Families Who Dared to Dream : Home Building: Households pooled resources, pinned hopes on a partnership to build new single-family houses in Wilmington.
Every Saturday and Sunday at 6:45 a.m., truck driver Manuel Lopez leaves his tiny apartment for a dusty construction site on the east side of Wilmington.
There, in a low-income neighborhood where nobody can remember the last time a developer built a single-family home, Lopez spends his weekends doing just that.
After six months of work, the four-bedroom, three-bath house that he intends to share with his wife and three children is finally taking form.
“It’s a very nice house,” Lopez said recently, climbing down from the roof for a brief break from his work. “The type of house I dream of all my life. So finally I get it.”
As unusual as new home construction is in the community, the Lopez home--with its stucco exterior, red tile roof, large windows, fireplace and vaulted ceilings--will not be the only new one on the block.
Eighteen others are going up alongside it--all of them part of a gutsy do-it-yourself development that promises to change east Wilmington, as well as the lives of some who, like Manuel Lopez, never dreamed they could become homeowners in Southern California’s expensive real estate market.
The homes, expected to be finished in February, are being built by a group called Home Owners Partnership. Their project began nearly three years ago, when a group of Wilmington residents pooled their money--$15,000 each, much of it borrowed from friends and relatives--to get into the house building business.
Besides helping themselves, they wanted to show bankers, developers and city officials that there is a market for single-family homes, rather than apartments, in Wilmington--even in east Wilmington, where oil pumps, junkyards, abandoned cars and gang graffiti are an integral part of the urban landscape.
With experience in neither real estate investment nor development, they formed a limited partnership and used the $285,000 they had raised for a down payment on 3 acres of land at L Street and McFarland Avenue.
The lot is half a block from Holy Family Catholic Church, the focus of religious and social activity in the predominantly Latino eastern section of this industrial community near the Port of Los Angeles.
As blue-collar workers, many with experience in construction, the investors--most of whom already knew one another from parish activities--figured they could build single-family homes and cut costs by doing some of the work themselves.
“This was to show the city of Los Angeles that the community not only wanted this kind of housing, but it can be done,” said Peter Mendoza, who is heading the project and also is president of the Wilmington Home Owners, the area’s largest residents’ organization.
“If some developer from out of town would have done this in Wilmington, I would have been tickled to death,” he said. “But nobody would do what we’re doing.”
Technically, the development is a condominium project--a designation that was made because the group could not meet the city zoning requirements for single-family housing.
As it turns out, Mendoza said, the condominium designation has given the group an added benefit: an owners association through which residents can control the maintenance of their neighborhood.
Mendoza, a former aerospace engineer experienced in carpentry, is the general partner in the project but will not own one of the homes.
After organizing the land purchase and securing financing for the venture, he obtained a contractor’s license and now acts as construction supervisor on the project.
For his full-time work on the development, Mendoza will earn 10% of the difference between the cost of building each home and its appraised value.
The homes--eight one-story and 11 two-story--will range in size from 1,500 to 2,400 square feet. Mendoza estimates they will cost between $120,000 and $145,000 to build, depending on size, and that the appraised value of even the smallest ones will approach, if not exceed, $200,000.
The partnership employs about eight full-time workers and has hired professionals to design the homes, pour the concrete foundations, lay sewer and water lines and supervise electrical and plumbing work. But otherwise, it has been a family affair.
Plumber Albert Perales, for instance, pitched in when he heard his friend’s uncle, Sam Revelas, needed help. Robert Rivas, a Wilmington longshoreman, recruited his 18-year-old son to help him build his house.
Jaime Fernandez, also of Wilmington, quit his $16-an-hour job at the nearby Unocal Refinery to work full time on the development, where he earns just $10 an hour as a carpenter. He did so, he said, because his older brother and sister are both investors. He expects to live in his brother’s home.
“It’s a lifetime opportunity,” Fernandez said.
Not all the project participants are first-time home buyers. Rivas and his wife, Irene, already own a home in west Wilmington, considered a better neighborhood than the east side. But they intend to rent that house, where they have lived for 22 years, and move into the Home Owners Partnership development.
“I’m willing to make the change to make this a better side of town,” said Irene Rivas, who works in the office at a local elementary school.
“We in Wilmington have a bad reputation. Nobody gets to know the real people that are here, the real good people, the kind and caring people.”
Aside from their commitment to the community, the Rivases believe the Home Owners Partnership project is a good investment. And so does the Bank of San Pedro, which is financing the development with a $2.2-million construction loan.
The bank’s president, Lance Oak, described the project as “a real good opportunity for both of us.” Mendoza, meanwhile, credits the bank with making the project work. He said the partners were turned away by every other lending institution they approached.
Obtaining financing was not the only hurdle the partners had to jump. The investors encountered countless delays moving through the city bureaucracy. They fought--and won--a tough battle with Exxon Corp., which ultimately agreed to cap a well on the property. And they sweated it out for months while their title company conducted a complicated search to determine that no other oil company had rights to the land.
The delays frustrated the partners, and three dropped out, although they were later replaced. Others fretted as home prices spiraled upward. Some said they were ridiculed by friends and family who told them they were investing in a pipe dream.
“It was always waiting, waiting, thinking we could buy that house right now, instead of being in that project,” said investor Eliseo Sanchez, a chemical process operator. He and his wife, Ana, a teacher, stuck with the project despite criticism from those who “thought we were just throwing our money away.”
At one point, Lopez and his wife also considered dropping out, but decided against it after a brief foray into the home buying market.
“We checked the prices,” he explained.
In retrospect, Lopez said, he has few regrets about the wait: “I’ll have a house for my family, and that’s the most important thing.”
BACKGROUND
In 1986, the Wilmington Home Owners--the largest residents group in this industrial area near the Port of Los Angeles--successfully persuaded the Los Angeles City Council to impose a moratorium on high-density apartments in their community. Later that year, Home Owners Partnership was formed in an effort to show city officials that there is a market for single-family homes in Wilmington. The activists may have succeeded. This month the Los Angeles Planning Commission adopted a new community plan that calls for much of east Wilmington, the neighborhood that houses the Home Owners Partnership development, to be zoned for single-family use. That document now awaits council approval.
