Title
Appeal of Abiyou Rose, Union Park Management, to a Rent Stabilization Determination at 1822 GRAND AVENUE, UNITS 1-4.
Purpose of Appeal
We have applied for increase the rents for our property located at 1822 Grand Ave. Currently, we are in the process of appealing the denial resulting from the initial staff determination. The denial was based on the belief that our financial documentation didn't sufficiently support the need for a rent increase, according to staff evaluations. It's worth noting that we recently acquired this property, and it's in need of significant improvements. Presently, the four tenants residing in the building pay around $500 in rent. We have plans to undertake substantial updates to enhance the living conditions for these residents. Moreover, when looking at the neighboring area, it's evident that most tenants are paying at least $1100 for a one-bedroom apartment. Our primary goal is to ensure that we can properly maintain and enhance the quality of the building for our residents. To achieve this, we strongly believe that a rent increase is necessary to cover the costs associated with the building's upkeep and improvements.
Date of Determination
July 11, 2023
Body
WHEREAS, in the matter of Abiyou Rose, Union Park Management, to a Rent Stabilization Determination at 1822 Grand Avenue, Units 1-4, the Legislative Hearing Officer has reviewed the appeal and considered the testimony of City staff and the appellant;
WHEREAS, the Legislative Hearing Officer recommends approval of rent increases, as follows:
1) An increase of 33.57% be allowed as soon as legal notice is provided to tenants. This increase would result in average rent for the 4 units from $454 to $607. This rent is still below 30% AMI and is considered deeply affordable. This change increases estimated annual rent collection from $21,800 to $28,318, or + $7,318, which is short of the $11,000 increase described in the third column of the table. Tenants shall be given the option to continue in their units, under this increased rent for a total of 6 months from the effective date of this increase.
2) Rents may increase to $1,150, provided 6 months’ notice is given to continuing tenants. Such notice may run concurrently with notice of the increase described in the previous paragraph. It is important to note that a monthly rent of $1,150 is still considered affordable at 60% AMI.
3) As a condition of the exception to the rent increase cap granted a report shall be provided by ownership to the Legislative Hearing Officer by January 1, 2025, of all capital improvements made or contracted in accordance with the plan provided above. This report shall contain specifics on those capital improvements and use the amortization schedule associated with the MNOI worksheet used by DSI.
Now, Therefore, Be It
RESOLVED, that the Saint Paul City Council hereby accepts and adopts the Legislative Hearing Officer's recommendation in this matter.