Veritas’ Reckoning: The City’s Biggest Landlord Faces $1 Billion Debt
Veritas, the largest landlord in the city, has been revealed to be delinquent on a staggering $1 billion in debt, potentially leading to the sale of several of their properties.
We’ve written about this company several times. From creating ADUs that residents called “a living hell“, Taking out small business PPP loans (even though they are not a small business) and even trying to push out a legacy business. These are just some of the shitty things this company has done.
Image: SF Tenants Union
Countless times, Veritas has squished “the little guy” and thought only about their bottom line. Some of their residents even created a union at one point and went on a rent strike.
How the heck does something like this happen when you’re the city’s biggest landlord? Veritas purchased a bunch of their properties in 2013 with 10-year loans. So, that debt has to be paid off this year. With investors weary of putting money into real estate during the current real estate downturn combined with apartment vacancies and office buildings empty, Veritas will have a hard time finding the capital they need to fund the debt. According to The Chronicle, property owners are seeing vacancy rates up to 35% in some residential properties.
According to a spokesperson for Veritas, they said to The Chronicle “While we’ve all seen the stories about office usage going down in the wake of hybrid work, multifamily operators in San Francisco must contend with even more challenges, including increased city regulation, increased taxes, more pandemic impacts, and the rising cost of doing business here. Recent corporate layoffs and relocations have affected apartment demand too.”
Brad Hirn, an organizer with the Human Rights Committee, a tenant advocacy group, talked to The Chronicle about the issue. Hirn criticized Veritas for its double standard in refusing to negotiate with tenants who are unable to pay their rent while expecting steady increases in operating income from their buildings.
“The basic business plan requires a steady increases in operating income from these buildings. Here they are talking about the spiraling cost of debt but at the end of the day, when their tenants can’t pay their rent, through no fault of their own, Veritas refuses to negotiate. We have 25 Veritas members in eviction court for rent debt,” Hirn tells The Chronicle.
What’s expected next? Hard to say what will happen next. The future outcome remains uncertain as Veritas explores its options in response to the situation. I have no doubt that they will somehow worm their way out of the situation. While not wishing harm upon Veritas, there is a little hope for a humbling experience that prompts a reevaluation of their policies that contributed to this situation in the first place.
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