City officials said they have reinstated a permit to demolish 1332 and 1334 N. Formosa Ave in Hollywood, one week after they said they were evaluating the legality of demolition that had already taken place.

Units at 1332 and 1334 N. Formosa Ave. were demolished to make way for new construction. (photo courtesy of Richard Koehler)

The property, owned by Belmond Homes LP and managed by Wiseman Residential, was partially demolished on Jan. 21, even though a notice from the city’s Department of Building and Safety (DBS) had been pinned to a fence around its perimeter ordering a stoppage of construction the day prior.

Tenants of 1332 and 1334 N. Formosa Ave. had been evicted through the Ellis Act last year. The act, passed in 1985, was meant to allow landlords to leave the rental business if their operations were losing money. But residents and city officials have said the law has been exploited by larger developers who want to replace affordable housing with luxury units.

The Ellis Act prohibits landlords from immediately re-renting units that have been vacated through the act.

The city’s Housing and Community Investment Department (HCID) sent an email last week to residents stating that it revoked the owners’ demolition clearance due to “a pending investigation of illegal use as a short term rental.” It continued, “the city is evaluating all options in response to the owners’ action to demolish the building.”

HCID said this week via email that it reinstated the demolition permit on Jan. 30. “HCIDLA has completed its investigation and determined that there was no impact” in terms of violations of the Ellis Act, the email read. Rushmore Cervantes, general manager of HCID, said the units complied with Ellis Act standards despite continued accusations from residents that their former units were being rented via Airbnb.

DBS confirmed that the order to stop construction and intent to revoke permits had been rescinded, but it is continuing to investigate the situation.

“This action was warranted due to the Housing and Community Investment Department’s reinstatement of their approval associated with these permits,” according to a DBS statement. “However, the Department of Building and Safety is investigating further enforcement options relative to violations incurred by the owners under these permits, the site’s current condition, and, our commitment to the public’s safety.”

Benjamin Cohanzad, a representative of Wiseman Residential, denied that the property was being used for short-term rentals after the tenants were evicted. He said last week that while long-term residents “do suffer” from Ellis Act evictions, the housing crisis in Los Angeles would worsen without more rental units, which his firm plans to provide in place of the demolished structure. He also said residents evicted from the property were each given $10,000 to $20,000 settlements.

Andre Dubois, 54, one of the residents evicted from the property, still alleges that his former rental unit on Formosa Avenue was being rented through Airbnb after his eviction.

“I thought for sure we had something against them,” he said. “I guess it wasn’t enough.”

Dubois said he received $10,300 from Wiseman Residential, and that he believes other former residents of the property were given the same amount. But after expenses including first and last months’ rent, and pet deposits for his pit bulls, the money “barely” covered the costs of moving into a new place.

Their Formosa Avenue apartment was also close to the oncologist office providing care for his girlfriend, who is battling breast cancer.

His girlfriend, Sonja Durham, is one of six plaintiffs named in a lawsuit filed on Jan. 3 in the Superior Court of Los Angeles by the nonprofit Eviction Defense Network against Wiseman, Belmond and Airbnb.

“How do you put a price on a human life?” Dubois said. “They obviously can and will continue to do so.”

Councilman David Ryu, 4th District, held a meeting last week with a few residents to discuss the demolition on Formosa, and the state of development in the city. Ryu had requested the stop work order to make sure the owners were adhering to rules and regulations.

Estevan Montemayor, a spokesman for Ryu, said the councilman wants to take a preemptive strike against future instances that would require HCID “to make a determination on a pending investigation before a clearance is issued for demolition.”

“Developers should not be able to reap the benefits of the Ellis Act until an open investigation is resolved,” Montemayor said. “Our office will be working with the city attorney and HCIDLA on how to better ensure the city’s tenant protections are strictly enforced by introducing legislation in the coming days.”