2 Investigates: Court approves sale of Empyrean Towers to non-profit

A federal bankruptcy judge approved the sale of a notoriously troubled Oakland hotel to a non-profit group. The owner of the Empyrean Towers has since been stripped of control of the building and filed for bankruptcy.

The City Attorney's Office announced Tuesday that a bankruptcy judge had approved the potential sale of the property to the Berkeley-based affording housing non-profit group Resources for Community Development (RCD), paving the way for what tenants and their attorneys hope is reform at the hotel.

2 Investigates first exposed dangerous and unsanitary conditions at the Empyrean Towers more than a year ago. Uncover camera revealed fire damage, broken toilets, missing smoke detectors, and uncollected garbage among the problems on a long list of complaints reported by tenants.

On Tuesday KTVU cameras went back to the building that's undergone what appears to be a major facelift.  New paint, light fixtures, heating system and hot water heater has been added to the building. 

The property has come a long way since when KTVU went undercover back in January of 2015.  At that time residents showed us holes in the wall, bacteria in their water, a broken elevator and what appeared to be raw sewage dripping down the walls.

"They have suffered for years. In terrible conditions bedbugs ceiling leaks mold mildew rodents cockroaches.  They're survivors living through these conditions and just hoping for a better day," says the tenants attorney Anne Tamiko Omura, who told 2 Investigates she was "cautiously optimisitc" about the potential deal with RCD.

"I will feel better when everything has gone through. There are still a lot of hurdles we've got to meet," says Omura. 

Those hurdles include fixing that still broken elevator, plumbing and frequent power outages that residents say prevents them from cooking. 

"We got four different rooms on one circuit breaker. So if we try to use like a toaster oven. Then the power keeps going out," says tenant Johann Scott.

It's persistent problems like those that residents say should take priority over cosmetic fixes like new paint and furniture. In the meantime, tenants say they're living with uncertainty, waiting to see what happens when new management comes in.

"If you try to go up on the rent. Then fix the problems too as you're going," says Scott. 

In May 2015, tenants were forced out of the building by a serious health scare when investigators found coliform bacteria in the water in one of the pipes. Some residents told 2 Investigates by the time is was discovered they already drank the water and had gotten sick.

The City of Oakland filed suit against the owners of Empyrean Towers last year, accusing management of illegal evictions, failing to make repairs and for creating a public nuisance. Inspectors documented dozens of problems including broken windows, faulty plumbing, and an elevator that was frequently out of service.

After dodging 2 Investigates' cameras for months, KTVU finally caught up with owner Alice Tse in court last July. She agreed to a deal that would provide $500,000 for a long list of overdue repairs. But within the month, Tse had filed for bankruptcy and control of the property was handed over to a Chapter 11 trustee.

The trustee and Oakland's City Attorney requested the sale, which can take up to 18 months to complete.  After that it's estimated the property will need more than $10 million in renovations.

To make sure that happens the City Attorney says this case will be her top priority to ensure tenants have safe and affordable housing.

"We have the coordination of the court and all of its power. The trustee, we had a receiver appointed at the superior court level . We have my office pursuing this," says Oakland City Attorney Barbara Parker.

The RCD has until the end of the year to raise the funding needed to purchase the building.  Part of the court’s decision requires that the building is maintained as affordable housing for at least 55 years. 


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