Two tech communes that are part of The Negev properties are facing more legal problems.
The Negev Folsom and The Negev Sixth, both run by Danny Haber, 26, and Alon Gutman, 27, are under investigation by the Department of Building Inspection for habitability issues, violations of San Francisco's hotel-conversion ordinance, and room counts apparently exceeding the number designated in the certificates of use.
Previously, The Negev Folsom at 1040 Folsom St. was sued over wrongful evictions and The Negev Sixth at 219 Sixth St. was cited by the Department of Building Inspection.
An audit Nov. 21 revealed that Haber and Gutman failed to maintain and present daily logs on whether units were being used for residential or tourist purposes, or vacant, as required by the hotel-conversion ordinance. If they do not provide weekly reports and rent receipts by the reinspection Dec. 10, the department will bill them $500 per property due immediately.
The Negev Folsom, which was once the Park Hotel and housed low-income residents under rent control, has been advertised on Craigslist for $1,250 to $1,500 a month per bed with a shared communal space with couches and a kitchen, similar to The Negev Sixth.
While The Negev Sixth was cited Nov. 20 for outstanding habitability issues, a new notice of violation was generated Nov. 17 for The Negev Folsom, noting that there was no ventilation for the bathroom on the ground floor, lack of adequate ventilation for the water heater room on the second floor, no ventilation for the furnace room on the third floor, and missing permits for water heaters, furnaces, washers and dryers. It also said the gas stove needed to be replaced with an electrical stove, there were holes in the walls of a living area and bathroom, no viewers on the entry doors, lack of easily visible room-number designations and no caretaker for the building.
A $170 fee will be charged for every inspection after the reinspections of The Negev Folsom scheduled Dec. 17 and The Negev Sixth on Dec. 22 until the violations are abated.
Prior to The Negev Folsom, Haber and Gutman opened The Negev Sixth, with three floors of bunk bed-stocked single-room-occupancy units. And before that, they started The Negev Twelfth at 200 12th St., where the Planning Department investigated living-capacity complaints in a case that has since closed.
The Department of Building Inspection will also conduct room-by-room inspections of the Sixth and Folsom buildings Friday. City Housing Inspector Luis Barahona, who previously reported The Negev Sixth appeared to have more than 19 residential rooms allowed in its certificate for use, said he noticed the same issue at The Negev Folsom, permitted for 38 residential rooms and 10 tourist rooms.
"They're above the 48 [rooms] and we're trying to determine what the actual number is," Barahona said.
Room-conversion work done without permits "carries a nine times penalty," said Jamie Sanbonmatsu, acting senior housing inspector for the Department of Building Inspection. Such a penalty is applied when a notice of violation is issued for working without a permit and is assessed once the violator files a permit to comply and remedy the violation.
The habitability issues do not bother Cory Bray, 30, a Negev Folsom resident since August, when "it was a full-blown construction project." The sales director for a startup and former "president" of the commune said the citations are The City's "system working itself out" and "a lot of it sounds kind of nitpicky."
"I think if the worst things that happen is the room names are written in tape and the room floods the first time it rains hard, I think we're in pretty good shape," Bray said. "If you get past the dust and construction, that it's a work in progress, it's a fantastic community full of fantastic people."