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Firm Takes Heat Over East Palo Alto Crime

Publication Date: 
December 10, 2009
Source: 
The Wall Street Journal
Author: 
Bobby White

The Stanford Community Law Clinic is mentioned in this article about Page Mill Properties role in East Palo Alto real estate and crime:

A wave of robberies and burglaries is hitting East Palo Alto, threatening to reverse the city's recent period of stabilization. One reason behind the crime surge is the financial troubles of real-estate firm Page Mill, say locals, law enforcement and other officials of the town.

Page Mill Properties LLC, which began snapping up local apartments in 2006, became the city's biggest rental-unit landlord and attempted to transform the town by redeveloping properties into higher-end condominiums.

But in September, Page Mill defaulted on a $240 million loan from Wells Fargo & Co.'s Wachovia Bank and closed its East Palo Alto offices, leaving its properties there largely untended. Since then, some residents say they have seen more vandalism and loitering around their buildings.

...

Still, some residents complained about the company's steep rent increases, says the Stanford Community Law Clinic, a legal aid clinic that sued Page Mill on behalf of tenants.

As a result, city legislators in December 2007 placed a six-month moratorium on rent increases of more than 3%. After Page Mill challenged the moratorium in court and won, the city attempted to permanently stop the increases by drafting a ballot measure. Page Mill sued again and stopped the city from putting the measure before voters. East Palo Alto Mayor Ruben Abrica said: "Page Mill tried to wear us down. They filed so many lawsuits and took a completely adversarial stance." Mr. Wald, the receiver, is negotiating with lawyers from the city and Page Mill to try to settle the claims.