By Helga Gendell
Part XIV of the Marina del Rey history series addresses tenants’ past complaints about apartment and boat slip rent increases.
Part XIII in last week’s Argonaut concluded with information about increasing Marina development and prices.
An April 29th, 1984 article titled “Tenants File Appeal in Marina Rent Case” by Los Angeles Times reporter James Rainey reported, “Marina del Rey tenants and boat owners are continuing their fight against what they call exorbitant rent increases by apartment and boat anchorage operators.
“The Marina Tenants and Pioneer Skippers associations have filed an appeal in their latest legal move to slow rent increases of apartments and boat slips. A hearing date was set in California’s Second Appellate Court,” stated the article.
“Apartments and boat slips on county property are governed by a master lease between the county and landlords. Members of both associations said the county’s rent control ordinance and provisions in the lease do not adequately control slip and apartment rents in the marina. They hope to prove landlords are making more than the ‘fair and reasonable’ return called for in the lease.”
The Times article continued, “The appeal stems from a 1981 class action suit filed by the tenants association against three landlords: Deauville Marina Development Co., Marina Admiralty Development Co., operator of Mariner’s Village, and Bar Harbor Development Co. The Pioneer Skippers Association later joined the suit as a plaintiff and Oakwood Garden Apartments was added as a defendant.
“The lawsuit charged that landlords broke the lease by profiting in excess of a ‘fair and reasonable return on (their) investment.’”
“The suit called for rents to be rolled back and overcharges to be refunded to tenants and boat owners,” stated the Times article.
“Los Angeles Superior Court Judge Jack Ryburn dismissed the suit in February, ruling that apartment dwellers and boat owners had no say in the lease agreement.
“But tenants said the only way to prove their point is to open financial records to show how much the landlords are making.
“‘We think when the information comes out that it will be clear that excess profits are being made, especially when you consider that it is publicly owned land,’ said Willie Hjorth of the Pioneer Skippers.
“‘We thought the only way to solve it was through a lawsuit,’ said Hjorth. ‘We just didn’t have the time to go in and yell at the (Small Craft) Harbor Commission every time the rates went up.’”
The Times article continued, “Representatives of the tenants and skippers associations said current price controls are not working. The county adopted a formula in 1981 to limit the rents on 6,000 marina boat slips. The formula includes a weighted average of rates at other Southern California harbors and the average annual consumer price increase.
“In the last three years the price of the average boat slip has increased from $3.95 per foot each month to $6.22 per foot, a 57 percent jump.
“Privately operated anchorages at Newport Beach charged an average of $8.29 per foot for a boat slip, the highest in Southern California. Municipal boat slips in Santa Barbara are the lowest, costing $3.66 per foot per month,” stated the Times article of figures at the time.
“‘It’s obviously inflationary to make the comparisons with other marinas,’ said Jack Woods, former president of the Pioneer Skippers Association. ‘The only way to settle it is to look at it and see if a fair and reasonable return is being made.’”
“Chris Klinger, chief of revenue properties for the county Department of Beaches and Harbors, denied that the county is allowing the boat owners to be overcharged.
“‘Some of the lessees voluntarily submit profit figures,’ Klinger said, ‘and they are far from gouging the tenants. Surveys indicate that the marina is in the 70th or 75th percentile for rents compared with other harbors in Southern California.’”
The Times article reported, “Robert Leslie, a spokesman for the Marina del Rey Lessees Association, said the controls have lowered boat slip prices too much.
“‘Appraisals completed last year and this year have shown that the prices should be set at the fair market rate and right now we aren’t even close to that,’ Leslie said.”
“Rent increases are subject to the county’s rent control ordinance and review by the Department of Beaches and Harbors. But only 30 percent of the 5,813 units in the marina are under rent control. And the county Board of Supervisors has ordered that the ordinance be phased out entirely by the end of 1985,” the article stated.
“Greg Richardson, who administers rent control in Marina del Rey, said uncontrolled apartments tend to be 1.4 times as expensive as those under rent control.”
The Times article continues, “Applied to a one-bedroom apartment on the water, that would mean an increase from $500 to $700 per month. An average two-bedroom apartment would have increased from $871 to $1,300.
“‘For eight years we have been following this thing and asking for relief,’ said John Rizzo of the tenants association. ‘The county has let the lessees make tens of millions of dollars in overcharges and the people just get ripped off. As far as we know, the county has never turned down a request by the lessees for a single rent increase.’”
“Eric Bourdon, assistant director of the Department of Beaches and Harbors, said he cannot recall the department denying a rent increase. The department checks rents through similar communities in Southern California, Bourdon said.
“A consultant will be hired this summer to determine whether the lease or pricing policies should be modified, Bourdon said.
The Times article stated, “Bruce Warner, a lawyer for the Oakwood Garden Apartments, said he thinks Judge Ryburn’s decision will stand. ‘We think that the prices that are being charged are fair and reasonable under the lease.’ There are other provisions of the lease that indicate that one of the goals is to maximize revenues for the county. And that is based on profits made by the lessees,’ Warner said.”