San Francisco real estate groups sue city over pandemic eviction law that they say goes ‘too far’

A collection of real estate industry and landlord groups have filed a lawsuit seeking to block a new city ordinance that prevents landlords from evicting tenants due to back rent or penalties accrued during the coronavirus health emergency.

The lawsuit – filed by the San Francisco Apartment Association, the San Francisco Association of Realtors, Coalition for Better Housing and Small Property Owners of San Francisco Institute – seeks to overturn the COVID-19 Tenant Protection Ordinance that Mayor London Breed signed into law June 26.

The housing industry is also seeking an order to immediately suspend the law, which permanently prohibits a residential landlord from pursuing an eviction for nonpayment of rent due to the pandemic.

The real estate industry groups said that the ordinance “violates constitutional and state law, conflicts with Governor Gavin Newsom’s Executive Order on preemption and evictions, and, as drafted, will ultimately lead to more evictions as tenants are falsely led to believe that they can just stop paying rent.”

San Francisco Apartment Association Executive Director Janan New said the group’s members have been proactive in working with tenants unable to pay their rent because of the pandemic, often reducing rent and working out payment plans.

“But this ordinance goes too far,” she said. “No housing provider wants to evict, but by taking eviction for nonpayment of rent off the table, this ordinance will make it impossible for mom-and-pop landlords to collect the unpaid rent that they rely on for their mortgage, property taxes, maintenance and utilities.”

Supervisor Dean Preston, who sponsored the legislation with other board members, called the lawsuit “disgraceful but not surprising.” He said that many individual landlords have been working with their tenants but that “these associations have their own agendas.”

“In the midst of a pandemic, when people need to come together, it is outrageous that these real estate profiteers would go to court to promote mass evictions,” Preston said.

The real estate industry groups said that property owners have also been severely damaged financially by the pandemic, losing rent on both residential and commercial spaces. While about 97% of San Francisco tenants have continued to pay some rent during the pandemic, more than half of commercial tenants stopped paying altogether after their businesses were shuttered.

Noni Richen, president of the Small Property Owners of San Francisco Institute, said the law would allow renters to live “rent free from March 2020 to potentially September and beyond — and property owners would have no legal recourse to recoup unpaid rent.”

“Small owners are particularly hard hit by renters who cannot pay. We need the courts to intervene,” she said.

J.K. Dineen is a San Francisco Chronicle staff writer. Email: Twitter: @sfjkdineen

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