Government can’t force tenants for life

Mr. Pakdel is an engineer who is a partial owner of a small manufacturing company in Northeast Ohio and spent a large part of his retirement savings toward purchasing this property with a hope that he could live there. In 2009, he bought a tenancy in common (TIC) apartment in San Francisco and rented it out to a residential tenant. As part of the purchase, Pakdel signed an agreement with the other owners to follow necessary steps to convert the building’s six units into condominiums.

Pakdel and the other owners eventually pursued conversion plans in 2015—two years after the city passed a Lifetime Lease Requirement mandating that property owners who convert TIC apartments to condos offer lifetime leases to any tenants, including Pakdel’s. Pakdel wants to leave open the possibility of using the condo himself in the future and offered to buy the tenant out of the lease. The tenant did not agree to a reasonable amount and offered to buy the property several hundred thousand dollars below its market value.

PLF represents Pakdel in appealing a federal district court ruling striking down his claims that the Lifetime Lease Requirement violates the following constitutional protections:

• The Fifth Amendment Takings Clause because it takes away Pakdel’s right to occupy his home and gives it to the tenant—for life.
• The Fifth and Fourteenth Amendments because the requirement interferes with Pakdel’s fundamental right to privacy in his home.
• The Fourth Amendment because it unreasonably seizes Pakdel’s property.

Moreover, this type of land use restriction makes it more difficult and more expensive to own a home in San Francisco—which is already the most expensive real estate market in the country. San Francisco needs more homeowners, not fewer. And certainly not onerous legislation which drives up real estate prices for everyone.