Hotel 17 has closed down

Hotel 17 at 225 East 17th Street (Photo by Sabina Mollot)

City says SRO building is running illegal hotel, but owner, fighting closure, says business is legit

By Sabina Mollot

Hotel 17, a budget hotel located in Stuyvesant Square, has stopped taking reservations and has been cleared of guests.

According to the general property manager of the business, Eyal Siri, this is not due to lack of business but due to the city’s crackdown on illegal hotels, which Siri said he’s been unfairly ensnared in.

Siri, whose family has leased and operated the hotel since the 1970s, admitted the business was never actually certified as a hotel, even though it has served that purpose openly for decades. According to the certificate of occupancy from 1943, it’s a Class A multi-dwelling/single room occupancy/old law tenement. In recent years, the city has had a task force investigate illegal hotels, which are usually residential buildings where rooms or apartments have been rented to people for under 30 days.

As of Monday, on the hotel’s website, a notice on the home page indicates the business is closed.

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Hostel bill aims to combat illegal short-term rentals

By Maria Rocha-Buschel

New legislation from a Queens Councilmember about hostels may provide residents weary of transients with some relief.

Councilman Mark Weprin introduced legislation this month that would legalize the construction, regulation and operation of licensed youth hostels in commercial districts throughout the city.

City Councilmember Margaret Chin, who represents the Lower East Side, is cosponsoring the legislation and said she hopes that hostels will take some of the pressure off of residential areas flooded with illegal rentals.

“Opening fully legal and licensed youth hostels will allow young people to enjoy the hostel experience without ending up in an illegal short-term rental, which can be unsafe and cause quality of life problems for residents of my Lower Manhattan district and all across the city,” she said.

The legislation would allow for the construction of hostels only in commercial areas, in order to prevent illegal hotel activity in residential areas already overwhelmed by temporary subletters.

The city does not presently have a law that legalizes youth hostels. Former Assemblyman Jerry Kremer, who is an advocate for youth hostels, explained that legislation passed by Governor David Patterson in 2010 eliminating Single Room Occupancy (SRO) entities had the downside of eliminating hostels.

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Mendez bill would make illegal hotels a form of tenant harassment

Councilmember Rose Mendez (Photo by Sabina Mollot)

Councilmember Rose Mendez (Photo by Sabina Mollot)

By Maria Rocha-Buschel

Councilmembers Rosie Mendez and Rory Lancman announced legislation last Thursday to crack down on tenant harassment from illegal hotel conversions.

“(Short-term renters) are coming in at all hours, bringing people they meet into the apartment and it’s then impacting the quality of life, in that there are strangers in their building,” Mendez said. “It’s a breach of peace and quiet in your home because of the noise and people traffic.”

She noted that in a hotel, guests can call down to the concierge if there’s noise in the hallways late at night and the hotel can take care of the problem.

But in an apartment building without a live-in super that’s been turned into an illegal hotel, the solution isn’t quite so simple.

“When tenants call the landlord, they’re not going to reach them at 2 a.m.,” she said. “And if it’s the owner who’s renting it out, they may not follow up with the complaint.”

Whether the noise is due to someone renting from a building tenant or the landlord, if the landlord does not address the problem, this legislation would make the act of illegally renting out apartments a form of harassment and would allow tenants to sue the landlord.

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Airbnb grilled at packed Council hearing

Stuyvesant Town tenants Arlene Dabreo and Marina Metalios were among hundreds protesting Airbnb outside City Hall before  a legnthy hearing attended by Airbnb execs, hosts who use the service, tenants and politicians. (Photo by Sabina Mollot)

Stuyvesant Town tenants Arlene Dabreo and Marina Metalios were among hundreds protesting Airbnb outside City Hall before a legnthy hearing attended by Airbnb execs, hosts who use the service, tenants and politicians. (Photo by Sabina Mollot)

By Sabina Mollot

Airbnb, the controversial home sharing listings site, was the subject of a lengthy and contentious hearing on Tuesday that consisted mainly of accusations being traded between politicians and the company’s director of global policy.

At the heart of the conversation was whether Airbnb was making efforts to comply with state law that forbids short-term rentals in most residential buildings, which the hearing’s chair, City Council Member Jumaane Williams, said he doubted. Meanwhile, Airbnb’s representative, David Hantman, threw in — at every chance he could get — a chance to defend Airbnb users who rent their homes out infrequently, who he said make up the bulk of the service’s users — and asked repeatedly why the law couldn’t be changed to exempt them. Instead, he argued, the law should just focus on “bad actors,” tenants or landlords who regularly rent apartments to tourists for short-term stays, making life hell for neighbors.

