DEAL RETAINS CAP ON RENTS; LOW-INCOME UNITS PROTECTED 14 YEARS.

Byline: Sylvia L. Oliande Staff Writer

Fearing that the new owners of the Shadow Ridge apartment complex would dramatically hike rents, Simi Valley officials devised a plan that will reduce the number of affordable units in exchange for a cap on some of the rents.

The agreement reached Monday night limits future rent increases on 34 of the very-low-income units, but also would reduce the number of affordable units from 95 to 69.

Some city officials said the loss of 26 units of affordable housing was negligible since the rents on those units had already been raised up to market value over the last 10 years. More importantly, they said, the compromise helped increase the length of time the very low affordability units are protected - from four more years to 14 years.

``The problem with the low affordable units . . . they were already at market rent,'' said Mayor Bill Davis, a member of the city's Affordable Housing Committee. ``What's the point in trying to save them? I'd rather work on the very low and be able to cap those so they don't creep up to the same price as market rent.''

The agreement limits future rent increases to 3 percent, or 85 percent of the market units, whichever is lower on 34 unrestricted very low income units. The remaining 35 very low income units will be capped at 66 percent to 70 percent of the market value.

Units at market value rent for $995 for a two-bedroom, one-bath apartment, and $1,050 for a two-bedroom, two-bath apartment.

A very low, unrestricted unit will rent for $786 to $845 for two bedrooms and one bath, and $773 to $892 for two bedrooms with two baths.

Finally, for the very low, restricted units will rent for $598 to $696 for two bedrooms, one bath, and $623 to $703 for a two bedrooms, two baths.

Davis said that as the sale of Shadow Ridge to Sequoia Equities was going through, some residents in the market-value units were sent notices that their rent was going to increase as high as $160 per month.

In a citywide market that has a 0.6 percent vacancy rate - down from 1.7 percent in 1997 - the increases were especially difficult because tenants had few options in moving to another area in Simi Valley, officials said.

That size of an increase created a concern among city staff about what kind of increase the low and very low affordable units might see.

Sequoia Equities, in an effort to take advantage of a bond agreement the previous owners had set up with the city, agreed to consider lengthening the time in which those rents would be protected.

Sequoia officials did not return calls for comment Tuesday.

The owners have said that some of the rent increases were to cover a $700,000 face lift they plan to give the complex in the coming months, including replacing carpets and laundry facilities.

The 332-unit apartment complex on Tierra Rejada Road was developed in 1989. At the time, the original developer, Sanport Development, agreed to hold 69 units for very low income households and 26 units for lower income households in exchange for the issuance of $25 million in multifamily housing revenue bonds.

The bonds are due to expire in 2004. The amended agreement with Sequoia will extend that to 2014.