In South Los Angeles, dozens of swap-meet vendors face an ominous threat to their livelihoods.
Swap meet vendor Rene Ramirez, and nearly 60 small retailers fear their jobs are endangered if landlord Eleos Ventures, a real estate development company engaged in purchasing properties to build affordable housing, ousts them from their facility.
“Management only shows up to open and close the swap meet. We, the vendors, are permanently running the place,” complained Ramirez, a clothing and home electronics vendor. “We clean, invest in the place, and even installed padlocks in units and restrooms.”
The swap meet, housed in and around the Fiesta Mini Mall warehouse on 4800 S. Main St. in South LA, has been home to vendors selling electronics, clothing, shoes and hygiene products for 12 years. But in 2021 the previous landlord sold the property for $3.5 million to Eleos Ventures, a developer that plans to build 221 affordable units on the site, a development they’re calling the “Elea Apartments.”
But vendors have rallied together, have managed to face down two 30-day eviction notices, and have initiated an ongoing five-month long rent strike. In July they brokered an extension with the help of Los Angeles City Councilmember Curren Price (9th District). Now they are asking Mayor Karren Bass to step in, and to negotiate an extension to let them stay after the Christmas shopping peak sales season, and support them in their quest to find an affordable site to relocate.
And they are waiting for Eleos Ventures to file an unlawful detainer (a formal legal procedure required for eviction in California) with the Los Angeles Superior Court to mount their legal defense.
Ilianna Morales, a spokesperson at the mayor’s office, said her team would look into the matter before the mayor issues a statement.
Mike Castillo, executive director of the business resources center located inside Price’s field office, said the third of three tenancy extensions would expire on Oct. 31, and emphasized that Eleos Ventures refused to issue a fourth extension.
According to Castillo, the landlords argued another extension would cripple their plans to build hundreds of affordable housing units on time.
The proposed development of new housing has been made possible by a recently passed law, AB 2011 (the Affordable Housing and High Road Jobs Act). Beginning in July of this year, the law, which was signed by Gov. Gavin Newsom last year, has allowed companies like Eleos Ventures to build housing on commercial zoned lots if developers commit to make all the apartments affordable, or 15% of them affordable with the rest a mix of retail, office and parking in lots with 20 acres or less of size.
AB 2011 also allows real estate developers to skip many of the city’s planning regulations and lengthy environmental reviews in the process by making such projects subject only to the streamlined “ministerial review” process.
According to Eleos’s website, all units at Elea Apartment will be affordable.
“We understand the gravity of the situation, and we are sympathetic with the vendors,” said Castillo. “These vendors are gritty, many have run their business for more than 25 years, and with a little more polishing, they can be successful.”
Adding that he believes that the vendors should network with city and small business incubators that provide workshops and information about grants and loans to grow their operations.
At an April meeting with Price, Castillo said the vendors walked out half way through the presentation after members of the councilmember’s staff tried to explain to them the lack of legal guarantees in their sublease contract.
Castillo said staff asked them to write their names on a list, describe their retail activities, services provided, and contact information to offer them assistance and process permits to work in street vending, now a legitimate activity as an alternative while they searched for another brick and mortar mall.
He underscored the vendors are so focused on remaining onsite that they dropped representation from an attorney with the nonprofit firm Bet Tzedek after a second meeting in May. The swap meet tenants switched to the Los Angeles Tenant Union for assistance.
The city does not have surplus properties to help relocate them in the Ninth District, said Castillo, who emphasized that before most vendors stopped paying rent this year, their leases were much lower compared to what other retailers pay at current market prices.
“There are free services that can help [them] with the transition. At the meeting, there were people upset, but there were some asking us how we can help them,” said Castillo. “I think they came confused [thinking] they had similar protections as residents do.”
Although Eleos is still in the process of obtaining development permits, several signs dotting the outdoor walls of Fiesta Mini Mall warn vendors, pedestrians and residents of an imminent demolition.
The imminent project already has the approval from the city’s Department of Building and Safety, and the signs display the application number.
“We want to stay to make the best of the Christmas sale season, and possibly one more year to find a location where we can afford to pay rent and customers can follow us,” said Ramirez as he prepared to close his shop on a recent Friday evening.
“These shops are owned by low-income people with low-income customers. We’ve seen other places where rent climbs to $1,000 or more a month.”
Fernando Espinoza, another retailer selling consumer electronics and cell phones, blamed the landlords for acting in bad faith after they bought the building in 2021.
“We believe they will raze this building to build housing for people with higher incomes,” said Espinoza. “We think the neighborhood may be in the process of being gentrified.”
He said Eleos management refused to meet them in person, and only did so after two 30-day eviction notices were filed in March and April.
“I feel as if the landlords are speculating with us, to see how far down we can go,” said Espinoza.
A commercial tenancy with many subleasers
As it stands, the current sublease began in 2012, when most vendors flocked to the swap meet building after they were evicted en masse from what is now an empty parking lot one block north.
Though the parking lot parcel now belongs to Eleos Ventures, it didn’t at the time and the company had nothing to do with that previous eviction.
Eleos Ventures was founded in 2020 by lawyer David Aghaei. He is a former planning commissioner with the city of West Hollywood and principal of Oak Road, another commercial real estate investment company. Daniel Dayan, a former analyst at Scopus Ventures, is a co-founder.
JNM Realty, a commercial real estate company hired by Eleos to act as property managers, issued the two eviction notices.
The first, dated March 13, 2023, was handed to some indoor tenants. The second, pinned to a wall steps away from the facility’s restrooms, was dated April 27. Both were signed by Joubin Manoochehri, also identified as an agent for the landlord.
Due to the unique features of commercial leasing, the first notice to vacate named Blanca Fierro Cortez as the main tenant, and nobody else. Initially, Fierro Cortez leased the facility and subleased the units to the vendors under the name El Centro Mini Mall.
All tenants paid monthly rents to her from $300 to $600 each through April 2023.
The second notice named Fierro Cortez, Fiesta Mini Mall, El Centro and “all others in possession,” of the premises occupied at four addresses on the same block stretching from 4800 to 4822 S. Main St.
Eleos did not return a phone call requesting comment, and has not responded to an email asking to provide a statement on the impasse.
Mariela Briseño, a vendor of a whole gamut of homecare and personal care products including hair shampoos, perfumes, dish soap, toilet paper, hand sanitizer and skin moisturizers, said all tenants agreed to a rent strike in protest of attempts to evict them.
On weekends Briseño expands her business’ footprint with removable tables and canopies to a reduced parking area to attend to more customers.
She said Fierro Cortez already used her $300 rent deposit to cover due rent.
At the in-person meeting they held with Aghaei and Dayan before Price brokered the latest extension, Briseño said vendors explained their perspectives and requested to stay a year and a half more to scout for and clinch a new rental place within the area.
At the meeting’s end, both Ramirez and Briseño said the landlords laughed at the notion to deal a more generous extension.
“We have to speak with Karen Bass. We can move but we have to find a place. Not because we managed to get another extension it means we have a place to go,” said Briseño. “Where are we going to go?”