Most of the people in attendance were tenants opposed to Airbnb, due to illegal hotel activity in their own buildings, but there were also a few dozen supporters of the company, including hosts, with both groups demonstrating outside before the hearing. Those against the company carried signs with slogans like “I don’t want strangers for neighbors” and “sharing = selfish.”

A couple of demonstrators in that camp were Stuyvesant Town residents Arlene Dabreo and Marina Metalios.
Both said they’d seen suspected illegal activity in the community.

“We’ve seen it for sure, definitely in the past year,” said Metalios. “A lot of people coming in with suitcases and garbage being kept in the wrong place.”

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Also at the event was ST-PCV Tenants Association Chair Susan Steinberg, who’d hoped to speak about illegal hotel operations in Stuy Town, but finally gave up at around 5 p.m. since she had a meeting to go to. At this time the hearing, which began at around 11 a.m., was still going on. Since the City Council chambers were filled with around 200 people, some of them standing, the rest of the attendees, like Steinberg, had gotten herded into an overflow room.

Had she been able to give testimony, Steinberg said she would have focused on how, when residents’ use of Airbnb started to take off in 2011, it coincided with an uptick in bedbug infestations in Stuy Town buildings where short-term rentals were taking place. Following meetings with company reps alongside reps from CWCapital, illegal hotel activity in the complex has decreased, though it hasn’t ended completely.

Steinberg also had included in her testimony how the TA had heard concerns from neighbors about their safety when they challenged short-term renters who wanted to gain entry into buildings. In one case, an irate guest “just pushed their way into the building.”

One tenant who did get to testify at the hearing was West Side resident Audrey Smaltz, who said she’d lived in a penthouse apartment in her building since 1977, always feeling safe with the same neighbors for many years. But in recent years, this changed, with the owner renting vacant units as hotel rooms. “The entire fourth floor is for short-term rentals and (there are) many units on other floors,” she said.

As for Airbnb supporters, not too many had signed up to testify at the hearing, which Hantman had explained as being because they’re working people who can’t afford to wait around five hours.

“They have jobs; they have no voice right now,” he said.

However, politicians seemed less than sympathetic about the plight of New Yorkers resorting to home-sharing to help pay their own rent.

Council Member Corey Johnson, who represents Greenwich Village, said he lives in a tiny studio apartment for which “the rent is too damn high,” but added with what New Yorkers pay in rent, they should have the right to not be surrounded by transients.

Another Council Member, Robert Cornegy of Brooklyn, asked Airbnb for their revenue in 2014 and projected revenue for this year, which Hantman said he wouldn’t be allowed to provide. “I’ve got to FOIL that?” Cornegy asked him. “You’ve got to go to our finance people,” Hantman responded.

When questioned about how the attorney general had found that 72 percent of Airbnb rentals to be illegal, Hantman said this was “inaccurate,” especially since Airbnb has since removed thousands of listings by users who don’t provide a “quality” experience.

In response, Williams blasted Hantman for mentioning the word “quality” more than once when discussing hosts’ renting practices.

“You keep mentioning quality — you never once mention following the law,” said Williams. “I’m sure you have lobbyists that can try to change the law, but I don’t know how you can be a business person and never mention state or federal law. You only mention quality of experience. That’s not an effective business model in the City of New York.”

Hantman had argued that very few Airbnb rentals turned out negatively out of two million people using the service to stay in New York over the past few years. He also said 1400 of those people had found places to stay when they were impacted by Hurricane Sandy.

Council Member Helen Rosenthal, who represents the Upper West Side, asked about quality of life issues related to short-term rentals, when Hantman mentioned Airbnb has a neighbor hotline that can be called if a resident wants to report problems with an Airbnb guest or host. Rosenthal challenged this, asking “How would they know?” if a neighbor is in fact an Airbnb user as opposed to a client of some other home-sharing service or that the number even exists for the reporting of such issues.

When accused of putting tenants at risk for eviction for hosting, Hantman said the company does have a pop-up on its site for New York City users warning them hosting may not be legal in their buildings or allowed in their leases.

“We know how much they earn, but we don’t know what their lease is,” he said. “We ask our hosts to obey the law.”

One host there to support the company, Lee Thomas, told the panel about how after he became ill with cancer, his high-paying career on Wall Street came to an end and the only means he had of supporting himself was by renting out his getaway cottage. In response, Williams told him the illegal hotels law didn’t even apply to him because it applies to multi-family buildings while his property was just a two-family one.

