In April 2020, Housing Justice Center represented a group of New Brighton tenants, along with HOME Line, in filing a class-action lawsuit against QT Property Management (QT), its owner Jason Quilling and the City of New Brighton. QT acquired Pike Lake Apartments, a 1960s-era complex where residents paid between $700 and $900 a month for one- and two-bedroom apartments, in winter of 2019. On New Year’s Day, the families in Pike Lake’s 60-plus apartments received notices to vacate that were slid under their doors. They were left scrambling for new housing in the dead of winter and the middle of the school year, with limited budgets in a tight rental market.
Residents of Pike Lake organized alongside representatives of HOME Line, pleading for assistance and more time to move in front of the New Brighton City Council. Meanwhile, QT wasted no time starting widespread unsafe construction inside the buildings. While residents continued to legally occupy their units, QT turned Pike Lake into an active demolition and renovation site. HJC showed extensive photographic and video evidence to the Court that the tenants were subjected to loud construction noise all hours of the day, starting at dawn, including on weekends. Demolition was active immediately outside tenants’ doors—QT set up a table saw in the hallway, ripped up flooring, and left nails on the ground. Workers threw demolition debris out of upper story windows, leaving broken wood, twisted metal, ripped out carpeting, shattered tiles, and demolished appliances on the building grounds all day and piled in overflowing dumpsters overnight.
HJC argued QT engaged in “construction harassment,” a tactic increasingly used by landlords to oust low-income renters by making living conditions unbearable, remodeling the building, and bringing in new tenants for much higher rents. HJC alleged that QT’s construction harassment tactics violated basic Minnesota tenant and consumer protection laws and endangered the health and safety of the Pike Lake tenants. HJC also alleged the City of New Brighton aided and abetted QT’s unlawful activities by allowing QT to circumvent licensing and permitting ordinances. In April 2020, HJC brought an emergency motion to stop construction harassment at the property, which led to an agreement by QT to change its construction protocols. Then, in November 2020, the Court denied QT’s attempt to dismiss the case, making a number of legal rulings supporting HJC’s arguments in the case. In January 2021, the parties reached a class settlement agreement, wherein they agreed to a monetary settlement of $250,000 and non-monetary settlement conditions including appropriate construction protocols at all QT properties. On May 5, 2021 the Court will hold a hearing to decide whether to give final approval to the settlement.
Pike Lake is far from the first unsubsidized affordable apartment complex to change hands in this fashion. The trend goes as follows: the building is sold, new management “fixes it up”, tenants are displaced, and the building is driven upmarket. Now that renovations at Pike Lake are complete, rents have climbed to $1200. According to the suit, “QT took over Pike Lake Apartments confident that they could quickly clear out the tenants and convert their apartments because the tenant population had racial, disability, and public income characteristics making it unlikely that individual tenants had the power or resources to resist.” Around 60% of recent Pike Lake residents were people of color, and many of the white residents were disabled or living on public assistance.
Several West-metro suburbs have enacted tenant protection periods following the sale of an affordable housing building, which help in cases like these. These ordinances require new owners to pay relocation benefits to tenants who choose to move within three months if the owner increases the rent, rescreens existing residents, fails to renew leases without cause, or engages in construction harassment. The City of New Brighton passed one such ordinance in December 2020 in response to the events at Pike Lake.