Law & Morter: How Soft Retrofits Affect Rent Control

There have been several 3.0-7.1 earthquakes that have shook Los Angeles since last Summer, which has officials re-examining soft story retrofits in the area.

What are soft story retrofits? A soft story building is a multi-story structure built with a first floor that is much less rigid (soft) than the floors above, such as in an apartment with tuck-under parking. The skinny poles propping up parking at the ground level are not strong enough to withstand the shaking in significant seismic activity, resulting in the upper floors COLLAPSING on top of it. The 2015 Los Angeles Soft-Story Retrofit Program was designed to prevent this from occurring in the future.

With more than 13,500 soft story buildings in Los Angeles, it is law to retrofit apartment buildings to better withstand earthquakes. Since 2015, wood-frame apartment building owners had 7 years to fix the buildings. Concrete apartment building owners had 20 years.

This means for wood-frame apartment building owners, there are only 20 more months to retrofit your investment.  The California Court of Appeals has ruled that owners can be held liable for injury or death of residents if action hasn’t been taken to retrofit the building.

Actions you should have already taken:

• First 2 years: Submit proof of previous retrofit, or plans to retrofit or demolish

• First 3.5 years: Obtain permit to start construction or demolition

According to alphastructural.com, as of last year there were still 4,500 buildings that have yet to submit retrofitting plans. And according to the Los Angeles Times, there are still more than 8,000 buildings that need to be retrofitted.

Are you one of them?

Paying for the Retrofit

Retrofitting most soft-story apartment buildings costs $40,000 to $160,000, with most averaging around $80,000, according to a recent estimate in Culver City.

Here’s where it gets interesting: In cities with rent control, who should pay for the fixes has been the subject of some debate. The Los Angeles City Council determined that owners can pass half the retrofit costs to tenants through rent increases over a 10-year period, with a maximum increase of $38 per month.

San Francisco allows all retrofit costs to be passed onto renters, even those protected by rent control, over a 20-year period; the retrofit surcharge can be no more than 10% of the base rent. Low-income tenants can seek and receive hardship exemptions to rent surcharges related to the earthquake retrofit.

If you need assistance navigating your lease and what you can and cannot do you compensate for your retrofit costs, send me a message. I can help you navigate the laws and create your strategy plan: info@homerentalsla.com