Along with Airbnb, also getting quite a bit of criticism was the city office tasked with investigating illegal hotel activity, with Council members accusing its director of not doing enough or having the resources needed to adequately deal with the ongoing problem.

Elizabeth Glazer, the director of the Mayor’s Office of Criminal Justice, kept saying she believed her office was doing a good job at keeping up with complaints, but politicians countered that the system shouldn’t just be complaint-driven. Rather, Rosenthal said, it should be proactive enough to keep up with any suspicious short-term rental listing. This was after Glazer had said her office last year had received 1,050 illegal rental complaints, up from 712 in 2013. In response, Rosenthal told her there were over 2,000 listings in Council Member Antonio Reynoso’s district in Brooklyn alone.

“I publicly take issue with what you’re saying,” said Rosenthal.

When asked how the office investigates tips of illegal activity, Glazer said there is “an array of techniques that we use,” but she declined multiple times to say what they were.

This answer didn’t impress Council Member Peter Koo, who threw back, “I don’t see you using them though.”

He told Glazer about how he’d seen an inspector show up at an address where there was suspected illegal activity and knock once. When no one answered, the inspector knocked again. Then, after a few minutes more, when the door remained unanswered, he was gone.

“How come it’s so hard to open a door?” asked Koo. “Pretend you’re a tourist. Send a decoy. Tell them they’re here to give a massage.”

Despite getting some chuckles from the audience, Koo was then cut off by Williams. Koo said he represents an area in Flushing that’s become a “gateway of Asian tourism.”

Also sitting in at the hearing were the authors of the 2010 illegal hotels law, State Senator Liz Krueger and Assembly Member Richard Gottfried. Krueger said what she hoped would come out of the event would be more and not less enforcement of the law at the city level.

“Without enforcement at the local level, it’s as if we didn’t pass it,” she said.

According to Glazer, out of the 1,050 complaints received in 2014, 883 resulted in inspections and 495 violations being issued.

Council Member Dan Garodnick, who was not at the hearing since he is not a member of the housing committee, later said he does support “more aggressive enforcement” of the law.

Pols: Airbnb an illegal hotel operator

Borough President Gale Brewer, along with other elected officials including Assembly Member Richard Gottfried, Council Member Dan Garodnick, State Senator Brad Hoylman and State Senator Liz Krueger in front of City Hall (Photo by Sabina Mollot)

Borough President Gale Brewer, along with other elected officials including Assembly Member Richard Gottfried, Council Member Dan Garodnick, State Senator Brad Hoylman and State Senator Liz Krueger in front of City Hall (Photo by Sabina Mollot)

By Sabina Mollot

Last Friday, over a dozen elected officials and housing advocates gathered at City Hall to blast Airbnb, the home-sharing listing website that’s being investigated by the attorney general, as having become the city’s largest illegal hotel operator. The popular service, which allows users to list their apartments for short term stays, has become the bane of the hotel industry as well as a problem for some tenants, mainly due to safety issues when neighbors rent their apartments to strangers.

Then there’s the inevitable quality of life issues like late night noise and even bedbugs. Two years ago, when there was an uptick of bedbug sightings in Stuyvesant Town-Peter Cooper Village, Tenants Association John Marsh said he thought illegal hotel activity may have had something to do with it.

Meanwhile, in some properties, like ST/PCV, renting out one’s home for a bit of extra cash is not only against the law, but against the terms of the lease.

At City Hall, the speakers, following the formation of a coalition called Share Better, criticized Airbnb for not warning users that they may face eviction for renting out their homes. It was only after ST-PCV Tenants Association leaders as well as CWCapital employees met with representatives from Airbnb that the company agreed to send a pop-up message to would be Airbnb users with ST/PCV addresses that it would be illegal to rent their unit.

Susan Steinberg, chair of the ST-PCV Tenants Association, said this week that as a result of the warning message, she believes illegal apartment rentals are less of a problem today than they had been in recent years.

But they are still a problem.

“It’s just anecdotal things from people that it’s still going on,” said Steinberg. “People they’ve never seen lugging suitcases in and out.”

Additionally, on Monday, a Stuy Town apartment appeared in a listing by an Airbnb “host” named Damian, who was asking $304 a night for a two-bedroom apartment for a minimum of 14 days. The same user described himself in his bio as a manager of multiple apartments. The Stuy Town apartment was listed as a “Gramercy designer luxury suite.” The others available through the same host were in Soho, Nolita and Greenwich Village.

