San Diego’s genuine estate team requires audit over Penny Maus

San Diego’s leading genuine estate official did not request enter from her staff members or evaluate internal documents prior to recommending the metropolis obtain out the 101 Ash St. lease, a sweeping new grievance alleges.

The memo to the Metropolis Auditor’s Workplace also suggests authentic estate director Penny Maus imposed a 3-yr limit on leases in get to bypass the Town Council and that workers have been explained to not to react to email messages from other office heads, council workplaces or even the mayor.

All those are between a collection of grievances in excess of the past two years that the document recounts. It suggests it is the latest attempt to power transform immediately after prior complaints to senior officials, human methods managers and even union leaders went unaddressed.

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“The metropolis of San Diego really should be aware of the degree of squander and abuse that is taking place in just the genuine estate and airport administration office, which has led to a toxic, hostile, income-throwing away and unproductive operate atmosphere,” says the private memo, a duplicate of which was reviewed by The San Diego Union-Tribune.

The 10-web site complaint is dated Feb. 21 and tackled to assistant town auditor Matt Helm. The Metropolis Auditor’s Workplace declined to remark, outside of saying it is being addressed like any allegation submitted to the business.

It is unsigned but claims to have been created by workers who report to Maus, the previous Port of San Diego manager who was brought in by Mayor Todd Gloria soon after his 2020 election victory.

According to the memo, modifications pushed by Maus in the name of reform have backfired, resulting in men and women to leave, depressing morale and losing taxpayer bucks.

“Please do not undervalue the particular threat that we are using by filing this grievance and we do not pursue this flippantly,” its authors say. “We do sense our professions and name are at the moment at chance or we would not be using this step.”

The Mayor’s Office environment declined to deal with the allegations or Gloria’s self-assurance in his real estate director. A spokesperson issued a temporary assertion endorsing an exterior evaluate.

“The metropolis of San Diego can take all allegations of fraud and abuse significantly, and we will assist any investigation into these promises that the metropolis auditor chooses to perform,” spokesperson Rachel Laing claimed by e-mail.

Council President Sean Elo-Rivera stated in a statement that he respected staff members for coming forward.

“The accusations are relating to and must be taken seriously,” Elo-Rivera mentioned. “I foresee the audit committee’s overview of the make a difference and, as generally, will give major consideration to any recommendations.”

In accordance to the memo, an unhealthy work setting in the department has diminished productivity.

In the a few a long time ending June 2020, the office accomplished 389 home agreements, about 11 every single month. Just 79 offers were closed in the 18 months ending in December, an regular of 4.4 for every thirty day period, the staff members stated.

Michael Zucchet, common supervisor of the Municipal Staff members Association, the union that represents the city’s white-collar staff, mentioned the memo was penned by about a dozen staff.

His workers began listening to “alarming and substantive complaints” about Maus and her therapy of his users previous summertime, Zucchet explained.

“We typically communicated what we were being listening to to many associates of the city’s HR workers, and then on Sept. 26, 2022, MEA submitted a formal written grievance with the director of the city’s HR office,”he mentioned.

That submitting comprehensive precise threats and policy violations the union alleged Maus and her senior employees experienced dedicated in opposition to lessen-level staff members, he claimed.

Zucchet reported he gained a reply from the human means director indicating that she experienced “shared and discussed the details with town management and the make any difference is remaining addressed internally.”

He said the personnel chief declined to offer any aspects “due to the nature of the complaint” and he has not read from her given that.

“We are let down that it has taken so prolonged, offered the severity and magnitude of the allegations,” Zucchet mentioned.

For her component, Maus issued a quick assertion.

“Our workforce has worked tricky to enhance the city’s true estate office and I am proud of our progress,” she wrote. “I welcome entire transparency and seem forward to the truth being shared.”

She did not reply to the allegations that she experienced confined town leases to 3 decades to prevent council evaluate, banned staff members from responding to exterior e-mails and manages a harmful and hostile workplace.

Read to Dream

Maus arrived at San Diego Town Hall two several years in the past this month, billed with remaking a section that experienced been blamed by equally Gloria and former Mayor Kevin Faulconer for a series of real estate blunders by the metropolis, which includes the 101 Ash St. transaction.

In accordance to her profile on LinkedIn, Maus was awarded a bachelor’s degree in political science from Northern Illinois University in 2001 and a master’s in business enterprise administration from the University of Phoenix five yrs later on.

Maus invested a number of a long time in the personal sector right before having a job as an asset manager at the Port of San Diego, where by she was inevitably promoted to actual estate supervisor.

