Category Archives: Tenant Newsletter

The Millennium Tower Is Sinking.

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I have been a landlord for over 40 years, but I have never owned an apartment house. Realtors have often tried selling them to me, but I have always said No. I have always believed that single family houses make the best rentals. Houses are the easiest rentals to manage. Plus, single family houses and condos are exempt from rent control by California state law, and that supersedes all local rent control laws. If you ever decide to become a landlord, my advice is that it is much better to own and rent several single family houses than one big apartment house. When I read about a landlord who is involved in some sort of horrible mess with his tenants or the government, that mess is almost always in a big building, not a single family house. Here is a dilly of a mess in a big building….

The Millennium Tower is the tallest and most luxurious residential building in San Francisco. The 58 story Millennium Tower opened for business in 2008. It is located in the financial district and is home to many high tech multimillionaires and San Francisco celebrities, including Joe Montana and Giants star Hunter Pence. It is understandable why people like that live here. The Millennium Tower has a long list of incredibly luxurious amenities. Predictably, if you want to live in the Millennium Tower, you need to have very deep pockets. These condos are very expensive. Some units have sold for $10 million. Hunter Pence paid $4 million for his condo. MillenniumTower

That Sinking Feeling. Unfortunately, the Millennium Tower is sinking. The tower was built on land that was, at one time, under San Francisco Bay, and bedrock is very far down. Beneath the Millennium Tower is almost 200 feet of mud and sand. Because of this, most of the high-rise buildings in this area have steel pilings under them that go down to bedrock. However, in order to save money on construction costs, the builders of the Millennium Tower did not drive pilings down to bedrock. Instead, they only drove pilings down 80 feet. As the result, the Millennium Tower is built on dense sand, not bedrock. That is why the building is sinking. Since its opening 8 years ago, the Millennium Tower has sunk 16 inches, and it is still sinking. To make matters worse, the building is not sinking evenly. The Millennium Tower is sinking faster on the north side than the south side. As a result, the building now leans 2 inches towards the north. The Millennium Tower is in no imminent danger of collapse, but if the sinking and tilting continue, the building may have to be torn down. Sounds unbelievable, doesn’t it?! What can be done? Well, engineers are trying to figure out a way to stop or at least slow down the rate of sinking and tilting, but it isn’t certain that anything can be done. One thing is certain. There will be a lot of lawsuits over this mess, and some lawsuits have already begun. Some of the condos in this building belong to San Francisco’s best lawyers, and needless to say, anyone can afford to live in the Millennium Tower can also afford to hire a lawyer, and a very good one too.

Prices. The sinking and tilting seem to have had little effect – thus far – on the prices of condos in the Millennium Tower. The real estate market in downtown San Francisco is so hot that buyers are willing to overlook ‘minor defects’ (as one realtor put it) such as the sinking and tilting. To give you an example, unit #502 in the Millennium Tower is currently for sale. It is the most expensive one-bedroom condo currently for sale in San Francisco. In 2012, it sold for $1.8 million. It is now priced at $3.8 million. It is a spacious unit, but still, that’s an awful lotta money for a 1 bedroom apartment! The HOA (Home Owner Association) fees are also pretty stiff here and can run several thousand dollars a month, depending on the size of your unit.

Rents. I can’t tell if the sinking and tilting has affected rents. There are quite a number of units in the Millennium Tower listed for rent on Craigslist, but prices seem to be all over the place. Some 1 bedroom units are listed at $5,000 a month while others are listed for $10,000 a month. Although these rents seem high, they are not out of line for luxury buildings in that part of San Francisco. On the other hand, most luxury apartment houses in San Francisco aren’t sinking or tilting.
 
P.S. – Does something about this story sounds familiar? Well, if you went to a Christian Sunday School when you were a kid, you are probably thinking about a line in the book of Matthew that says that a wise man builds his house on a rock but a fool builds his house on sand. Oh well. I guess the people who built the Millennium Tower didn’t go to Sunday School.

Most Organic Food Is A Waste Of Money.

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MONEY-SAVING TIPS FOR COLLEGE STUDENTS.

The only thing that I buy in the organic section of the supermarket are strawberries. Strawberries grow on the ground, they are sprayed with a lot of chemicals, their skin is thin and very porous, and we eat the skin. I will pay a little extra for organic strawberries, but most organic food is just a complete waste of money. Frankly, I can’t even figure out what the word ‘organic’ means when it comes to some foods. Like – what is organic seafood? I have never been able to figure that one out. For example, what is organic Pacific salmon. I’ve seen that on restaurant menus here in Berkeley, but what is it? All Pacific salmon comes out of the Pacific Ocean, whether it is wild caught or farm raised, and there is a lot of junk in the Pacific Ocean – including radioactive junk from Japan. It seems to me that the only difference between organic Pacific salmon and regular Pacific salmon is the price. Think carefully about buying organic food. Go online and find out which organic foods make sense, and which are just a waste of money. Most of them are. I know a lot of people in the chocolate business, and they all say that organic chocolate is a complete waste of money. I don’t know a single person in the chocolate business who buys organic chocolate for his own consumption.