As for whether Airbnb is to blame for the other instances mentioned by Steinberg is hard to say, since there are other similar home-sharing service websites. One, called Flipkey, targeted ST/PCV residents in May of 2013 with a postcard mailed to each apartment that promised an average booking fee of $1,000.

This was swiftly responded to by management, however, who alerted residents via email that renting out their apartments was a no-no. “Please remember that apartment rentals for fewer than 30 days are prohibited under NYC law and use of this service is a violation of your lease and your tenancy,” CW told tenants. “Furthermore, short term rentals such as these are harmful to the PCVST community and negatively impact your neighbors.”

After that, a rep for Flipkey told T&V the company would not attempt to contact residents again.

Under the Illegal Hotels Law, passed in 2010, it’s illegal to rent out apartments in residential buildings for under 30 days. Airbnb has since fired back by lobbying to amend the law.

Tenants hold signs at a City Hall press conference.

Tenants hold signs at a City Hall press conference.

But while CWCapital has been attempting to stop the practice of short-term renting, tenants in other buildings said at the rally that in some cases it is owners themselves turning properties into illegal hotels. At City Hall, tenants, armed with signs that read “Homes not hotels” and “Save our homes” shared tales of landlords attempting to slowly turn their whole buildings into hotels because they earn more that way than through monthly rent.

A Hell’s Kitchen resident named Tom Kaylor said his landlord turned a one-bedroom apartment into a five-bedroom by packing in short-term guests. One of them turned out to be registered sex offender who threatened Kaylor’s nine-year-old son.

“We went to the NYPD,” he said. “We got him charged with making terroristic threats, but that didn’t stop the hostel.” In another incident at the building, Kaylor recalled how a Danish woman staying there had someone follow her inside and attack her. When neighbors heard her scream, they came out and her attacker, who’d left her with two black eyes, fled. “She didn’t want to make a police report because she was leaving the next day,” said Kaylor.

State Senator Liz Krueger, who authored the illegal hotels legislation along with Assembly Member Richard Gottfried, said she had tried to get it passed for seven years before it finally became law. “

Fundamentally what we have seen happen is a decrease in affordable housing in the city,” said Krueger, “as these apartments are taken off the market to be used in illegal hotel activities.”

She and other politicians then took jabs at Airbnb’s recent marketing blitz, with different ads depicting New Yorkers along with their guests in their apartments and sharing stories of how renting out their homes helps them afford their own expensive rent. But, pols said, the ads are misleading because most hosts aren’t home while their guests are, which is what makes the transaction illegal.

“It’s very misleading — renting to tourists to make ends meet,” added Council Member Dan Garodnick. “That would be very sympathetic, if it was a complete picture.”

Gottfried noted that regular hotels have to abide by very specific fire and safety codes. “Illegal hotels almost always violate these safety codes,” he said.

Borough President Gale Brewer said she thought Airbnb “is a problem,” though she added that the city does need more low-cost hotels. “This administration needs to look at quality hotels that are legal. That’s what we should focus on,” she said.

Other politicians to criticize Airbnb as making the affordable housing crisis worse were Council Members Corey Johnson, Rory Lancman, Mark Levine and Helen Rosenthal, State Senators Brad Hoylman and Adriano Espaillat, Assembly Members Walter Mosley and Linda Rosenthal and Public Advocate Tish James.

The event was also in promotion of the Share Better coalition, which seems to have been created with the sole purpose of opposing Airbnb. The coalition, as well as Attorney General Eric Scheiderman believe two thirds of the company’s income comes from illegal hotels. After subpoenaing anonymous information about the company’s users, the A.G. asked for identifiable information about 124 users who allegedly are each renting out a minimum of 10 apartments. Seventeen of those users have since sued to block their personal information being turned over so the A.G. currently has the identities of the remaining 107.

A spokesperson for Airbnb, Nick Papas, when asked about the rally and criticism of its business practices, issued this statement.

“We strongly oppose illegal hotels and have advocated for legislation that would modify the law to make it easier for regular people to share their primary residence.” He also referred to information on a recent post on the company blog.

In it, Airbnb insisted that its 25,000 listings were too small of a number to have a negative impact on the pricing of New York City’s three million households. The company also said that it recently removed a number of users who were “abusing” its system by offering multiple listings and not providing a “quality, local” experience for guests. It also blamed the current backlash against its services on the hotel industry.

