Pacaso to leave Bel Aire neighborhood, implement new operations policies

Pacaso purchased the three-bed, two bath home at 1627 Rainier Ave. in Napa’s Bel Aire neighborhood for $1.13 million in April of 2020. Shortly thereafter, the sale caught the attention of the property’s neighbors, who voiced their displeasure at not having been warned about the company’s purchase and concern over the company’s fractional home ownership model.

“Our neighborhood is wrong for this,” Pattie Dullea, whose home sits across the street from 1627 Rainier, told the Register in early May. “We have to preserve our little neighborhoods in Napa – there’s teachers, policemen and electricians here. It is a wonderful, varied neighborhood… that should not be able to be in the market for fractional ownership.”

After community backlash – including organized protests held by neighbors – the company announced Wednesday afternoon it would resell the home it had purchased on Rainier to “a whole home buyer.” In the same press release, company announced it would implement a litany of policy changes, including that of a price floor, only purchasing homes listed at $2 million or more in Napa and Sonoma counties; an expansion of its owner code of conduct to include decibel limits on all home sound systems; the creation of local neighborhood liaisons, a “dedicated point of contact” available to assist neighbors of Pacaso properties; and an ongoing donation program to support local affordable housing nonprofits. Pacaso will donate $2,500 for each 1/8 ownership share sold per property, according to the release.

Shares of the home on Rainier had previously been listed on Zillow for $184,000 each, the Register reported in May. Pacaso’s stated mission is to “democratize second homeownership,” the company has said. It purchases homes – mostly luxury properties, CEO Austin Allison previously told the Register - and then offers the property up for resale, split into eight shares.

Pacaso previously announced in May it was pausing sales of the Rainier property to reassess its next steps after vocal opposition from neighbors. At its purchase price of $1.13 million, the home was just 6.5% over Napa County’s median home price in the month of March, when it was listed. Pacaso typically purchases properties anywhere between 200% and 400% of the median price point in any given area, Allison told the Register in May; the Rainier property was “on the low end” of his company’s portfolio, he added.

In a response via text on Wednesday, Dullea said she and her neighbors were “looking forward to welcoming a ‘whole home buyer’ to the Rainier neighborhood” but said the sale of the home at 1627 Rainier Ave. was “just a beginning.”

“…We encourage and advocate that whatever internal policy changes Pacaso actually makes moving forward must take all Wine Valley neighborhoods into consideration, not the price of the properties,” she wrote. “Multiple homes in St. Helena and Sonoma are currently on the market or being prepped for sale by Pacaso… these neighborhoods are every bit as precious to those cities as ours (is to Napa). Prices there are higher than $2 million, but it’s not about the money.”

Dullea and her neighbors had worked to form a group called the Wine Valley Alliance, which would include residents of neighborhoods in Sonoma. The group will continue to “meet, network, petition, communicate and remain vigilant whenever we see any homes in any valley neighborhoods being purchased” and resold to fractional owners, she added.

A Pacaso spokesperson acknowledged opposition to the company’s fractional homeownership model but added there were “plenty of neighbors” who had been supportive of the startup and its model.

“Nobody wins when homes sit empty,” Ellen Haberle, the company’s director of government and community relations, said in the press release. “We look forward to working together to help the community thrive over the long term.”