After Yearlong Rent Strike, Brightwood Building Sells To Tenant-Selected Investor
A Northwest D.C. building where some tenants participated in a rent strike for more than a year has traded hands.
An affiliate of D.C.-based Novo Properties acquired the 24-unit building at 1320 Nicholson St. NW for $3M from Michael Lesesne in a deal posted Dec. 2 to the D.C. Recorder of Deeds.
Residents of more than half of the building's units began a rent strike Oct. 1, 2018, organized by Latino Economic Development Corp., because of complaints over the building's conditions including roaches, mold and leaky roofs.
Marcus & Millichap's Marty Zupancic and Christian Barreiro brokered the sale on behalf of Lesesne. Barreiro said some, but not all, of the participating tenants continued the rent strike through last month.
"There were some tenants that held true in terms of the rent strike for that period of time, and there were some that paid," Barreiro said. "It was kind of a mixed bag. The owner was not getting full collections at the end of every month, so he had to withstand that, and eventually we were able to persevere and close the deal."
Barreiro said the negative headlines created by the rent strike did not dissuade potential investors, with about 25 touring the property and eight making bids. The residents organized through D.C.'s Tenant Opportunity to Purchase Act and ultimately selected Novo Properties to buy the building, Barreiro said.
LEDC Senior Organizer Citlalli Velasquez, who worked with the building's tenants, confirmed that the residents chose Novo Properties through the TOPA process and that the buyer has agreed to address the issues that led tenants to strike.
"We believe the rent strike pushed the landlord [to] sell, which came to a benefit to tenants," Velasquez said in a statement emailed to Bisnow. "They were able to partner with a developer, NOVO, of their choice, to execute a development agreement that brings the building up to code, replaces/repairs faulty systems, a new community room, increases security, and [adds] several other benefits to tenants."
Lesesne's family has owned the property since 1981. He retained Marcus & Millichap to sell the property last year after he was diagnosed with Stage 4 cancer, Barreiro said.
"I had lunch with him to celebrate and he was very pleased; he’s had to deal with numerous cancer treatments," Barreiro said. "He was happy to foster the sale of the building to the new owner. Novo aligned with the tenants association and will improve the building and make it a place where they want to live."