Fate of Historic Building and Tenants Hangs in Balance

By Richard Brenneman
Thursday September 17, 2009 - 09:47:00 AM

While the struggle over one of Berkeley’s newest landmarks has focused in part on a moment of national shame, for those who live there, a more crucial question is the fate of their rent-controlled apartments. 

“Just as in San Francisco, developers in Berkeley have realized that demolition is the easiest way to get rid of tenants who live in rent-controlled apartments,” Louis Cuneo, who has lived at 2525 Telegraph Ave. for more than two decades, charges. 

But Ali Eslami, the managing member of the limited liability corporation which owns the building, calls his tenants “the heart and soul of the building,” and says he wants to ensure their ability to stay. 

The questions the tenants have relate to specifics, but Eslami will say only that he’ll do everything he can to help them find alternative housing while he rebuilds the structurally ailing edifice. What he says he can’t give is an absolute commitment to funding the difference between their current rents and those of their temporary quarters for the indefinite period that construction will take. 

One key decision may come Tuesday night, Sept. 22, when the Berkeley City Council takes up Eslami’s appeal of the Landmark Preservation Commission’s decision to single out the unique courtyard configuration which separates the small apartments on the second floor as a significant feature when they added the structure to the list of official city landmarks on June 4. 

Eslami wants the City Council to remove the mention, an action he says is necessary if he is to add two new stories to the rear of the building for new apartments which he said are essential to make the property financially viable. 


The landmark 

Berkeley’s Landmarks Preservation Commission designated the building a city landmark in part because for three years ending in 1941 it housed the studios of Chiura Obata, a noted painter who was forced to leave the city when he, along with thousands of other Americans of Japanese ancestry, was interned following the attack on Pearl Harbor. 

The LPC declared the Obata Studio building a landmark in June. 

The primary reason for the designation cited by commissioner Austene Hall, was to keep the Obatas’ “humble story alive,” as Daily Planet reporter Riya Bhattacharjee noted at the time. 

What the commission didn’t note nor the new owner discover until after his company had bought 2525 Telegraph was the reality that the new landmark suffered from critical structural flaws that would require lengthy and costly repairs. 


The nightmare 

Cuneo and partner Marcia Poole are fighting for the building itself, hoping that they can continue to live in the building they’ve called home for the last two decades. 

Their struggle pits them against Eslami and his Oakland-Berkeley Investment Group, LLC, the legal owner of the building. 

To handle his legal work in the controversy, Eslami has retained Rena Rickles, a formidable legal adversary in Berkeley land use cases, while the tenants had enlisted the support of Southside activists including City Councilmember Kriss Worthington and George Beier, his opponent in the 2006 election. 

Poole and Cuneo live in a small second floor apartment that can only be described as charming, with hardwood floors and one of the building’s unique features, a shared interior courtyard full of plants and gently illuminated on a weekday afternoon by sunlight filtered through a translucent ceiling—a feature that would be sacrificed if Eslami is to make the additions he wants. 

Their small, three-room apartment features Cuneo’s photography and paintings by Poole. 

The two residents are well known in the community, where Poole is active in TelegraphAve.org, where she maintains the community website. She’s also the organizer of the annual Berkeley World Music Festival held at People’s Park. 

In addition to his photography, Cuneo is a published poet who specializes in haiku and he is the founder of Mother’s Hen, a poetry organization, and he is the founder and coordinator of the Berkeley Poetry Festival. 

“Seyoum Kebede, our previous landlord, was a wonderful man,” said Poole. “We all loved him. He bought at the end of the ‘80s because his wife wanted to start a restaurant.” 

The couple created The Blue Nile, a popular Telegraph Avenue eatery, in one of the building’s two commercial spaces fronting on the thoroughfare.  

“He let us choose who would go in next door to our apartment because of the shared courtyard. He used to say, ‘I have to take care of my tenants.’”  

After Kebede took over, the rents went up slightly, “but we didn’t pay a lot of money,” Poole said. In return for the low rents, Poole and Cuneo took it upon themselves to paint their own unit, covering the costs themselves, “I also put in the doors,” Poole said. 


New owner 

When the LLC purchased the building, Poole and Cuneo said they were early supporters, in part because Eslami and his partners said they wanted to start an artists’ venue downstairs much like the Red Poppy Art House in San Francisco’s Mission district. 

Eslami said Wednesday that the art house project remains his goal for the first floor. 

“We were thrilled that there would finally be an adult venue on Telegraph with art and poetry,” Poole said. 

