LOS ANGELES – Seeking to preserve much-needed affordable housing, City Attorney Mike Feuer is taking action against the owners of four properties for allegedly unlawfully converting and operating rent stabilized apartment buildings as short-term rentals or hotels.
“In a city with a profound shortage of affordable housing, unlawfully converting rental units to operate hotels has got to stop,” said Feuer. “My office will continue to intervene to keep rent-stabilized units on the market and hold owners accountable for not complying with the law.”
The City Attorney filed civil cases against the owners and operators of three apartment buildings each subject to the City’s Rent Stabilization Ordinance (RSO), alleging that the property owners are illegally operating and advertising as hotels. The lawsuits seek a court appointed receiver to operate the properties until they are brought into compliance, as well as restitution and significant civil penalties.
Carl Lambert, the owner of Venice Suites (417 Ocean Front Walk), allegedly has operated and advertised the 32-unit apartment building in Venice as a hotel complete with its own website and regular hotel amenities. In January, 2015, the Department of Housing and Community Development (“HCIDLA”) issued Orders to Comply to discontinue use as a hotel. Those orders allegedly continue to be ignored by the defendant.
William Andrew Layman, Rose Layman and Matthew Moore, the owners and managers of Venice Beach Suites (1305 Ocean Front Walk), allegedly operate the 30-unit apartment building as a hotel, extensively using internet sites to advertise the apartment units as hotel rooms for reservations, though the zoning for the location does not allow for its current use. In January 2015, HCIDLA issued Orders to Comply to the property owners citing the illegal use as a hotel. Those orders allegedly continue to be ignored by the defendants.
George Panoussis owns a 59-unit apartment building (830 N. Van Ness Avenue) allegedly operating and advertising as the Hollywood Dream Suites Hotel in direct violation of the area’s residential zoning requirements. Panoussis and his co-defendants allegedly have denied inspectors access to the premises at least eight times. In January, 2014, HCIDLA issued Orders to Comply to the property owner for illegally using the property as a hotel without proper permits from the Department of Building and Safety. Those orders allegedly continue to be ignored by the defendants.
At a fourth property, Carol Jean Alsman, the owner of a 4-unit property located at 500 N. Genesee Avenue, was charged with six counts in a criminal case alleging: failure to comply with an Order to Comply, zoning violations; illegal use without proper building permits, failure to file notice of intention to re-rent, failure to offer rental to displaced tenants, and renting property within five years after withdrawing from the rental market under the Ellis Act.
The complaint alleges Alsman applied under the Ellis Act to remove her rent-controlled property from the rental market and complied with all regulations to have tenants compensated and relocated. However, Alsman allegedly began renting those units shortly thereafter through Airbnb and failed to allow former tenants an opportunity to re-rent those units, in direct violation of the provisions of the Los Angeles Municipal Code.
The City Attorney will be sending a list of Ellis Act properties to Airbnb and other short-term rental platforms as a preemptive measure to prevent listing of similar properties.
Assistant City Attorney Tina Hess and Deputy City Attorney Andrew Wong are handling the litigation.