SOME MYTHS ABOUT ORGANIC FOOD.

Myth: Organic food tastes better. I know people who swear that they can taste the difference between organic and non-organic foods, but blind taste tests conducted at many universities have consistently found that people cannot tell any difference in the taste or appearance of organic vs. non-organic foods. The fact that organic food costs more (and often a lot more) doesn’t mean it tastes or looks any different than conventionally produced food.

Myth: Organic food is healthier. Maybe organic food is healthier for you, but there is no evidence of that. For over 50 years, scientists have been looking for evidence that organic food is healthier than conventional food, but there is still no good evidence that people who eat organic food are healthier or live longer than people who don’t.
 
Myth: Organic farms pay and treat their workers better. Sadly, that is also not true. The USDA organic label tells you nothing about the wages or working conditions at an organic farm. Workers at organic farms are just as likely as other farm workers to be underpaid, harassed, exploited, and cheated by their employers. Michael Pollan says: “If organic consumers went to those places (organic farms), they would feel they are getting ripped off.”

Myth: Organic food is pesticide-free. This is the most widely-held myth about organic food. An apple can be sprayed with a variety of powerful pesticides and still be labeled organic as long as those pesticides were on the approved list from the U.S. Organic Standards. But organic pesticides can be just as harmful to your health and the environment as inorganic ones. ‘Organic’ does not mean ‘safe’ or ‘good for you.’ Plants produce lots of toxic chemicals. For example, potassium cyanide can be extracted from a number of organic sources, including apricot pits and apple seeds, but that doesn’t mean that organic cyanide is good for you or safe to eat.
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P.S. – The majority of my current tenants are chemistry graduate students. They tell me that potassium cyanide is definitely not good for you, regardless of whether it came from an organic or inorganic source.

Solano Stroll is September 11.

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Solano Stroll is the largest street festival in the East Bay. If you only go to one street festival this year, this is the one to go to! Solano Stroll runs for 2 miles down Solano Avenue through Berkeley and Albany. Over 250,000 people come to Solano Stroll every year. The booths are end to end and on both sides of the street. There will be over 500 booths, including 100 individual craft makers, 50 food vendors, and entertainers at nearly every street corner. Solano Stroll opens with a parade that starts at 10AM. Admission is free. Finding parking near the Solano Stroll is virtually impossible unless you arrive early, but there is a free shuttle bus from the North Berkeley BART station to the Stroll.  Plus, AC Transit runs special buses down Marin Avenue, one block over from Solano Avenue to downtown Berkeley. There is also free monitored valet bicycle parking at the Stroll. For more information, go to: Solano Stroll.

Free FICO Scores

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A FICO score is a number that represents an person’s creditworthiness. FICO scores range from 300 to 850. The higher the score, the more creditworthy you are considered to be. The median FICO score in the U.S. is 725. FICO scores are used by the vast majority of banks and credit card issuers to determine how much credit they are willing to give you and at what interest rate. Although many companies will tell you your FICO score for a fee, you don’t have to pay for it. You can get your FICO score for free in a number of ways. The easiest way to find out your FICO score is to examine your credit card statement. A number of credit card issuers, including American Express, Bank of America, and Citibank, print their customer’s FICO scores on their monthly statements. You may have to look hard to find it, but it’s there someplace on your statement. Other banks, such as Wells Fargo, don’t put FICO scores on their monthly statements but will tell their customers their FICO scores for free upon request. Discover card will tell anyone, not just their own cardholders, what their FICO score is for free by using Discover’s Credit Score Card website. If you have a student loan from Sallie Mae, they too will tell you your FICO score for free. This isn’t something that you need to pay for.

 
Free Credit Reports. You also do not have to pay to see or print out your credit report. You can get that for free as well. Read my article: Free Credit Report.

Convenience Fees

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Beware of Convenience Fees. A lot of colleges allow students to pay their bills with credit cards. Some students get excited when they see credit card logos on their college’s web site payment page – but beware! Many colleges tack on ‘convenience fees’ when you pay them with credit cards. For example, on the U.C. Berkeley payment page, it says that they will accept Master Card and Visa for the payment of room, board, and tuition; but they charge a 2.75% ‘convenience fee’ on all credit card payments. That’s a lot! Think about how much that will cost you in dollars and cents over the time you will be in college. Their ‘convenience fee’ is in addition to the interest that your credit card issuer will charge you. If you can pay your tuition some other way, you should probably do so.
 
