In the Fort Mason Center one recent night, real estate attorney Daniel Bornstein stood in front of a crowd of nearly 400 people.
“Can there be protected tenants in a property built after 1979?” he asked, pointing to the audience. “No!” they shouted in unison.
“If you get rid of an illegal in-law unit and the building becomes a single-family home, what can you do?” he said. “Owner move-in eviction,” the audience responded.
In a city known for rallies organized by everyone from Tibetan freedom activists to Folsom Street leather fetishists, this was an unusual demographic: landlords.
Lately, landlords, many of whom feel picked on, are coming together – not only to battle the stigma of renting out property but also to learn how to benefit from the tech-fueled real estate boom. Some have been watching neighborhood rents skyrocket while their buildings sit full of tenants from the early ’90s who pay less than half of market rate.
Among themselves, they’ve talked about the recent bad publicity aimed at landlords and Ellis Act evictions (“up 170 percent, I know, we’ve heard”) and how it’s getting them down (“It’s like we should be ashamed to be landlords” and “people act like we’re evil”).
Bornstein, one of the city’s fiercest and most prominent landlord-tenant rights attorneys, worked the stage during the recent gathering billed as a Rent Control Boot Camp wearing a sharp pinstriped suit and a dark goatee. “Only in San Francisco has being a landlord been so stigmatized,” he said.
Defending the Ellis Act
To the idea of people being outraged about Ellis Act evictions, he asked: “Is there any other profession that the government won’t let you leave? As American citizens!”
The law allows landlords to evict tenants when they remove their properties from the rental market. It is often used to remove tenants so the property can be sold.
Largely because of the tech boom, the city saw 68,000 new jobs last year but added only around 120 housing units. Rents have risen nearly 21 percent this year, while the government-approved increase for rent-controlled apartments was only 1.9 percent. A vacant multiunit building can sell for double the price of an occupied one.
Bornstein ran through the rules of rent control and gave examples of how he had dealt with “problems” – long-term rent-controlled tenants – to unlock cash flow. The energy rose to such a pitch that the 46-year-old became engaged in a call-and-response with the landlords.
Better option than eviction
In many ways, Bornstein’s advice was surprising: It’s far better to pay tenants to leave than to evict them. Part of his job is to help convince landlords that a one-time $50,000 payment to a tenant can be worth it, especially if the tenant is about to turn 60 (and become protected and very hard to evict).
“Every $1,000 more a month in rent is $100,000 equity appreciation in the property,” he said.
Bornstein told anecdotes about clever ways of getting buildings up to market rate. One time, he worked with a large home that had seven rooms rented out on seven separate leases. The first thing he did was persuade the tenants to go on one lease, thus changing the classification from multiunit to single-family.
“Then what do you do with seven people who moved into a single-family house in the ’90s? Raise the rent to market rate,” he said.
He argued that rent control doesn’t help the poor. “Rent control doesn’t protect the most vulnerable – it protects the longest occupying. It’s agnostic as to their wealth. It ossifies the divide between tenants and landlords when we should be providing a path to homeownership.”
When Bornstein asked if anyone had questions, dozens of landlords raised their hands. One man asks if he can raise the rent 100 percent to get the tenant out.
“What is aggressive versus what is egregious is a very good question,” Bornstein said, before recommending the landlord not do that.
A tall man in graying dreadlocks stood up and shouted: “You are one of the biggest problems of gentrification in this city.” He was escorted out, and the audience clapped encouragingly as Bornstein started talking again, a little fazed but still confident.
‘I’m a good person’
Bornstein offstage is soft-spoken. A women’s studies major from the University of Michigan and father of five sons, he quotes French sociologist Emile Durkheim to describe how eviction rules can make it hard to remove bad actors from a community. He talks about the way he’s treated by people who find his job distasteful – “I want to say, ‘Call my wife, call my mother, I’m a good person.’ “
At the end of the rally, he raffled off prizes – American Express gift cards, corporate branded hats. There were cookies and chips in back. Luisa Henson, who owns 1001-1009 Guerrero St., waited in line as landlords crammed around Bornstein with questions.
“He’s the best. He’s No. 1,” said Henson, who wore a gold headpiece and a long fur coat. “My tenants upstairs are being very disruptive … and he” – she pointed at Bornstein – “can fix anything.”
Bornstein’s clients include Wells Fargo and Mercy Housing. He specializes in the carefully executed buyout. Evictions don’t look good for anyone – they prevent condo conversion, and they’re “politically distasteful,” he said. Mercy Housing, a low-income housing complex where he has been the on-call lawyer for five years, has not evicted anyone for the past two.
Sister Lorna Walsh, the senior property manager at Mercy Housing, said sometimes a tenant has to leave, whether for violent behavior or for not paying rent.
“If my gentle persuasion does not work, Daniel provides the big stick,” she said. “An eviction is a failure, and he’s brilliant. He can stand up and pretend that we’re going to be throwing someone out on the street even though we know perfectly well we’re not going to do that.”
Sister Walsh said she feels people in San Francisco treat her rudely because she is managing a building.
“There is a stigma around being a landlord,” she said. “Sometimes it can be really, really difficult because people are automatically assuming that I’m a baddie.”
As the rally ended, the audience started heading out into the night. The artist Keshav Jiwnani, 44, stood outside. He’s been renting in the Mission for 15 years and came to the rally to learn about what was going on. “Even the landlords are real people with real problems,” he said.
But he was wary of what he had seen at the rally and in the city in general. “It’s a very real thing what’s happening here. I see all these buses coming into the city,” he said, referring to tech companies’ buses. “And I want to know where I stand. Am I next in line?”
Nellie Bowles is a San Francisco Chronicle staff writer. E-mail: firstname.lastname@example.org Twitter: @NellieBowles