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Pension Funds demand HIGHER RENTS from Bay Area Residents November 14, 2018 CASA Technical Committee

November 27, 2018

November 14, 2018 CASA Technical Committee – excerpt (includes video)

At the November 14, 2018 CASA Technical Committee, Developer Covarrubias. TMG Partners tells the  Committee that Government Pension Funds are driving the demand for high returns on real estate investments.  CASA is a committee of industry insiders that has crafted a plan to collect $4 BILLION DOLLARS annually in taxes and fee to fund affordable housing.  Developers stand to make billions… (more)

Learn about CASA – The Committee to House the Bay Area
https://mtc.ca.gov/our-work/plans-projects/casa-committee-house-bay-area
CASA brings together leaders from across the Bay Area to build an actionable political consensus around increasing housing production at all levels of affordability, preserving existing affordable housing, and protecting vulnerable populations from housing instability and displacement.

Comments from readers who have studied CASA are appreciated. Here is one:

There are two ways to try to make such investments attractive to investors:

  1. Lower the costs and risks.  Although this is something that rarely works in anything government-connected, particularly in California, there is one thing that is being pushed that, if, where, and when successful, could reduce both cost and risk – namely, shortcut the environmental clearance and other regulatory compliance process.  However, this is being done only for a small subset of residential real estate projects, namely stack-and-pack that can be labeled as transit-oriented development (I say, “can be labeled as,” because the test to see if it qualifies is to low).  If you want to build something that the majority of people actually want to rent/buy, such as single-family detached in the suburbs, don’t even bother trying to qualify.
  2. Directly subsidize the developers.  This is not being talked about directly, but, you see CASA’s proposal to raise a huge amount of funding every year through a long list of potential taxes (most of which, CASA is claiming, would not require any action by the voters and, in at least some cases, would not require action by elected officials – well, I guess we may see what the courts have to say on these).  Exactly what would be done with these funds if they are not intended to subsidize developers?  Even if the intention was for governments to own/operate some of these new units, there would be significant revenue to various private sector parties from consulting, design, construction, operation, financing, legal work, etc.

I’m still waiting for the entire picture of how this CASA proposal is supposed to work.

– Thomas A.  Rubin

 

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