In response to the devastating wildfires that struck Los Angeles earlier this month and left tens of thousands of people without homes, a group of over 15 prominent multifamily development firms and other commercial real estate industry groups have banded together in attempt to support residents and rebuild Los Angeles.
The group, going by the name LA Wildfires CRE Pledge for Action, is a grassroots initiative focused on meeting the immediate needs of people in affected communities and creating a foundation for longer-term restoration, according to a release.
Although the list is growing by the day, founding firms include Benedict Canyon Equities, Camden, Christina Real Estate Investors, Cityview, Crede Group, Hanes Properties, LaTerra Development, Lincoln Property Company, Marcus & Millichap, Mata Construction, North Palisade Partners, Paragon Commercial Group, TruAmerica Multifamily and NAIOP SoCal, all of which are either based in Los Angeles or have substantial operations here, in partnership with the California Apartment Association.
“There’re simply not enough available apartments in Los Angeles to accommodate that, let alone empty rental houses, because the vacancy rate in most of the city for apartments is under 5%,” Bob Hart, founder and president of TruAmerica, said.
“It’s going to take all of us to rebuild,” Sean Burton, Cityview chief executive, added in a statement. “The scope of what’s happened is almost unimaginable. The rebuilding and recovery effort will be a massive undertaking, beyond even the Northridge earthquake … The scope is immense and it’s going to take an all-hands-on-deck approach from businesses, real estate, local, state and the federal government. We need a coordinated organization to channel everything into action to begin to get us back on track.”
Fighting price gouging
While rebuilding surely is the long-term goal, Hart expressed the short-term goal of the pledge group is making renting as accessible as possible for affected families, with a central focus on fighting price gouging by apartment owners.
Price gouging refers to the act of charging excessively high prices for goods or services, especially during a time of high demand or limited supply, such as after a natural disaster. But on Jan. 16., Gov. Gavin Newsom issued an executive order prohibiting rent increases of more than 10% in Los Angeles County through March 8, protecting tenants and making price gouging illegal.
“This call and pledge for action is a relevant, meaningful and actionable initiative focused on restoring the affected communities across Southern California,” Tom Bannon, chief executive of CAA, said in a statement. “It is encouraging that so many firms have already joined with us in this community restorative endeavor. We urge more firms across the commercial real estate industry to be a part of this vital cause as we contribute to Los Angeles’ resilience.”
While each company within the pledge group is offering varied services and waive fees, some of these include reducing or eliminating otherwise standard application procedures such as expediting applications, reducing security deposits and pet deposits, and maintaining consistent rent levels from pre-wildfire rates.
“We prompted all our asset managers and property managers to really be alert to people that are fire victims and to treat them with every ounce of compassion and immediacy of getting them situated,” Hart said. “It’s going to take a long time before the Palisades or Altadena look like the communities they used to be.”
Hart is in the process of moving nine families who have been affected by wildfire destruction so far into his properties in Pasadena, including the Hicks family, a family of three who tragically lost their home to the Eaton Fire in Altadena.
“I think everybody has maybe a slightly different twist, but the main part of the coalition is to unite and encourage other owners to follow the same values and ethos that we’re trying to demonstrate to prevent anti-gouging and to make it easier and accessible to rent as quickly as possible,” he said.