The 13-yr port veteran succeeded Cybele Thompson, who resigned in 2020 as more aspects emerged on the city’s lease for the previous Sempra Strength headquarters at 101 Ash St.

Thompson and 3 other top Faulconer administration officials testified in subsequent depositions that the lease-to-individual offer was pushed at the mayor’s way, even however it was a lot more costly than acquiring the creating outright.

Gloria tasked Maus with reorganizing the Serious Estate Property Office, very long recognized as Go through, which had boosted yearly profits from $45 million in 2014 to about $60 million in 2020.

Inside of months, it was rebranded the Division of Genuine Estate and Airport Management, or Desire.

The business office now manages additional than 1,600 metropolis-owned attributes totaling some 123,000 acres, together with parks, fire stations, law enforcement stations and Petco Park, home discipline for the San Diego Padres.

Most of the department’s do the job will involve running existing leases and negotiating extensions, alternatively than acquiring and providing city properties.

The office environment also oversees the airports at Montgomery and Brown fields. This 12 months, the city boosted the department budget by some $3 million, to $38 million, and improved its budgeted employees from 54 to 66 folks.

But according to the complaint, 1 quarter of the personnel has left in the previous year, and 30 per cent of complete-time positions are vacant.

“One hundred p.c of the Go through workers who have departed in the past two years have cited current management as their motive for leaving,” the report to the metropolis auditor explained.

It also suggests assets brokers are dependable for “well about 100 leases” just about every, “which is an fully unmanageable workload.”

Maus introduced in longtime port associate Lucy Contreras as her best deputy. In accordance to metropolis spending plan files, office earnings climbed to extra than $75 million final yr and is believed to surpass $82 million this 12 months.

But the outsiders have not endeared by themselves to the complaint’s authors.

In addition to banning created replies to e-mail from exterior the department, the grievance alleges, section leadership demanded leases of no additional than 3 years so the transactions would not call for council approval.

“Not only does this consequence in a deficiency of transparency to the Metropolis Council and the public, but it is wasteful simply because no tenant is likely to commit any considerable money advancements to a assets on which they only have 3 many years,” it explained.

The memo cites a modern system to lease a part of the Rancho Bernardo Leisure Area that was earlier rented to the Lake Hodges Bowl Club.

Personnel suggested a 10-yr deal dependent on advancements that would be needed on the internet site. But workforce reported Maus restricted the bidding to tenants who agreed to three a long time and limited in which the bid was promoted.

“This place, as lots of some others on city-owned residence, continues to be inactive and deserted,” the grievance claimed.

‘There are no files’

The grievance incorporates parts of a latest deposition Maus gave connected to litigation produced by the Ash Road debacle.

Under Faulconer, the city agreed to an “as-is” lease-to-have deal for the property with no conducting a home assessment. But the developing proved unsafe to occupy, and the lease spawned many lawsuits.

Last summer season, Gloria and the City Council agreed to spend off the entire value of the lease — a lot more than $100 million for a setting up that had been appraised at $67 million in 2016 but now, in accordance to the Mayor’s Place of work, is truly worth “virtually zero.”

In a deposition performed by attorney Michael Aguirre, Maus said she experienced study parts of the Ash Street lease but could not recall which pieces. “There are no documents similar to 101 Ash in my office,” she reported.

The new complaint in opposition to her also alleges that metropolis house brokers cannot obtain other critical files since Maus very last calendar year requested all information inputted into a new laptop system.

It claims Maus gave minimal way on how to put into action the improve and that documents that were being not moved would be deleted in six months.

“There is no central repository any longer for Read through information,” they wrote.

The staff reported Maus and Contreras proposed replacing existing software program for additional than $500,000 even although an enhance to the present method would be significantly much less high priced.

“It would make no sense to change the presently profitable true-estate monitoring application at a time when Read is so under-staffed and revenues are so important to the metropolis,” the criticism stated.

In 2021, Metropolis Auditor Andy Hanau issued a prolonged report criticizing a host of authentic estate offers past the Ash Road lease that had been designed beneath the previous mayor.

1 of the best recommendations was to develop a checklist to make certain that long term transactions had been carried out with complete due diligence.

In accordance to the grievance from genuine estate employees, Thompson proposed rewriting the council coverage for acquiring metropolis residence several years back — together with employing a checklist — but it was under no circumstances adopted.

“This proposed policy gets rid of the capability from the mayor and government group to drive Read through to convey an merchandise ahead without having adequately detailing the need to have or the threats to Town Council,” it stated.

The plan update “would empower town employees to current information to City Council that they need to have in purchase to vote.”

It continues to be unclear irrespective of whether the city auditor will pursue an investigation.