But when the company’s 2007 proposal to create the Muse Art House and Mint cafe in the ground floor space came to the Zoning AdjustmentS Board, the ZAB approved both uses but denied Eslami’s request to allow beer and wine service—a decision Eslami told the board would kill the project. 

For the tenants, the troubles started with hammering, nine straight months of it, Poole said. 

By the time they’d stopped, the long-time tenants were left with a gutted downstairs, filled with holes, and their floor held up by temporary shoring. Gaps between the floorboards had allowed both dust and noise to filter upstairs into one of the apartments, which is held aloft by a steel beam support until a new foundation can be laid. 

Extensive work will be needed, as a quick tour through the downstairs area revealed. Massive square holes have been punched through the concrete floor, and a pump installed to drain off water that seeps into the holes.  

Eslami says a wall in a building next door is improperly shored, and extensive work will be needed to keep his own wall from collapsing. The building’s so-called “balloon framing” is an antiquated technology no longer used and must be strengthened, another significant cost along with a new foundation. 

Eslami acknowledges that he conducted only a visual inspection before buying the building, though he says even a professional inspector would have missed the major structural defects. 


Rent control  

For the tenants, the key issue is money. Because the current residents moved in before 1999, when the state legislature abolished rent control, they remain covered by the old Berkeley rent control law—a protection Poole and Cuneo say they fear could be lost if they’re forced to relocate during the year or more Eslami says construction will take. 

Eslami acknowledges that the lives of his tenants center around the Telegraph Avenue area, and said he hopes they can be housed in the district. 

The odds of finding lower rents than they’re currently paying are long, and higher costs could be financially disastrous, Poole says, because “we’re all either on low or fixed incomes.” 

While George Beier, writing as president of the Willard Neighborhood Association (WNA), said that “Eslami previously agreed to pay for the relocation to and from the building and the difference in the rents for the year or so that they will be required to move out,” his previous assurances had vanished by the time of a later meeting. 

“When pressed on this point in a meeting of the WNA, he pulled back on this issue and said something to the effect of “we’ll agree to whatever the rent board asks us to do.’ This is completely different from two prior conversations with both me and Vincent Casalaina (prior president of the WNA) in which he explicitly stated he would pay for the move-in, move-out, and the difference in rents. Both Vincent and I took notes of the meetings and then sent the notes to Mr. Eslami for his approval. I then sent these notes on to the Mr. Eslami, the City Council, the tenants, and the WNA.  

“Until that WNA meeting, I was ‘on-board’ with Mr. Eslami. I accepted the fact that due to his underestimation of the renovation costs, the building would have to be larger than proposed (four stories instead of two stories). I was willing to not protest when he increased the unit sizes to 5 and 6 bedrooms and reduced the unit sizes for the existing tenants. But his backtracking on his commitment to the tenants both humiliated and infuriated me. We all had a deal, and I felt that Mr. Eslami is/was backing out of the deal.” 

For his own part, Eslami says he is willing to accept mediation by the city’s Rent Stabilization Board, and he has discussed the issue with Jay Kelekian, the board’s executive director.  

Under current Berkeley law, landlords are only obliged to cover the rent differential for a maximum of three months during repairs, city Housing Department staff member Andrew Wicker told the Housing Advisory Commission during their Sept. 3 meeting. 

“There is a consensus for a need to strenghten some of the provisions,” Wicker said, and commissioner Marcia Levenson is urging the board to extend the period. 

One possibility, Wicker said, would be a one-year period, with a flat payment if the construction takes longer. The law also requires landlords to pay tenants up to $200 for moving costs, with the amount doubling if storage is required. 

Changes to the ordinance “need to be hashed out with different stakeholders,” he said.  


Another concern 

Cuneo and Poole say they are worried that Eslami’s goal may be to effectively end rent control through the construction process.  

While Eslami has insisted that’s not his intent, tenants’ rights attorney Paul Hogarth of San Francisco said that tactic has been used by San Francisco property owners to end rent control at their buildings. 

Developer Citiapartments AKH, also known as Skyline Realty, “is notorious for doing that in San Francisco,” Hogarth said. 

“They’d buy up buildings and try to get their tenants to leave, and if that didn’t work, they’d turn the buildings into construction zones,” he said. 

Repeatedly sued by the San Francisco City Attorney’s office, the firm is now in a state of collapse, he said, in part because they overpaid for buildings at the height of the real estate boom and were ill-prepared for the ensuing collapse.  

Meanwhile, until the dust settles at 2525 Telegraph, the fate of both a venerable building and its tenants, themselves Avenue institutions, remains in doubt.