Five months ago, Gail Jones gave up her job selling real estate to join a growing army of Northern Virginians in the war against the conversion of rental units to condominiums.
In her case, the battleground is the 50-unit Covent Gardens apartments at 1130 S. Washington St. in Falls Church. Covent Gardens, home to nearly 120 persons, would be the second complex to go condo in the city of 9,382.
"This is going to be an uphill battle," says Jones, president of the Covent Gardens Tenant Association. "We don't live in a fairy tale land anymore."
It is a skirmish closely watched by other tenant organizations and condo developers because, all seem to agree, it is a case that could resolve some muddled points of Virginia condominium laws.
Last month, the Falls Church Board of Zoning Appeals (BZA), against the advice of the city attorney, refused to grant GLM of Virginia Inc. the variances the BZA said were needed for conversion of Covent Gardens to condominiums. GLM has a contract to purchase the property from Merrick and Helen Marshall for $1.6 million.
GLM, which had previously won approval of the project from the city planning commission, has since filed suit against the BZA, claiming the variances were unnecessary but should have been granted automatically anyway.
At issue, according to City Attorney Paul Terrence O'Grady and lawyers from GLM and the Covent Gardens Tenant Association, is a state law that says condo conversions, if made without building changes, cannot be prohibited just because they are conversions.
But the law also says local governments may enact ordinance requiring developers to meet local zoning, land-use and site-plan requirements unless variances or special-use permits are granted. In seeking a variance, the developer must prove its denial would cause severe financial hardship almost equivalent to confiscation of the property.
when Covent Gardens was built in 1965, it did not meet some of the city requirements, although an occupancy permit was granted for unknown reasons. The complex is even further from compliance today because of changes in local ordinances, O'Grady said. No major alterations have been made to the project since 1965.
But now, GLM -- in its conversion plans -- wants Covent Gardens exempted from the minimum open-space requirements for parking lots. GLM also wants to reduce the number of parking spaces, build a higher fence and reduce the required percentage of landscaped area.
The BZA, whose approval would have been the final step before conversion took place, denied the variances after deciding GLM had not proved hardship because the complex still had value as a rental property. GLM decided to press its case in court.
"If this is litigated, I think it would be an excellent test case because the Virginia Supreme Court hasn't addressed this question. The law specifically says that localities can require tests, but it doesn't say that the variance tests can be changed so that the BZA has no authority," said Jim Almand, a state delegate and lawyer who, with Dennis Hottell, another lawyer, is representing the tenants.
City attorney O'Grady agrees that this may be a significant case. "When the (state) Supreme Court looks at the overriding intent of the legislation -- which I have trouble with -- I think they're going to find that the legislature was very clear (that) it did not want impositions placed (on conversions) simply when all that was happening was a change of ownership. . .
"I think the legislature was less than artful when it wrote that section because it says, 'You can't interfere (with conversions), yet you can have zoning laws.'"
William Dietch, GLM's project manager and general counsel, said he believes the BZA inappropriately took the view that variances needn't be granted unless the property would be worthless without them. Dietch, who calls this a "run-of-the-mill" variance case, argues that the ZBA action was an "absolute evasion of the restriction imposed by state laws."
Dietch also indicated that, if the controversy continues with the tenants, GLM may decide to shelve the condominium project and convert Covent Gardens to a cooperative instead because Virginia "has no restrictions on the conversion of rental facilities to go co-op."
"Our preference is to have an amiable conversion," he continued. "It's not our taste to get into confrontations with tenants. . . . Controversy is expensive. To the extent this process drags out much longer . . . here's much less room for tenant discounts."
GLM officials and tenants said GLM has offered each tenant a $7,000 discount if apartments are purchased "as is." For tenants who decide not to buy, GLM has agreed to help with moving costs.
Claudia Burns, the Falls Church housing expert who also coordinates tenant-landlord affairs for the city, said she is "very disappointed" over the protracted controversy.
Citing the city's desire to increase its small supply of moderately priced housing, Burns said. "There is the danger that (the units) are not going to be affordable to moderate-income people (if the delay escalates conversion costs). This is a golden opportunity for someone who wants to purchase a unit in the city."
Prices for the apartments have not been set officially. Tenant association president Jones, who has lived at Covent Gardens six years, said GLM representatives told tenants at a recent meeting prices could range from $53,000 for a one-bedroom unit to $73,000 for two bedrooms and den -- if they were sold at last month's prices.
Rents currently range from about $265 to $410 a month, plus utilities, Jones said. By her calculations, based on a 14.5 percent interest rate, monthly payments could range from $776 for the smallest unit to $1,031 for the largest.
"The folks here can't afford that," Jones said, referring to a tenant survey that found incomes averaging $15,000 to $25,000. "They're going to displace the tenants and they've said publicly that the tenants are not their concern."
(William Connelly, a GLM lawyer, was quoted in news accounts as telling the BZA, "Though human considerations should not be ignored, we feel they are irrelevant to the matter.")
Jones, who lives in one of the larger apartments, said GLM has turned deaf ears on proposals that the tenant and the firm form a limited partnership, and to suggestions that GLM allow the tenants to buy the complex.
Because of the tenants' frustrations in dealing with GLM, Jones and roughly 20 other Covent Gardensresidents made an unusual appeal to the City Council this week. They asked the council to consider entering into a special "cooperation agreement" with the Fairfax County Redevelopment and Housing Authority (FCRHA) that would enable the FCRHA to use its vast resources on behalf of the tenants.
In response, the council set a hearing for Jan. 22 on the complicated proposals and agreed to appropriate up to $5,000 to hire a special part-time consultant to assist the city planners in studying the plan.
If the council agrees to the request, the FCRHA could, among other things, seek to seize the complex by eminent domain with the approval of the council or could conduct negotiations with GLM for the tenants. Since the FCRHA also has bonding powers, it could assist the tenants in efforts to purchase the complex.
Eva Livingston, 77, who has lived at Covent Gardens 13 years and in Falls Church for 44, lives on a monthly annuity of $636. Her rent is $286 a month, plus utilities.
"I couldn't afford a condominium," she says. "By the time you pay taxes, water, electricity and maintenance -- I couldn't. I'd be lost if I had to go anywhere else. I've got my doctor and dentist right here, and I can catch a bus to Seven Corners or Tysons Corner, and everything. I'm a member of the Falls Church, and I can walk there. It would just break my heart to have to move."