For a couple of weeks last summer, an apartment building on Webster Street in downtown Oakland had no hot water. Tenants complained to their landlord about the cold showers, and as compensation they were offered a reduction in rent. 

The amount offered to two tenants we spoke with was about 10% of their monthly rent, roughly $75 to $100, in the single-room occupancy (SRO) building, where residents have their own bedrooms but share communal kitchens and bathrooms. To get the deal, the landlord required each tenant to sign a contract within a few days of receiving the offer.

That was when some of the renters noticed a catch. By signing the form, they agreed to never sue the landlord over any issue in the future, to never speak negatively about the landlord—publicly or privately—and to never mention the existence of the contract after signing it.

“You signed away your rights,” said a tenant who completed the form before noticing these terms. “It was quite a long document and I’m not fluent in legalese.”

The Oaklandside agreed to not name the tenant because he is concerned about the legal consequences he could face for talking about the contract. We reviewed the document and spoke with two tenants in the building, one of whom shared email exchanges between her and the property manager.

The tenant who signed the form said he knew of several others who did too, in order to receive the rent reduction. 

“When you’re kind of struggling and living in an SRO, that’s a lot of money,” he said.

The apartments at 1515 Webster St. are operated by New York-based Common Living, which has 10 buildings in the Bay Area and numerous others in major cities across the U.S. Some are traditional apartment buildings and others, like on Webster, are what the company calls “co-living.” 

“At Common Webster your rent gets you more: a private bedroom with oversized windows (aka the perfect peaceful retreat), shared lounges made for movie nights or remote work, a spacious kitchen designed for roommate living, and extra perks like a pool table and on-site laundry,” the company’s website says. 

Common reportedly raised $100 million in venture capital to carry out its concept around the country, and last month merged with Habyt, Europe’s largest co-living company. 

The co-living concept shares many characteristics with SRO hotels that have long provided a lower-cost residential option, sometimes rented by the week or month, because the units don’t have private kitchens or bathrooms. Co-living is often marketed as college dorm-style housing for young adults, with entertainment perks and social gathering areas. The idea gained some initial popularity over the past five or 10 years, but one of the most prominent examples, WeWork brand WeLive, failed to take off.

Common’s downtown Oakland property occupies the top two floors of an ornate former YWCA building, with the high school campus of Envision Academy, a charter school, operating below. There are about 60 units on the Common floors, according to tenants.

The hot water contract, said the renters, is just one of many issues they’ve experienced living in the building, and their descriptions reflect problems documented at other Common properties.

Lawyers say banning lawsuits and criticism is ‘unconscionable’

Housing lawyers who reviewed the rent reduction form at The Oaklandside’s request said the conditions that Common required tenants to agree to were unfair and potentially unenforceable.

“It is way heavy-handed, overbearing, and bullying,” said Marc Janowitz, staff attorney at the East Bay Community Law Center. “It’s using all of the leveraging and dominance of the position the landlord has, to gain a very, very unfair advantage over the tenant.”

Janowitz said a contract is considered legally “unconscionable” if it’s one-sided and abuses the difference in power between the two parties.

“I am very confident a court would say this is the very definition of unconscionable,” if a tenant was able to get a lawyer to represent them, Janowitz said. “But the cruel reality of our legal system is it’s pay-to-play, and the writers of this [form] know that.”

The Oaklandside contacted Common’s press office, and received a response saying, “At this time, a representative is not available to provide a comment.” After we sent a follow-up message with several written questions they agreed to an interview, then retracted that decision the next day.

Janowitz said the exact meaning of the contract’s terms aren’t clear, including the section that says the contract “fully, forever, irrevocably and unconditionally releases and discharges Landlord and Owner…from any and all claims and rights which Tenant may have against them,” whether they’re related to the hot water issue or not. 

“Do they really mean the landlord can run you over with his automobile and you can’t do anything about it?” Janowitz said.

Peter Selawsky, an attorney at the Eviction Defense Center, was similarly skeptical that the clause prohibiting lawsuits could apply as broadly as it was intended to.

