Residents at the UC-owned, 168-unit Hilltop Apartments on Western Drive in Santa Cruz described problems with rats, delayed maintenance and unexplained charges. (Nik Altenberg — Santa Cruz Local)

SANTA CRUZ >> Several tenants at the University of California-owned Hilltop Apartments on Western Drive in Santa Cruz said they have dealt with rats, raised rents, and questionable charges related to utilities and parking from a multinational property management company. 

UC leaders purchased the complex to convert it to student housing and cash in on a housing crunch exacerbated by the university’s growth, housing advocates said. The UC Office of Investments purchased the property in 2021 and raised rents on dozens of units, according to the purchase agreement and tenants. Some longtime residents were displaced.

UC Santa Cruz officials advised UC leaders on how to make the apartments more attractive to its students, then distanced themselves from the property. 

As UCSC students return to classes this week, the Hilltop is leased almost entirely to UCSC students. UC leaders said they bought the property to provide student housing, yet they raised rents and told the UC Regents that the property was an investment destined to rise in value.

“It’s so frustrating because it’s exploiting the housing crisis for their financial gain,” Lola Quiroga, vice president of UCSC’s Student Housing Coalition, said of UC. “They know they can put up these ridiculous prices, and they know students are going to pay for it — because that’s all we have because of the severity of the housing crisis in Santa Cruz.”

‘A return on investment’

When UC bought the 168-unit complex in 2021, the property already had a reputation for high rents, high water bills, lagging maintenance, poor management and unexplained charges. The problems can be traced to when a longtime owner of the Hilltop Apartments sold the property to Goldman Sachs Asset Management LP in 2018. Greystar Worldwide LLC took over its property management in 2020.

When the UC purchased Hilltop for $118 million in late 2021, it went “from chaos to cataclysm,” said Brenda Tuttle, 85. She has lived at the Hilltop for almost 16 years.

The UC bought the Hilltop and other properties near its campuses across the state in recent years “purely as investment assets, to make a return on investment for our pensioners and for those in the endowment,” said UC Chief Investment Officer Jagdeep Singh Bachher, at a UC Regents board meeting last year. “Candidly, owning anything around a university seems to be profitable,” he said.

“If you own real estate around a university, there’s kind of only one thing that happens to its price over time. It just goes up.”

—UC Chief Investment Officer Jagdeep Singh Bachher

Singh Bachher added that the acquisition of the Hilltop was a way to provide housing for students, even with raised rents. “I personally got very tired of listening to how our students were sleeping in cars in Santa Cruz and were homeless. So we took a step — we bought housing in Santa Cruz,” he said at the meeting.

Zav Hershfield worked as a program coordinator for Tenant Sanctuary when, one week in spring of 2022, “we started getting a whole bunch of people who lived at the Hilltop contacting us about the same issue.” The residents had received notice that they had to move out of their apartments because the units were going to be remodeled.

Many of the tenants were “within their rights to say, ‘no, thank you,’” he said, but they didn’t know that. The small nonprofit didn’t have the capacity for the sudden surge of requests and was unable to assist everyone, Hershfield said. “A lot of people actually ended up moving out.”

In February 2023, Santa Cruz Mayor Fred Keeley wrote a letter to the UC Regents stating that the city was concerned the “lease terminations may have been unlawful,” according to records obtained by Santa Cruz Local. In an interview this summer, Keeley said he stands by what he wrote in that letter. 

“The university buying up existing housing and converting it into student housing does nothing to solve the problem” of not enough housing for UCSC students, Keeley said.

Zav Hershfield puts a flier on an apartment door at the Hilltop Apartments in May 2022. Hershfield was program coordinator for Tenant Sanctuary when dozens of residents received notice of remodels and rent increases that year. (Nik Altenberg — Santa Cruz Local file)

In a Feb. 6, 2023 letter to UC and UCSC leaders, Santa Cruz Mayor Fred Keeley describes his concerns with the UC’s purchase of the Hilltop Apartments and subsequent rent hikes. (City of Santa Cruz)

A 24-year-old tenant named Amanda said she and two friends lived at Hilltop in 2022 when they received a notice about renovations. She didn’t know whether they had a legal right to remain in their apartment, but when they received the notice, they willingly moved to another two-bedroom at Hilltop. Their rent went up to $4,200 from $3,000 for a similar apartment.

The Hilltop was “a really full apartment complex, filled with a good amount of students, but a mix of families and what have you,” Amanda said. Following the rent hikes, “there was kind of a whole great leaving of people, of community members who weren’t students, who had to leave because they couldn’t afford to live there.” 

Afterwards, she said, “it remained really, really empty for a while and it was only students moving in.”

Longtime residents pushed out

For at least a decade prior to UC control of Hilltop, the apartment complex had always been about half students because of its proximity to campus. Today, the “vast majority” of residents at Hilltop are UCSC students, said Tuttle.

Ed Reiskin, UCSC vice chancellor and chief financial officer, said UCSC leaders were not involved in the purchase but advised UC on how to accommodate students at Hilltop.

“We talked to them about, you know, how to structure leases and do things that might make it attractive to students, what our pricing is so that they would be comparable. But, you know, all decision making is theirs in terms of how it operates,” Reiskin said.

“One thing that we wanted to be cautious of, and we warned them about, was the reality or even the perception that UC was coming in buying an apartment complex, kicking Santa Cruzans out to move in UCSC students,” he said.

