have filed for unemployment assistance since the COVID-19 pandemic began. Also, several workers have been furloughed or had their hours cut. To mitigate this sudden widespread loss of household income, many cities and states have implemented short-term eviction moratoriums for nonpayment of rent. These moratoriums allow vulnerable residents to stay in their homes during the ongoing emergency, but once stay at home orders are lifted, rents are set to come due even if the economy has not fully recovered. According to the University of Buffalo urban and regional planning professor Henry Louis Taylor Jr, this is likely to lead to mass evictions and permanent displacement in cities with low vacancy rates and high demand for rental units. Also, some smaller landlords may end up needing to sell their units, reducing the overall supply of rentals. And while the federal government has issued a moratorium on foreclosures for properties backed by federal loans, only 12.3 million of the nation’s 43.9 million rental units are federally financed. Emily Benfer of Columbia University’s Health Justice Advocacy Clinic agrees with Professor Taylor and argues that federal and state governments have not done enough to ensure housing stability. She believes that leaving renters and landlords to deal with this on their own will create a more significant economic crisis. The patchwork of protections and subsidies for renters and landlords is insufficient for the current level of need. It will likely exacerbate housing crises in cities and states that were already struggling with affordability issues before the pandemic. ABC News – “Mass Evictions” on the Horizon as the US Confronts Coronavirus Housing Crisis: Advocates
The Portland Business Journal reports that home services plan provider Frontdoor Inc.’s acquisition of Portland-based startup Streem is allowing the company to provide new tools to real estate and construction professionals who are practicing social distancing. Frontdoor is providing free access to an augmented reality tool developed by Streem to contractors and real estate agents to facilitate remote interactions. The augmented reality tool allows home repair professionals to remotely diagnose issues with plumbing or appliances to minimize the need for on-site services. The AR tool also allows real estate agents to conduct tours and facilitate inspections without needing physical access to the seller’s home. The device is being rolled out in select markets, starting with real estate brands owned by Realogy and Howard Hanna. PBJ – Portland AR Company’s Technology Made Available to Real Estate Agents, Home Contractors
Counties in Southwest Washington recently found out how much funding they will be receiving from the federal CARES Act, but questions remain regarding how that money can be spent. Clark County will receive $26 million from the federal government, while its largest city, Vancouver, will receive $5.5 million. Neighboring Cowlitz County will get $6 million, and the town of Longview expects $1.14 million. But this federal funding will be a drop in the bucket compared to what is needed, and the municipalities worry that they will not be able to use it to address some of the most pressing local needs. Vancouver is expecting a drop in revenue amounting to $45 million, primarily due to the sudden slowdown in construction activity and declining sales tax revenue. Clark County expects its revenues to drop by $13 million, while Longview is planning to lose $4 million. As the cities and counties wait for additional guidance from the federal government, they are forced to make tough decisions in the short term. At least 300 city workers in Vancouver found out last week that they will be subject to temporary pay cuts. Much of the federal aid is likely to be directed toward contact tracing initiatives, which public health experts argue is necessary for the reopening of local businesses and services. OPB – Struggling SW Washington Counties to Get Millions in Federal Aid for Coronavirus Costs
The State of Oregon has approved a land sale in Bend that will allow a large mixed-use project to continue moving forward. Late last month, the State agreed to sell a 382-acre parcel located within Bend’s urban growth boundary to California-based developer Lands Bend Corp. The plot is located at the intersection of Stevens Road and 27th Street on the eastern edge of the city of Bend. The $22 million sale was approved by Oregon’s Land Board late last year and is scheduled to close later this year, pending a due diligence period. The developer will conduct a master plan process to include input from the Bend community on the details. Still, the preliminary plan is for a, quote, “complete community with a mix of housing and employment types.” The state expects the development to generate $450 million in economic activity and over 800 jobs by 2028. DJC – Bend Development Plans Advance with Land Sale
Finally, CityLab reports that some tenant advocates are expanding their calls for canceling rent into more significant ideas for more sweeping systemic changes. With sharply increasing unemployment and limited federal funding for rent subsidies, the idea of canceling rent has been brought into the mainstream, despite warnings from economists that it could have broader negative impacts on the economy. A new grassroots coalition, United for a New Economy, recently launched a platform called Our Homes, Our Health, which is advocating for lawmakers at all levels to suspend rent and mortgage payments for the duration of the emergency. The group has gained the support of progressive politicians, including Representatives Alexandria Ocasio-Cortez and Ilhan Omar. Chris Schildt, the senior associate for national research group PolicyLink, argues that it will not be enough to temporarily cancel rent and then go back to business as usual. In his words, the pre-pandemic “status quo was a perennial crisis.” To this end, the Our Homes, Our Health policy platform includes ideas for turning privately owned rentals into public housing. One part of the plan advocates for cities to use eminent domain to purchase AirBnBs and luxury housing. Also, the plan’s “Buy-Outs Not Bailouts” policy encourages public housing agencies to buy rental units from smaller landlords who are struggling with reduced income. Advocates believe these measures would prevent the corporate buyouts that were ubiquitous after the last recession. While these plans may have sounded like fantasies a few months ago, as more and more renter households find themselves in precarious situations, municipalities may become more open to drastic actions. CityLab – “Cancel the Rent” Could Be Just the Beginning
Thursday, May 7, 2020
HFO-TV: What the Eviction Moratorium in Washington and Oregon Means for Landlords
In this two-part interview, Ball Janik Partners Chris Walters and Ciaran Connelly discuss the eviction moratoriums and what it means for landlords.
Part 2 covers landlord legal challenges and strategies.
Part 2 covers landlord legal challenges and strategies.
Wednesday, May 6, 2020
A Notable Recent Sale in Vancouver!
This was not HFO’s largest transaction but might be one of the first HFO closed during a pandemic. Madison Square Apartments is a 32-unit complex constructed in 2005. For additional information on this transaction, contact us at (503) 241-5541.
City of Seattle Adds Inability-to-Pay Defense to Evictions to December 4
Tuesday, May 5, 2020
Our May, 2020 Update on Multifamily Lending from AMF Capital
Tim Steele, a Director at AMF Capital, provides a May, 2020 update on multifamily lending.
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