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SF Condo Owner Accused Of Fraudulently Renting Out Below Market-Rate Unit

SAN FRANCISCO (CBS SF) -- A San Francisco man allegedly broke the rules of the city's affordable housing program by renting out his below market-rate South of Market condominium to tenants and then trying to sell it on the open market, according to a lawsuit filed by the city attorney's office Wednesday.

Gregory Garver, a licensed real estate agent, is accused of unlawful, unfair and fraudulent business practices and creating a public nuisance, according to the lawsuit filed in San Francisco Superior Court.

San Francisco's inclusionary housing program requires developers to set aside units to be sold or rented at below market-rate prices to low- and middle-income tenants.

In return, those buying or renting the units sign binding agreements that they will occupy the unit as their primary residence and not rent it out without city approval. The units also must be sold only to qualified low- or middle-income buyers at below-market rates.

Garber bought a below-market rate unit in the SOMA Grand Building at 1160 Mission St. in 2008, and signed an agreement spelling out the requirements of the program, according to the complaint.

By 2010, however, the complaint alleges that he had moved out of the property and begun renting it out.

According to the complaint, he rented it to one tenant for $2,400 a month from 2012 until July 2016, and then raised the rent to $18,000 a month, prompting that tenant to move out.

After the tenant moved out, Garver moved back in, but he began listing it as being up for rent again by December 2016. He also unlawfully listed the unit for sale, the complaint alleges.

The city is seeking a court order requiring Garver to comply with the law as well as civil penalties that could total hundreds of thousands of dollars, as well as attorney's fees and enforcement costs.

The lawsuit filed Wednesday by the city attorney's office is the third this year alleging violations of the inclusionary housing program by property owners.

© Copyright 2017 by CBS San Francisco and Bay City News Service. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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