Evanston City Council members backed away from authorizing a temporary moratorium on the deconversion of condominiums to rental apartment buildings, after aldermen sparred on the length of time of the moratorium and then failed to move forward altogether.
At the Jan.13 City Council Planning & Development (P&D) Committee meeting, and then later at the Council, aldermen discussed a resolution to establish a moratorium on condominium deconversions.
The move would allow “additional research of the current deconversion activity, local ordinances and potential impact or changes that could take place to available housing in Evanston if deconversions continue as permitted by current law,” staff said in a memo.
Alderman Ann Rainey, 8th Ward, originally proposed the move after some owners of condominium units at 2730-2760 Hampton Parkway in northwest Evanston appeared at the Nov. 25 P&D Committee meeting urging aldermen to place controls on the issue.
The changes they sought included passing an ordinance similar to Chicago’s, setting 85% as the percentage of unit owners needed to vote in favor of a developer converting a building from condo to rental.
At that meeting, one longtime owner, fighting displacement, described a developer’s push to buy the building for conversion as a “hostile takeover.”
In making the motion for a moratorium, Ald. Rainey, senior member of the Council, recalled the moratorium the City declared in the midst of the condo conversion craze of the late 1970s and early 1980s, when many rental buildings in the City were being converted to condominiums.
At that time, “Evanston took a leadership role and was in the forefront of placing controls on how a building could be converted,” she said.
At the Jan. 13 P&D meeting, staff had suggested the Council establish a referendum for six months, placing July as the expiration date.
During public comment, though, David Fisher, a resident of a building at 200 South Boulevard, urged aldermen to hold off on the moratorium, saying those in his building are currently exploring the deconversion issue.
“Putting a moratorium over condominium conversions for the entire City seems like trying to take care of a fly on the wall with a sledgehammer,” he said.
“For example, we are a very small, eight-unit condo and, because of the market for conversions, we actually have an opportunity to get out from under water,” he said, referring to a situation when the balance of a mortgage loan is higher than the property’s fair market value.
“In fact, most of the owners in our building have not been able to sell since 2008,” he said.
In the deconversion process, though, “working as a group, we are all on board with this, and would love to move forward. I’m actually on the board,” he said, “and we’ve been working on this for months. And we just found out about this [the moratorium and] that all our work could be put on hold.”
Ald. Rainey asked staff to take a look at three months for the deconversion moratorium, citing the stories some of the Hampton Parkway residents shared.
Alderman Donald Wilson, 4th Ward, said he agreed that the City needed to take steps to make it harder to deconvert, including ensuring “that a higher percentage of residents really wants this to happen.”
At the same time, he said, “I really don’t think we should be doing a moratorium,” he said.
As its basic premise, “this [deconversion] is a real estate transaction,” he said. “So the idea that we’re going to just decide that a certain real estate transaction can’t go forward, I’m really troubled by that. I think it sets an extremely dangerous precedent.
“Where does the line get drawn on that?” he asked, adding: “It’s [deconversion] not a question of zoning approval. We don’t have a role in this process. We’re not granting plan developments.”
On the Council floor, Ald. Rainey acknowledged that there are some buildings, such as the one on South Boulevard, that “are trying to lure real estate developers because they’re under water.
“I get that,” she said, “and this three-month moratorium is not going to hurt them. They can get developers to come in and buy their buildings for a price that is worth more than they would get if they put them on the market by themselves.
“But we’re talking about people who are in buildings like on Asbury and other places where [because of deconversion] people are terrified that they’re going to lose their homes for less than what they’re worth,” she said.
“So I’m just saying, ‘Let’s take a look and see what we can do to make things better in those three months.’”
The resolution for the moratorium failed though, by 5-3 vote. Voting in favor of the moratorium were Aldermen Robin Rue Simmons, 5th Ward; Eleanor Revelle, 7th Ward; and Ald. Rainey.
Voting against were Aldermen Peter Braithwaite, 2nd Ward; Melissa Wynne, 3rd, Ward, Ald. Wilson; Thomas Suffredin, 6th Ward; and Cicely Fleming, 9th Ward.