Name: Veritas, big SF apartment manager, defends taking $3.6 million PPP loan
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Veritas, big SF apartment manager, defends taking $3.6 million PPP loan

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This is a carousel. Use Next and Previous buttons to navigateOne of San Francisco’s biggest landlords is defending its decision to take a $3.6 million Paycheck Protection Program loan, despite criticism that the money is supposed to help small businesses rather than a real estate company that controls more than $3 billion in assets.Veritas, which manages 265 San Francisco apartment buildings, claims the money will allow it to rehire 26 workers who were furloughed due to the coronavirus health crisis. The company had 196 employees prior to the health order. There are currently 170.“The PPP loan enables us to save the jobs of frontline employees and is critical to our business operations,” Veritas said in a statement. “These are the maintenance people, building managers and our resident services team who work hard every day to make sure our residents sheltering in place continue to receive the high quality living experience they deserve.”The loan, first by Mission Local, comes as tenants groups have repeatedly criticized Veritas for using strong-arm tactics to get longtime tenants with rent control to move out, including noisy, disruptive construction and “pass-through” charges, which allow landlords to jack up rent to cover improvements or maintenance.More for youLibby Staub, a tenant in a Veritas building, said that the news that her landlord had received such a large PPP loan made her “nauseous.” Staub owns a small sign-painting business and applied for a PPP loan on April 5, the day after the program was launched.“I just need a couple of thousand dollars to stay afloat and some of that money would go to Veritas to pay my rent,” she said “But I’ve got to wait in line, and they get $3.6 million to rehire 26 employees? It makes no sense.”To qualify for a PPP loan a company must prove that the money is “necessary to support the ongoing operations of the applicant,” according to the Small Business Administration, which oversees the program. Borrowers must take into account “their current business activity and their ability to access other sources of liquidity.”The Treasury Department and the Small Business Adminstration, which jointly manage the PPP loan program, said Wednesday in about the program that the SBA would review all loans of more than $2 million.Brad Hirn, an organizer with the Housing Rights Committee, said that Veritas has plenty of access to capital and should not be taking advantage of a program meant to help smaller businesses, many of which have lost all revenue because of the pandemic. He pointed to a San Francisco Apartment Association survey that found that 96.8% of San Francisco tenants paid rent in May.“The vast majority of tenants are paying rent — many of them are borrowing money or making other hard decisions in order to keep a roof over their head,” said Hirn. “For Veritas to say they have revenue problems or lack of access to capital is outrageous.”Ratings for the Bay Area and California, updated every 10 minutesA Veritas spokesman said the buildings it manages are all owned by separate investment groups and that rent collected goes to those investors. Veritas makes money by collecting fees for services like leasing units to new tenants or making improvements in the buildings. At a time when the rental market has come to a standstill and local shelter-in-place orders temporarily stopped construction, those management fees have plummeted.In its statement, Veritas said: “With our revenues deeply impacted and a lack of access to capital, we furloughed significant portions of our staff and implemented salary cuts across the board.”But Hirn said Veritas and its investment partners continue to buy and sell properties — in early April a limited liability corporation affiliated with Veritas purchased Vue de Lac Apartments, a 75-unit property near Lake Merritt in Oakland. In addition, Veritas is attempting to sell a portfolio of 76 buildings in San Francisco, about one-third of its portfolio.While Veritas does not plan to return its loan money, other companies, including Shake Shack and Ruth’s Chris Steakhouse, have returned PPP loans. Over 180 public companies have received over $670 million in PPP funds and Congress has authorized another $310 billion in funding for a second round.J.K. Dineen is a San Francisco Chronicle staff writer. Email: Twitter:Ratings for the Bay Area and California, updated every 10 minutes

This is a carousel. Use Next and Previous buttons to navigateOne of San Francisco’s biggest landlords is defending its decision to take a $3.6 million Paycheck Protection Program loan, despite criticism that the money is supposed to help small businesses rather than a real estate company that controls more than $3 billion in assets.Veritas, which manages 265 San Francisco apartment buildings, claims the money will allow it to rehire 26 workers who were furloughed due to the coronavirus health crisis. The company had 196 employees prior to the health order. There are currently 170.“The PPP...

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J.K. Dineen

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Veritas, big SF apartment manager, defends taking $3.6 million PPP loan

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