In response to questions about the rent hikes, Reiskin said, “The information that I saw seemed to suggest that they were setting rents comparable to what our current student housing is.” Reiskin also said Hilltop is one of several places students are referred to for off-campus housing when there are no beds available on campus.

Amanda said she didn’t know that UC owned the Hilltop until her rent was raised by $1,200.

“They know the students are an easy target, because they’ll put up with it if they know it’s temporary, and then they just leave. And they can just keep artificially increasing the rent, which then affects everyone else in town,” she said. Santa Cruz Local is not publishing her last name because she said she felt intimidated by Greystar management.

The Hilltop Apartments are at 363 Western Drive, not far from UC Santa Cruz. (Nik Altenberg — Santa Cruz Local)

Rats and lagging maintenance

The month after Amanda and her roommates moved to another apartment at Hilltop, they reached out to UCSC hoping to take advantage of the campus’ free legal advice services for students who live off campus. They were having issues with maintenance that was so slow they bought their own drain snake rather than wait for someone to come unclog the shower.

The students were denied because “the Hilltop Apartments are a university owned property,” according to an email sent by UCSC Associate Dean of Students Travis Becker. Becker said he was unsure if that was still the current policy and referred questions to UCSC spokesman Scott Hernandez-Jason.

Hernandez-Jason wrote in an email, “UC Santa Cruz does not have any involvement in managing The Hilltop Apartments.”

Julie, who did not want to share her last name for fear of retaliation, lived at the Hilltop from 2022 to 2024. She described a nightmarish saga that began last year when she and her housemates returned from spring break to find rats in their apartment. 

“It was dealt with horribly,” Julie said of the property management’s response. She described weeks of back-and-forth emails and phone calls with Hilltop staff. She said she missed several days of classes and work so she could be home to meet repair people who sometimes didn’t show up or were hours late. 

Julie said she met with multiple potential contractors because there was a “bidding war” to fix the rat problem.

It took more than six weeks from the time Julie and her housemates, all UCSC students, first alerted Hilltop managers for the rat problem to get resolved. Julie requested financial compensation and received a $2,000 reimbursement, about two weeks of rent for the $4,045 one-bedroom apartment.

Amanda also said she saw a rat in her apartment. But, she said, she filled a hole where the kitchen sink drain went under the house, and never saw a rat again.

A rodent hops down from a Hilltop resident’s pantry last year. (Contributed)

A Greystar representative said the firm responds to problems. “The well-being of our residents is a top priority, and the Hilltop addresses properly reported issues in a timely manner,” the representative wrote in an email. “Any reported pest issues are referred to professional exterminators. We also follow all preventative measures made by our pest control vendor as well as follow a calendar of regular inspections and preventative pest control treatments.”

Several Hilltop residents said rats could get into homes from a crawl space below the apartments. After repairs, a hole above a carport remained. (Nik Altenberg — Santa Cruz Local)

Unexplained charges, sloppy bookkeeping

One former resident said her roommates were overcharged for months after she moved out and Hilltop continued to bill them for her share of utilities. She said they are still fighting the charges months later.

Two former Hilltop residents said they owed nearly $1,000 after Hilltop managers had accidentally not charged them for parking for nearly a year, and had to pay the full sum within 10 days.

Amanda said she and her roommates were charged a monthly $50 fee because they hadn’t put the Pacific Gas & Electric Co. account in their name. She said they were never informed of this and put the bill in their name as soon as they discovered the charge. 

Several former residents also said water bills were at times inexplicably high. They alleged that Greystar was passing on the cost of water for the pool, landscaping, laundry facilities and water leaks. 

Carmen Maldonado, Hilltop’s manager, told Santa Cruz Local there were no billing issues with unexplained charges.

Tuttle said that for the last year there have been unexplained charges on her account. She said when she brought it up to management, they told her not to worry about it. 

“I get threatening messages, at one time I began to get phone calls and I really got outraged about that,” Tuttle said. “They stopped that, but they still haven’t fixed the inaccuracies.”

Greystar is one of the largest property management companies in the world and manages more than 700,000 apartments in the U.S. The company has faced several class action lawsuits over the years, including one filed this month in a federal court in San Diego that alleged “junk” utility fees. 

How UC became the landlord

Neither UC Santa Cruz nor UC leaders notified the City of Santa Cruz of the purchase of the Hilltop. A 2008 settlement agreement between the city, the county and the university had required notice if the university intended to buy property in the city. The agreement expired in September 2021, and UC completed the purchase of Hilltop in October 2021, according to the purchase order. 

Reiskin and Hernandez-Jason said UCSC had no involvement in the Hilltop purchase.

However, an email obtained by Santa Cruz Local states that David Silver of Throckmorton Partners, the real estate broker for the sale, thanked UCSC Chancellor Cynthia Larive for “all the time you spent on Hilltop over the years.” It stated, “We have always been hopeful that the UC would eventually own Hilltop and that the campus and students would benefit from this housing for decades to come.”

Larive did not respond to multiple requests for comment for this story. 

“UC Santa Cruz was invited to consider purchasing Hilltop Apartments in 2021,” Hernandez-Jason wrote in an email. “However, in the midst of the global pandemic, we ultimately did not move forward. Due diligence when considering a purchase requires engagement with the UC Regents and the UC Chief Investment Officer which also made them aware of the opportunity.”

The UC Office of Investments did not respond to requests for comment.

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