Single-room-occupancy hotels are some of the last scraps of low-income housing left in San Francisco. But for the city's high-tech strata, they're just another piece of property to flip for profit. And one tech-centric housing company stands accused of using unlawful evictions to turn a SoMa SRO into a gaudy co-op for dozens of tech workers.

The Negev, a startup that creates living spaces with "mostly hackers & founders" as tenants, has put together a small empire of San Francisco communes. They promise "instant friends & community" to people moving into town, assuring their tenants that prospective housemates have been "interviewed both on a personal and technical level."

However, its latest property was acquired through what lawyers describe as "wrongful evictions."

1040 Folsom Street was damaged in a 2011 fire, forcing tenants—most of whom paying less than $1,000 a month in rent—to temporarily relocate. San Francisco's rent-control ordinance stipulates that those tenants were legally entitled to their old rentals at their previous rent.

However, the SF Examiner reports the property was quietly scooped up The Negev. After the company took over the property and began subleasing rooms and bunk beds to tech workers, The Negev's co-founder tried to buy-off the old tenants with a paltry cash offer:

[Former tenant Patricia Kirkbride] said she had no idea the building repairs were complete until one of the new building lessees, Danny Haber, 26, knocked on the door of her new home at another single-room-occupancy hotel a few weeks ago and offered her $500 in cash if she waived her right to return and all claims against him — basically a buyout. She didn't take the money. [...] When Kirkbride visited the two-room unit that she leased for $634 per month on the top floor of the three-story building, she said she found a wall had been erected, dividing the two rooms into separate units. Furthermore, new tenants were already residing there.

Kirkbridge and other former tenants at 1040 Folsom are now suing The Negev, saying they were illegally denied the opportunity to move back into their old homes (lawsuit embedded below).

According to the Examiner, The Negev advertised the rooms for rent as a place for people in their 20s:

Rooms at The Negev on Folsom Street have been advertised on Craigslist. One post titled, "$1500 Awesome Co-Op Folsom Street — young professionals" started with the description: "We are like minded group of people, all of us are in our 20's, we are active, into sports, and looking to constantly learn something new (everything from programming to new meditation methods)." The listing said the roommates included an engineer at Google, an associate program manager at Google, a front-end Web developer at Edmodo, among others.

The Examiner reports the building is unfinished with exposed plywood covering walls and rooms labeled with masking tape, suggesting The Negev is also hacking around building costs in addition to tenant laws. But that should be no concern for the types of people that are into sales and partying.The Negev's website pitches:

Like minded group of people who are into entrepreneurship, sales, engineering, and partying. Family dinners on sundays, parties every 3 weeks, yoga on Fridays, and weekly talks from well known people mostly in the technology world. Consists of both guys and girls.

Unfortunately, it's too late for the tenants that were pushed off the property following the fire. One 63-year-old tenant told the Examiner "it's physically impossible to reoccupy."

To contact the author of this post, please email kevin@valleywag.com.

Photo: The Negev