Slum-like Paso Robles apartments getting ‘full overhaul’ after lawsuit, sale
The former Grand View Apartments complex in Paso Robles — which closed earlier this year following a lawsuit against the previous landlords for slum-like conditions — has been sold to new owners with big renovation plans.
The Koto Group, a property management and investment firm, partnered with Doug Wetton Properties in Orange County to renovate and reopen the apartment complex under the name Vista Robles, according to James Knapp, the company’s president.
The Koto Group has student housing properties in San Luis Obispo but is based in Santa Barbara.
“Our niche is finding properties that are older, and typically need work,” Knapp said. “And I think our goal is to provide a really nice resident experience with existing buildings that provide a middle-of-the road price point.”
Construction on the project began June 15 and is anticipated to cost around $11 million, including property costs, according to Knapp.
“It’s really going to be a full overhaul,” Knapp said.
Knapp said the company is working with the city to make sure the complex’s new look fits the community.
According to a release, the 54 reconstructed units will have private patios, granite countertops, washers and dryers in each unit and new electrical and plumbing.
Conditions at apartment complex lead to lawsuit, evictions
Residents of the former Grand View Apartments filed a class action lawsuit against Ebrahim and Fahimeh Madadi, their Santa Barbara County landlords on May 7, 2019. The Madadi couple was accused of renting unsafe apartments filled with mold, infested with vermin and plagued by plumbing problems.
San Luis Obispo County Superior Court Judge Ginger Garrett approved an injunction prohibiting the Madadis from collecting rent due to substandard living conditions at the apartments.
The landlords then decided to go out of business rather than make $2.5 million in needed repairs and tenants were evicted.
Grand View renters were to receive $1,000 for relocation expenses and returned their full security deposits, according to the court ruling.
The last tenants turned in their keys on Feb. 28, according to the San Luis Obispo Legal Assistance Foundation, which represented the tenants in the lawsuit.
Many former Grand View renters struggled to find new housing due to time constraints and the complex’s notoriety, especially a bedbug infestation that plagued most residents.
“All of the tenants we have spoken with are in much better housing now,” Stephanie Barclay, legal director for SLOLAF, said in a news release.
People’s Self-Help Housing, the Paso Robles Housing Authority, the Housing Authority of San Luis Obispo, the county Department of Social Services and the Paso Robles Joint Unified School District helped tenants find resources to relocate.
While some tenants were able to find affordable housing in the area, others had to leave the county. According to the release, most tenants relocated near northern San Luis Obispo county.
In February, the property was put on the market for around $8.9 million, although county records show the property’s tax value was assessed at around $6.1 million in 2019.
The property sold in early June for around $7.7 million — about $1.6 million above the county’s assessment value and $1.2 million less than the marketed price, according to Redfin.com.
Even after the property was listed, the lawsuit continued.
“Our lawsuit against Grand View Apartments continues in the court,” Barclay said in a February news release. “We intend to pursue just compensation for the damages our clients have incurred and the injuries they have suffered.”
Need for cheaper housing in Paso Robles
Knapp said he felt there was a real need for affordable housing in the area after speaking with city officials and community members.
“We just saw this opportunity to not only take on this project that’s been a big blight in the community right at the entrance of downtown Paso (Robles), but also to provide what we hope is a needed housing class in Paso,” Knapp said.
In Paso Robles, the rental vacancy rate is 1.9%, according to U.S. Census Bureau data in 2019.
The new Vista Robles apartments are slated to begin opening in September, Knapp said. The apartment complex will begin leasing in mid-July and will likely have a phased opening, with the northern complexes finished first.
“This is very good news for the city of Paso Robles,” Paso Robles Mayor Steve Martin said. “It’ll be servicing the same market that the previous owners were servicing, but with a much superior product.”.
One-bedroom apartments will be available in the $1,500 to $1,575 range, two-bedroom apartments will range from $1,600 to $1,700 and three-bedroom apartments will be in the $1,850 to $1,900 range, according to a news release.
Former Grand View tenants had previously told The Tribune that a two-bedroom apartment in the complex cost around $1,600.
Knapps said calling the apartment price “middle-range” is subjective, but they based the cost off of market value.
“We’re really confident that we are going to turn it into a great product and really revitalize the site,” he said.
Affordable housing advocates ‘disappointed’ to lose property
Peoples’ Self-Help Housing, a Central Coast affordable housing nonprofit, attempted to buy the Grand View complex in 2019 after in an attempt to prevent residents from being displaced.
But the owners were seeking to make more money on the apartments and the deal never came to fruition, said John Fowler, Peoples’ Self-Help president. The owners once tried to sell the complex for $11.5 million, according to a previous Tribune story.
Fowler said Grand View’s ultimate sales price was very close to the offer his nonprofit made on the property last year.
“We’re disappointed we couldn’t affect a purchase and keep these people placed, because that was our goal,” he said.
Peoples’ Self-Help has previously worked with the Koto Group and has received donations from the company, Fowler said. He hopes to make contact with the company and see about a possible affordable housing collaboration.
In spite of the new complex’s mid-range pricing, the units still won’t be affordable for Paso Robles’ hospitality and agriculture workers, who are in desperate need of housing, Fowler said.
“Once you lose affordable housing in a community, it doesn’t come back,” he said.
This story was originally published June 19, 2020 at 11:41 AM.