“Some in the hotel industry will do everything they can to stop the sharing economy,” the post read, “but we look forward to working with leaders in New York on sensible legislation that cracks down on illegal hotels and ensures regular New Yorkers can share the home in which they live.”

On Friday afternoon, when talking to reporters, Mayor Bill de Blasio promised there would be “more enforcement” on the issue. “We have been increasing enforcement and you’ll see more enforcement as we go along,” he said. “There’s difference types of realities, obviously, under the rubric of Airbnb the sharing economy, and some of them are things to embrace and some are examples where some individuals get outside the law and we’re obviously going to follow up on that very aggressively.

“We also need a bigger set of policies to address these changes in our society – you know, the role of technology and commerce – and we intend to do that. But you’re certainly going to see – if you look at the numbers so far, there’s been a lot of enforcement already this year. You’re certainly going to see more.”

Airbnb won’t cooperate with A.G. investigation

State Senator Liz Krueger authored an illegal hotels law.

State Senator Liz Krueger authored an illegal hotels law.

By Sabina Mollot

Airbnb, a company that reps from the ST-PCV Tenants Association and property management have met with in an attempt to keep tenants from illegally renting out their homes to strangers for short-term stays, is now refusing to cooperate with an investigation by the attorney general.

In an official statement on its website, Airbnb had this to say in response to news reports about the investigation, which seeks to subpoena information about the company’s users.

“We always want to work with governments to make the Airbnb community stronger, but at this point, this demand is unreasonably broad and we will fight it with everything we’ve got,” the company wrote in a blog post. The statement went on to say that its “host” users were “everyday New Yorkers who occasionally share the home in which they live.”

The statement comes on the heels of a court victory for Airbnb, in which it was successfully able to argue that an East Village resident who used its service to rent out his apartment didn’t break any laws because a tenant of record was at home during the time a paying guest stayed there.

Meanwhile, a spokesperson for Attorney General Eric Schneiderman did not respond to a request for comment on the investigation, which was first reported in Crain’s.

Airbnb, however, also said it would “continue conversations” with the A.G. to “to see if we can work together to support Airbnb hosts and remove bad actors from the Airbnb platform. We are confident we can reach a solution that protects your personal information and cracks down on people who abuse the system.”

Despite the encouraging promise, Airbnb’s response when it comes to illegal hosting has been noncommittal in the past, at least where ST/PCV is concerned. ST-PCV Tenants Association President John Marsh had previously asked that he company no longer allow any postings that involve any of the property’s 110 addresses.

A spokesperson for Airbnb offered to answer T&V’s questions, but then didn’t respond when asked if any policy was changed in regards to ST/PCV, where a couple of years ago, management had to crackdown on widespread short-term hosting. Some room-and-board arrangements were made by other sites like Craig’s List and Roomorama, but mainly listings for short-term rentals were found on Airbnb.

The problem does appear to have subsided since then though. This week, a scroll through the site only revealed a few listings for apartments that were obviously located in ST/PCV apartments, and they included one request for a long-term guest as well as a couple of listings offering a room rather than the entire apartment.

A spokesperson for CWCapital did not respond to a question about how management’s investigation into illegal hotel activity was going, but Marsh said CW had last left the TA with the impression that it was continuing to pursue offenders. Marsh also said the TA hadn’t gotten any recent complaints abut illegal hotel activity.

It was in 2010 when a law, authored by State Senator Liz Krueger, was passed that made it illegal for apartments in most types of residential buildings to be rented out for stays shorter than 30 days.

Following Airbnb’s recent court win, Krueger responded to the company’s claim that it would work to weed out those who abuse its system that matches travelers with apartments, rather than hotels to stay in.

“One easy way for them to help is to specifically explain the state and city laws relating to this activity on their website,” she said in an official statement, “and have clear guidelines pop up as a splash page whenever a host is listing a unit in New York City or a guest is looking at NYC listings. After all, a tenant may see this as an easy way to make some fast cash, and clearly Airbnb is taking a cut, but the building owner has rights too and faces most of the liability if things go wrong.”

She added that if “Airbnb wants to remove bad actors, they should require their hosts to provide addresses and apartment numbers. Making clear what is and is not legal in a community is the best way to ensure fewer people will unknowingly break the law, risking eviction from their homes and/or fines from the government.”

Krueger spokesperson Andrew Goldston added that while the law was intended to weed out the worst of the offenders, those who have made illegal hotels a business rather than an occasional way to earn cash, any bookings at all are still illegal in many buildings and the feeling of the senator is that Airbnb “is trying to draw a broad line that’s very convenient for them.”