‘A huge sigh of relief’: Petaluma mobile home park residents celebrate after rent increase blocked
Residents of a Petaluma mobile home park voiced excitement and relief Tuesday after a third-party arbitrator blocked the park owner’s effort to raise rents by 40%.
The ruling comes nearly three months after a new ownership group for the Youngstown Senior Mobile Home Park informed residents of plans to hike rent of lots by nearly $300.
Owner Daniel Weisfield defended the proposed increase during a pair of January hearings, saying they were needed to cover rising property taxes and other expenses at the 102-unit McDowell Boulevard property.
But tenants mobilized to oppose the increase, one that many said would squeeze them out of housing entirely. They turned to Legal Aid of Sonoma County and California Rural Legal Assistance for help in their fight.
“Everyone is thrilled and very relieved to not have to worry about facing the possibility of being homeless or being uprooted to move in with family, if that was even an option,” said longtime resident Mary Ruppenthal. “A huge sigh of relief could be heard throughout our neighborhood and our community.”
The Tuesday ruling by Frances Fort, an arbitrator with California Hearing Officers, a private company, staves off a proposed $286.22 per month lot rent increase, but opened the door for a smaller, 3.2% adjustment based on the consumer price index.
Weisfield also planned to implement a temporary space rent increase of $15.45 per home per month for five years to cover the cost of the rent increase application, according to court documents. Fort denied that hike due to lack of supporting evidence.
Weisfield said he disagreed with Fort’s decisions, arguing the denial will affect his ability to adequately maintain the park.
“It does not allow us to earn a fair and reasonable return on our investment,” Weisfield said in an email Tuesday. “At this point we are assessing all of our options so that we can earn a fair and reasonable return and continue to operate Youngstown in the long-term as a 55+ manufactured housing community.”
But any plan to boost rents in Petaluma must align with the city’s decades-old rent stabilization program covering mobile home properties. Launched in 1993, local rules limit annual rent increases to the consumer price index or 6%, whichever is less.
Any attempt to exceed that amount can be challenged in arbitration, according to the program rules. The Youngstown case, according to a statement from Legal Aide of Sonoma County, is an example of the continued need for rent stabilization measures in the region, where housing prices continued skyrocketing during the pandemic.
“The attempted rent increase of roughly 300% of the local CPI, would have destabilized the housing of some of our most vulnerable low-income seniors,” Legal Aid said in an emailed statement. “This case once again demonstrates why rent stabilization measures are so crucial in this county and how tenuous housing stability is for so many seniors.”
Weisfield, a real estate investor who specializes in mobile home properties and co-founder of the firm Three Pillar Communities, bought the mobile home park along the east side of Highway 101 for $14 million in November 2020.
He put down $6 million and financed $8 million through a bank loan, according to court documents. As a result of the sale, the property was reassessed, boosting the annual tax bill to $145,000, roughly double the amount paid last year — $72,953, according to public records.
Deane Sargent, managing director for manufactured housing programs for PMC Financial Services and an expert witness called on behalf of park residents, told the arbitrator that the park still appeared poised to yield a sizable profit.
He presented a financial analysis that projected Weisfield would earn $528,851 in 2021, a steady increase from the 2019 reported profit of $453,986 for the previous owner.
“Mr. Sergeant’s analysis was the only evidence presented from either side showing what kind of return [Weisfield] is getting or could get given existing rents,” Fort said in the arbitration award document. “There was nothing from [Weisfield] that would establish by a preponderance of the evidence that it could not get a fair return short of the rent increase sought.”
Amelia Parreira is a staff writer for the Argus-Courier. She can be reached at email@example.com or 707-521-5208.