Open Letter to Los Angeles Mayor Garcetti from AAOA Landlord

Dear Mayor Garcetti:

While you are considering various proposals to the economic tidal wave created by COVID-19, please take into consideration the following:

As a small housing provider and small retail property owner, I speak for a large constituency of small property owners who are continuing to perform all of our duties for our tenants under our lease agreements without rent payments. This includes continuing to pay or already having paid:

  • Property taxes;
  • Trash hauling fees imposed by the City;
  • Maintenance;
  • Repairs;
  • City Business Tax;
  • HCID fees;
  • Utility costs;
  • Management fees;
  • Property insurance;
  • and all other costs associated with property ownership.

We are not large developers, REITS, corporations or major players by any stretch of the imagination. Many of us derive all or a substantial portion of our income, including retirement income, from our few properties. If rent is not paid, we have nothing with which to pay for the above fees and costs, let alone the roofs over our own heads, food, utilities, mortgages, etc.

We are suffering every bit as much from the shut down as our tenants but continue to keep them safe and sheltered.

That is why we small property owners who nurture our landlord/tenant relationships and who want to retain our tenants long term are not sending Three Day Notices but are struggling along with our tenants.

I read today that the City Council is considering Rent Forgiveness or Rent Converted to Consumer Debt as relief measures for the mounting unpaid rent due to layoffs, jobs lost and business closures resulting from the orders issued by the Mayor and the Governor to curtail the spread of the virus.

Neither one of the proposed relief measures are going to work. Either one will only result in a second financial tidal wave.

If you required us to forgive all the rent that was due from our tenants, you have wiped out all of the income from the small property owners who depend on that rent for our own livelihoods-just as a small business owner derives his income from his customers.

We will be the ones out on the street for not being able to either maintain those apartment buildings and small retail properties nor pay our own household expenses-or both.

Turning the unpaid rent into consumer debt will equally threaten the small property owners who cannot take on such a burden in the face of our own expenses. We cannot carry debt like large corporations who have margins and leverage. And charging our tenants interest would be equally unfair.

We small property owners do not budget for risk or debt on such a major scale. We do not have the means to finance nor absorb all the unpaid rent that you are considering forgiving or having us finance. Nor can we afford the unanticipated interest that would be due, should we have to borrow to make up for our tenants’ unpaid rent.

Under the circumstances, no one should be evicted. And vacancies are not a welcome condition to any property owner, so the thought of evicting our tenants once the moratorium is lifted is not the option we would choose. Nevertheless, we are performing all our lease obligations during this time without being compensated.

Protections from potential bankruptcy and massive defaults, just like the ones you have put into place for our tenants is an absolute necessity for us, too. The Federal government is sending checks to many, but not nearly enough Americans to cover the necessities: food and shelter.

Los Angeles and the City of Los Angeles should recognize that the first priority of any economic relief should be payment for food and shelter. Landlords are providing that shelter both for apartment dwellers as well as small businesses. We should not be left with the short end of the stick but should be at the front of the line for relief after having held all the tenants safe and in place.

Please do not put the burden on small property owners. We are the ones who are keeping the small business in place and keeping residents in their apartments during this crisis.

We are doing our part. Do not punish us on the back end, but include us among all the small business, which is what we essentially are, when you develop financial relief from this financial and health crisis.


Linda Spiegel