What Is a ‘Convenience Fee’? U.C. Berkeley isn’t the only university that tacks on ‘convenience fees’ when students pay them with credit cards. This is now a common practice at colleges all over the U.S. But just what is a ‘convenience fee’? It has always seemed to me that the term ‘convenience fee’ is a misnomer. After all, a convenience fee isn’t really a fee you pay for your convenience. Most people would find it more convenient to not pay an added fee. What businesses call a convenience fee is really a credit card usage fee, even though few businesses are willing to admit that that is what it is. The term ‘convenience fee’ implies that the fee benefits the person paying the fee, but a convenience fee is always for the benefit of the business (or university) that receives the money. I think it would be more accurate to call a convenience fee an ‘inconvenience fee’.  Hmmmm. I wonder what my tenants would say if I said to them: “Well – I know your lease says that your rent is $1,800 a month, but it would be more convenient – for me – if you made out your monthly rent checks for $2,000.”

Tenants Will Get One Second of Free Rent in 2016. Is That Fair to Landlords?

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The year 2016 will be one second longer than most years. The U.S. Naval Observatory will add one ‘leap second’ to its atomic clock on December 31, 2016. All time zone clocks in the U.S. base their time on the atomic clock at the Naval Observatory. The reason for this is that the speed at which the Earth rotates on its axis varies slightly depending on climatic and geological conditions, and the Earth is slowing down. Every year, it takes the Earth a fraction of a second longer to go around the Sun than it did the previous year. As a result, a ‘leap second’ has to be added to the calendar every 500 to 700 days. That, in turn, means that if you rent your home, you will be getting one second of free rent this December! Now it seems to me that we landlords would be justified in raising our rents for the month of December this year since our tenants are going to get to live in their apartments for one second longer than they did last December. I haven’t heard of any landlords planning to do that, but it wouldn’t surprise me if some did. We landlords do not like to give away free rent, even its just one second every few years.

Building Cathedrals in Medieval France.

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People seemed to enjoy my article last month about the identical statues in the Egyptian Museum in Cairo. Here is another from my collection of badly written homework:

“They built huge cathedrals all over France during the Midevil Period. They couldn’t build them earlier because France was still in its Evil Period. They had to wait until France was Midevil before they could build these big churches. Now France is good, so now they can build all the churches they want.”

Later on, and from the same essay: “We took a tour of Notre Dame cathedral in Paris. Our tour guide was a French priest. He spoke English very well considering how short he was. I was surprised that he didn’t have a French accent because he was only 5 feet tall.”

Hmmm. A know a Catholic priest who teaches at the Graduate Theological Union here in Berkeley. I’ll check with him about this. I wonder what he knows about France’s ‘Midevil Period’.

Was The Civil War Fought Over States’ Rights or Slavery?

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Every year, at least one of my students asks me this question; however, there is no way to answer it because the question is illogical. The problem is that the question presumes that states’ rights and slavery were two separate issues, which they were not. Until the Constitution was amended at the end of the Civil War, slavery was a states’ right, and for the leaders of the Confederate government, it was the states’ right worth fighting over. Until the ratification of 13th Amendment, states could decide for themselves whether to allow or prohibit slavery. States could also regulate slavery as they pleased, and slave codes varied a lot from state to state. For example, New York allowed slavery for over 200 years but abolished it in 1828. In Maryland, my home state, there were both free blacks and slaves. Strangely, it was legal in Maryland for free blacks to own black slaves, and some did. When I was a kid growing up in Baltimore, I knew people who lived in houses that had slave quarters on the premises. The slave quarters were usually small buildings behind the main house that the current homeowners were, more often than not, using for storage. In Alabama, on the other hand, there were no free blacks. All black people in Alabama were slaves. If a slave in Alabama was given his freedom by his owner, he had to leave the state within 30 days. If he didn’t leave within that time, he would be arrested and sold back into slavery at public auction. This was called remancipation. So it is pointless to debate whether the Civil War was fought over states’ rights or slavery. They were not separate issues. Nevertheless, I hear white Southern politicians arguing about this question on TV all the time. It seems that for most Southern politicians, there is no question as to what the Civil War was all about. They all seem to think that it was all about states’ rights and that slavery had nothing to do with it. Why do so many Southerners believe that? I think it is because white Southerners would like to believe that their ancestors fought and died for a good cause, something more noble than simply the perpetuation of slavery.

Free Bicycle Helmets!

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I was looking at my tenant’s bicycle helmets in the bike shed that we share, and I was shocked at what I saw. Several helmets looked really beat up. Even worse, 2 of them were missing parts designed to hold the helmet onto your head. If you would like a free brand-new bicycle helmet, I will pay for it! This is – as they say – a limited time offer. If you buy a new bicycle helmet between now and September 1, bring me the receipt, and I will reimburse you up to $75 in cash. That should be enough to buy a good bike helmet. If you don’t need a new bicycle helmet, I will pay up to $75 for the purchase of bicycle safety equipment instead, including lights, reflectors, locks, pumps, repair kits, and pressure gauges.

P.S. – You don’t have to point out that this offer is pure paternalism on my part. I am aware of that. I am sorry if anyone is offended by this offer, but on the other hand, I don’t know of any other landlord in town who is giving away free bicycle helmets.