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Google Lawyer Turned Landlord Inflames City’s Tech Clash

July 16, 2014

Google Lawyer Turned Landlord Inflames San Francisco Tech Clash

A protester during the Google I/O Developers Conference on June 25, 2014 in San Francisco. Photographer: Stephen Lam/Getty Images

To an outsider, it might seem that Google Inc. (GOOGL:US) in-house lawyer Jack Halprin’s dispute with his tenants is about money.

But it’s more complicated than rents and return on investment. Halprin’s Google connection has intensified the anger many San Francisco residents already felt over the influx of flush tech newcomers like him. And things have gotten personal.

Two years ago Halprin, 45, paid $1.48 million for a 107-year-old Victorian in the city’s Mission District, an increasingly popular destination for the hip -- wealthy and not -- to live and congregate. Facebook Inc. (FB:US) Chief Executive Officer Mark Zuckerberg paid $10 million last year for a hillside home blocks away from from Halprin’s Guerrero Street building.

Related:

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Halprin’s next moves pushed him to the fore in the larger clash between tech’s moneyed workforce and longtime residents laying claim to the city’s Bohemian legacy. Halprin moved into one of the seven rental units he acquired and began a series of evictions to get rid of the other tenants, beginning with Susan Coss, 48. He said he needed her unit for his domestic partner, according to state court papers.

Such evictions, as well as those related to remodeling properties, increased 56 percent from the previous year to 654 for the 12 months ending in February, according to a city report.

Soaring Values

San Francisco’s rent control laws have kept rates low for longtime tenants amid soaring real estate values. That suggests why Halprin may have been motivated to get the people living in his building out and why they were determined to stay.

Coss, a marketing and public relations director for a nonprofit group that operates the farmers market at San Francisco’s Ferry Building, was paying a rent-controlled rate of $1,365 a month in a neighborhood where a comparable two-bedroom unit is going for three times that, according to offers on craigslist.org. Other tenants in Halprin’s building pay as little as $757.

The median sale price for homes in the neighborhood in May rose 11.9 percent from the previous year to $1.15 million, according to DataQuick.

Under state and local law, Halprin was within his rights, and while subsequent litigation might impair his plans, most of the uproar over the evictions has been about the fairness or even morality of ousting long-term working class and middle-income people. The dispute in the neighborhood, named after the landmark mission founded under the supervision of California pioneer Father Junipero Serra in 1776, has become an emblem of the struggle between Northern California’s techie haves and non-techie have-nots.

Economy Changing

“It’s not just people moving in to be cool,” said Claudia Tirado, a Halprin tenant and third-grade teacher who lives with a taxi driver from Brazil and their three-year-old son. “They are moving in and changing the economy of the place.”

At Google’s developers conference last month, she brandished a placard that urged the company to “Develop a Conscience” and to “Stop Jack Halprin.”

The Impact of Inequality on Prosperity

Halprin declined to comment on the tenant dispute, as did his lawyers, Edward Rodzewich and Jak Marquez. Google declined to comment on its role in the community. Rachel Whetstone, a Google spokeswoman, didn’t respond to an e-mail seeking comment on Halprin’s tenant dispute.

This culture clash by the bay has also embroiled Twitter Inc. (TWTR:US) over the tax break that kept the company in San Francisco and helped trigger development of a run-down stretch of Market Street. It has become a frequent topic of cafe conversation and local evening news broadcasts -- and the subject of satire.

‘War on Poor’

The San Francisco Mime Troupe entertained those in the Mission District’s Dolores Park on July 4 with a musical promoted on the theater group’s website: “Skyrocketing rents. Loss of diversity. Certain workers welcomed like saviors, while other workers are discarded like trash.”

Or, as the agitprop mime troupe calls it: “The War on the Poor.”

That Halprin works for Google helps support the rich-versus-poor story line of protesters. Luxury coaches ferrying workers to the company’s Silicon Valley headquarters have drawn the ire of those kept waiting for city buses at the same stops. Wearers of Google Glass computerized eye wear have been heckled, all against the backdrop of the world’s most popular search engine (GOOG:US) facing lawsuits (GOOG:US) over practices such as vacuuming up information in e-mails.

Google Demographic

The arrival of technology-company employees is also seen as accelerating the erosion of the Mission’s multi-ethnic identity. Mountain View, California-based Google acknowledged its own lack of diversity in a report in May, disclosing that 91 percent of its workers are white or Asian.

After ousting Coss in November 2012, Halprin notified the others in February that they would be evicted. In defense, the renters all claimed to be disabled, which gave them a delay under the law. While details about their disabilities aren’t public, Tirado said hers is related to knee surgery five years ago from which she hasn’t fully recovered. The tenants now have until Feb. 26 to get out.

On June 13, they sued Halprin, claiming “substandard conditions” including water leaks, mold, inadequate heating and construction noise from Coss’s old unit. They also claimed invasion of privacy from a camera Halprin allegedly installed outside a tenant’s door after the buildings’ renters held a rally protesting their eviction.

Halprin hasn’t yet responded in court to those allegations.

Coss sued Halprin last year, claiming the justification for her eviction fell apart after the lawyer split with his partner, who never moved into Coss’s vacated unit. The couple separated six days before Coss had to leave, according to her complaint and a state court filing. Halprin said he acted at the time “with honest intent,” according to a court filing. Coss settled the case in June for a confidential amount.

‘Incredible Disruption’

Coss now lives in Alameda on the other side of San Francisco Bay and commutes to work from there.

“I’m pleased and happy it’s over with, but nothing will make up for the incredible disruption and loss of my home,” she said.

Under state and local law, a typical relocation fee for the no-fault evictions Halprin is attempting starts at $5,200 a person.

Landlords in San Francisco can evict tenants if their intent is to get out of the rental business. They can’t raise rents for new tenants for five years, and some are barred from converting units to condominiums. They can sell “tenancies in common,” known as TICs, in which residents share ownership of a building.

Halprin got some political pressure from the Mission’s local representative to consider rescinding the February eviction notices. Evictions in the neighborhood have been “devastating,” San Francisco Supervisor Scott Weiner said in an interview. He said Halprin hasn’t respond to a letter sent in March.

“The chance of me persuading someone to withdraw is probably on the small side,” Weiner said.

To contact the reporters on this story: Karen Gullo in federal court in San Francisco at kgullo@bloomberg.net; Dan Levy in San Francisco at dlevy13@bloomberg.net

To contact the editors responsible for this story: Michael Hytha at mhytha@bloomberg.net; Kara Wetzel at kwetzel@bloomberg.net Peter Blumberg


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