“You have an unwaivable right to a habitable apartment,” Selawsky said. “You can’t sign that away, saying that when plumbing goes out five years from now, there’s nothing you can do about it.” But he said many tenants might believe what’s in the contract regardless of how a judge would or wouldn’t interpret it.

In exchange for the lack of hot water, the landlord should offer monetary damages for the harm caused, not asking for anything else in exchange, Selawsky said.

In Oakland, there is no specific compensation that a landlord is automatically required to provide tenants if their building’s hot water stops working. But if a landlord agreed to offer their tenant specific things as part of the lease—like hot water, a parking space, or on-site laundry—and any of those things are suddenly taken away, it could be considered a reduction in housing services and could entitle a renter to financial compensation. To access reimbursement, a renter must file a petition with the city’s Rent Adjustment Program and go through an administrative process to determine what they’re owed.

The Oaklandside asked housing lawyers with the city attorney’s office whether they’ve come across forms similar to the contract Common had its renters sign in order to receive compensation, and whether the terms are legal. A spokesperson for the office declined to comment, saying the city attorney doesn’t provide legal advice to members of the public.

Tenants report mold, broken elevators, managers entering rooms

Tenants who spoke with The Oaklandside said the lack of hot water is one of several issues they’ve experienced in the building. The elevator, which is the only way to access the residential floors without triggering a fire alarm, is frequently broken, they said.

There has been turnover among on-site property managers and cleaning staff, leading to inconsistency in the communal items that Common promises, like toilet paper or utensils, the renters said. Tenants also mentioned instances when someone working for Common entered their units with either no notice, or minimal advance notice, and described antagonism between the renters and managers.

When an Oaklandside reporter and photographer visited the building recently, the common areas appeared to be clean, and amenities that Common advertises—a pool table, a TV, a free laundry facility—were available. One of the shared bathrooms sported a large hole in the ceiling. A tenant said the management company cut that hole to address a leak but never patched it, resulting in water pouring down into the bathroom when someone in the room above it takes a shower.

City records show that there have been three complaints filed by tenants in the past year, about the bathroom hole and mold.

There are numerous security cameras visible throughout the Common property. A tenant said they were likely installed in response to several cases of theft and strangers entering the building. He noted that they create an atmosphere of surveillance that makes the common rooms feel less like community gathering places.

The Oaklandside also reviewed one tenant’s recent rent statement. In addition to the rent amount agreed upon in their lease, there was a roughly $10 charge labeled “business tax.” Rental property owners in Oakland must pay a tax of $14 per $1,000 of rental income they bring in. The tax is generally paid by the building owner—in this case a company called HBO Webster Street LLC—not a property manager like Common. Either way, that charge cannot be transferred to the tenant, the city said. 

In May 2022, the Daily Beast published an article outlining numerous complaints about security, landlord responsiveness, and deferred maintenance by renters at several Common locations, including the Oakland building. Founder and CEO Brad Hargreaves told that publication that some of the safety and cleanliness issues could be attributed to dynamics among the renters, noting they increased when people began spending more time at home during the pandemic. (Hargreaves reportedly stepped down in August but is still listed as CEO on Common’s website.)

Sometimes Common will send a notice to renters at the Oakland building threatening to charge them if they don’t clean up something in a communal area, like a dirty kitchen sink, said the tenant who signed the hot water contract.

“Then it feels like, now I gotta clean up the mess of 40 people,” he said.

Despite the problems, the tenant has no plans to move out when his lease is up. He said many of his building-mates are “young people, people who are down on their luck, and some people who are addicts,” all of whom have few alternative options during a housing crisis.

“If I had a rich daddy taking care of me I’d live somewhere else,” he said. “But I just don’t. It’s what’s affordable to me and allows me to stay in the Bay.”

Selawsky of the Eviction Defense Center said there are several organizations that offer free legal services to renters in the East Bay, where lawyers can provide information on tenants’ rights and review paperwork like the hot water compensation contract before it’s signed.

“I think any attorney would have said this is not a good deal,” he said.