Tech wealth is coming to South Los Angeles — but not in the way some other neighborhoods in the city have become accustomed to.
A new program backed by the personal philanthropic company of Facebook founder Mark Zuckerberg and his wife, Priscilla Chan, aims to help small landlords there so that properties stay in the hands of locals, stay affordable to locals and help build wealth within the community.
The Los Angeles Local Rental Owners Collaborative, or LROC, is a joint effort of nonprofits, an online property management firm and the Chan Zuckerberg Initiative. It will put $5 million in the hands of landlords — particularly those slammed by the COVID-19 pandemic — to pay for rent owed by struggling tenants, and for any needed building repairs.
"It's a critical part of having a healthy neighborhood — having locally owned assets," said Alejandro Martinez, chief real estate officer for the Coalition for Responsible Community Development, which is administering the program.
The program, which launches Thursday, will also provide financial coaching for small landlords, including helping them pool resources to gain discounts on insurance, mortgages and legal services.
It's the latest deployment of tech money to alleviate a housing crisis that tech companies have been blamed for worsening through their rapid expansion over the last decade, as their offices expanded and highly paid employees moved to new neighborhoods.
Much of that money — including a $1-billion pledge by Google in 2019 — has gone toward building new housing.
The Chan Zuckerberg Initiative, which has invested in efforts such as housing, education and criminal justice reform, has in previous programs given money to enable nonprofits to acquire existing housing in California.
In this new initiative, funds will flow directly to private owners to enable them to keep their properties.
The idea is to directly help small landlords, particularly people of color, in order to stanch a potential tide of gentrification and lost wealth if the pandemic-induced economic downturn leads to a wave of foreclosures and forced sales similar to what happened in the 2008 housing bust.