Downtown Apartment Buildings To Open Soon:
Steep Price Of Upscale Units Raises Questions Of Affordability

Cindy Peng, Daily Californian, 8/5/2004

At a time when Berkeley faces a soft rental market, developer Patrick Kennedy will open the doors this month to three new Downtown apartment buildings to house tenants in nearly 200 upscale units.

Two years ago city officials lauded the developments as the solution to BerkeleyÕs housing shortage, but as opening day inches closer, they now voice doubts about the future success of the premium-priced apartments.

Demand for housing has been soft during the past two years, according to the Berkeley Rent Stabilization Board, prompting a spate of "For Rent" signs in apartments around the city.

As of March 2004, the median price of an apartment in Berkeley was $917 a month for a one-bedroom and $1,200 a month for a two-bedroom, according to an April report by Jay Kelekian, rent board director.

A tenant at the new 100-unit Fine Arts Building, which is exempt from rent control laws, can expect to pay a monthly rent of $1,495 for a one-bedroom apartment or up to $1,850 for a two-bedroom - prices that many agree are likely to affect the rental market.

"I think what youÕre going to see is a high vacancy rate at these places, because no one can afford to live in them," said Jesse Arreguin, CAL housing commission director and Berkeley Rent Board candidate.

He said rising student tuition fees and a bad economy may contribute to studentsÕ reluctance to rent the new properties.

But low-income tenants have reason to rejoice, said Stephen Barton, director of the Berkeley Housing Authority.

Nearly 40 apartment units in the new buildings will be rented at low-income rates, in accordance to an agreement between the city and the developers.

Kennedy did not return requests for comment.

The new developments are the Bachenheimer building at 2119 University Ave., the Fine Arts Building at 2110 Haste St., and the Touriel Building at 2004 University Ave.