Les questions, more answers

XPRESS: What is your response to SF State’s Tenants Rights group ‘condemnation’ for allegedly raising rents on employee housing and evicting residents who have retired?

WONG: We’re in a very complex issue now [with] what I would like to call legacy tenants that were in those spaces when we purchased that property in 2005. We have students we have employees and the buildings for example are in need of repair. We’ve been asked to provide better security. We’ve been asked to improve. We’ve made every effort to keep the rents below market rates for both students and employees and we hope to continue that. But it’s much like your bank account you want to do things and then you ask yourself what can I afford and what do I have to do and those often don’t agree nicely right? And so what we’ve tried to look at are different rent models that would allow us to do that, some of those repairs and security and etc and unfortunately it means that a different model about increased rent [must be used].

XPRESS: The Tenant Rights group claim that University housing was not effected or not influenced by local regulations, could you explain how that works?

WONG: In all of the rental agreements we are very explicitly clear that we are not subject to rent control. And they signed those leases so they are well aware of that. That’s where there is often some confusion of what is the University subject to in terms of city codes and state codes. But we are very clear that the housing is not subject to local rent control issues. But again the keypoint is that we are trying to keep rents down and into an area where we can actually make some improvements and you know try to remain below market.

XPRESS: Are those rents determined by the administration or the CSU?

WONG:: It’s local. And you know like any organization dealing with housing in San Francisco the inflation cost of living, my understanding is that we have tried to set up meeting with the individual. I think they’re scheduled now to talk about alternate rent models. So it’s not like slam dunking something here I know that Vice President Ann Sherman has scheduled some meetings with the faculty member and members of his group. I don’t think that has happened they have been trying to get together I think the first one is coming up soon.

XPRESS: Can you explain a little more about alternative rent models?

WONG: Well you know, we do our books just like you do yours. You know, what is our income? What is our cost? What is our projected cost that people want improvements, etc. and we try to figure out a model that sustains our obligations to bonds that were used to purchase those buildings years ago. Price points for folks and that’s how we come to rent at that point. And so it ranges, honoring our commitment to legacy tenants. We take a look at salaries of individuals. It’s a classic thing, instead of just saying ‘Okay, x percent across the board,’ why can’t we figure out a way that some might get two, some might get three, some might get four and yet all the rates still exist below market, but which one of those different models would allow us to make improvements that tenants have asked us to do. It gets pretty complex because of the whole legacy tenants that have been in their spaces for many years.

XPRESS: You mentioned you would want to be better friends with corporate San Francisco, what did you have in mind?

WONG:  A lot of our friends…we’re talking about internship programs…students have been pretty clear saying ‘We would like to do internships earlier in our academic careers’ and so the School of Business now, I believe, is opening up an internship opportunities for sophomores…We’ve gotten great responses from for example the Salesforces of the world Genetec,  I mean we’re sitting in a rich business culture. In South San Francisco… Oyster Point where Genetec sits, the growth in biotech businesses there is booming. There’s more IT in San Francisco than in Silicon Valley right now and so we need to build a bridge for the University students to move into these corporate sectors and I think we’re getting better.

XPRESS: Do you think that could compromise some of your goals in terms of development? Do you think there’s a conflict of interest?

WONG: You know, we’re not going to see corporate signs plastered everywhere, it’s just not going to happen. But if for example, if business ‘x’ calls and says ‘I hear you’re building a science building,’ San Francisco has no more laboratory space, none. ‘Les, what do you think about allowing us to add another floor if we could put a company laboratory.’ I might say okay but everybody you hire has got to be one of our students and every one of our students whom you hire [has got] to have a permanent job when they graduate. So the way in which you fashion those partnerships is a win-win I think… So we’re looking at doing that [in a way that’s] beneficial to academic programs and to students. We’d like a closer connection, we have a good connection to the symphony for example, SFJazz a lot of the art stuff, to the business community we’re going to get better at that. So that’s where you try to craft a win-win and not sell your soul to everyone that wants their sign on your building so you just work those out, they’re always unique one on ones with the company and industry.

President Wong smiles during the meeting with editors from Golden Gate Xpress at SF State on Monday, March 26, 2018. (Aya Yoshida/Golden Gate Xpress)

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  • the president repeated the same fallacy 3 times, namely that SF State housing is “below market”. SF State housing is NOT below market rate. If a low quality product is sold at lower price than a high quality product, this is not “below market”. SF State housing (according to administration) is (i) not rent controlled, (ii) eviction is triggered by employment termination or insufficient course enrollment, (iii) no adherence to SF minimum maintenance standards. The question is why SF State housing is discounted so little below other local housing, which does not have these deficiencies? Answer: SF administration is misleading tenants to believe it is “comparable” to other local housing, so it can charge higher price.
    Another fallacy is “In all of the rental agreements we are very explicitly clear that we are not subject to rent control”. license agreements from 2005-2008 have no mention to rent controls. starting with 2009, a vague statement was added to the license agreement. this was done without notifying the tenants. more disturbingly, newly hired faculty and staff were not informed that university housing is very different from any other housing in the area. faculty and staff made career and housing decisions, without proper disclosure.