Concerns raised over rooming house revamp
Airbnb rentals putting pressure on affordable housing, critics say
For 30 years the boxy, Second Empirestyle building at 180 Sherbourne St. operated as a licensed rooming house for some of Toronto’s neediest residents.
Today, a vintage chandelier hangs in the ground-floor lobby. Nearby is a welcome sign, checkout policy and display rack filled with maps and brochures about local attractions.
Travellers looking for a bargain find their way to this property “in the heart of downtown Toronto” via online lodging site Airbnb, where host “Silvana” offers12 units starting at $34 for a “simple room with a single bed” to $100 a night for a room with two double beds.
Airbnb says its hosts are regular people sharing their homes for a bit of extra income with guests seeking an “authentic” travel experience.
Airbnb’s popularity has jumped dramatically in Toronto in the past two years, but critics say it is benefiting from a “sharing” myth — at the same time as it cuts into scarce available rental housing and creates unfair competition for the heavily regulated hospitality industry.
Airbnb guests staying at 180 Sherbourne, at the corner of Shuter St., are unlikely to meet owner Paul Iyogun, a business professor at Wilfrid Laurier University in Waterloo. In May 2015, PODA Holding Inc., of which he is the sole director, bought the building from a numbered Ontario company for $2.7 million.
Iyogun confirmed he does not live in Moss Park but in Milton, west of Toronto, in a home he does not offer to visitors through Airbnb. According to land registry documents, Iyogun and a partner paid $1.28 million for a 4,100-square-foot “luxury estate home” in Milton in 2012. It has awine cellar, a custom stone fireplace and a deck that “overlooks an oasis of gardens and trees in the rear yard.”
He said rooms at 180 Sherbourne are listed on Airbnb “as a means of advertising.”
“I don’t look at it as a hotel. It’s more or less a short-term stay for people,” he told the Star. “I believe we comply with the zoning bylaws.”
The building has an on-site superintendent, Silvana Manning, who lives there with her husband, he said.
Iyogun said he plans to apply for a rooming house licence and doesn’t rule out using Airbnb in the future to keep the property occupied.
“We have to find out what’s appropriate and what makes sense for us to do,” Iyogun said. He added later in an email that he is a “strong advocate for affordable housing.”
A spokesperson for Airbnb, Christopher Nulty, wrote in an email that absentee Airbnb “hosts” are the exception, not the rule. According to Airbnb, there are more than 15,000 hosts in the province, with 8,600 in Toronto.
“The vast majority of our host community in Toronto, more than 80 per cent, are sharing their primary residence — and are doing so a few nights each month to earn modest, supplemental income,” Nulty wrote.
Hosts made an average of $4,500 sharing their homes in Toronto through the site last year, the company said.
Nulty wrote that Airbnb has “not received any complaints from the city or local neighbours” about 180 Sherbourne.
A recent Canadian Centre for Policy Alternatives report concluded that close to 40 per cent of the city’s Airbnb hosts don’t live on site and run multiple units as “ghost hotels” in Toronto.
“That’s where Airbnb makes its money;180 Sherbourne is an obvious case in point,” Lis Pimentel, chair of the Fairbnb.ca Coalition, wrote in an email.
Pimentel, whose coalition includes property owners, affordable housing advocates, labour unions and representatives from the hospitality sector, said that if 180 Sherbourne “isn’t a massive zoning violation, then I don’t know what is.”
According to city planning staff, zoning bylaws do not allow a hotel in this part of town. The city defines a hotel as “premises used to cater to the needs of the travelling public by providing sleeping accommodation in rooms or suites.”
The city’s municipal licensing and standards division will investigate to determine whether there is a “nonpermitted use” happening at 180 Sherbourne, said Mark Sraga, director of investigations.
The city’s records show that 180 Sherbourne pays a residential tax rate, which is three or four times lower than a property zoned for commercial use, city officials say.
Kenn Hale, legal director of the Advocacy Centre for Tenants Ontario, said what troubles him about 180 Sherbourne is that it appeared to remove affordable housing intended for Toronto’s most vulnerable communities.
“Airbnb was sold as home-sharing. This is not home-sharing. This is converting a low-income residential property into hotel-like use and that’s not really acceptable,” Hale said.
Although the building was previously licensed as a rooming house, “in reality that wasn’t how it was used” and only two tenants lived there when he bought it last year, Iyogun said.
Fairbnb’s Pimentel said 180 Sherbourne and others like it are skirting existing rules and regulations, “many of which exclude hotel-type use in residential neighbourhoods and condominium buildings.
“This is now a hotel, even though it isn’t zoned as such and doesn’t pay commercial property taxes. I think we should all care when Airbnb and similar platforms take housing meant to help people and turn it into hotels,” Pimentel said.
This month, a city staff report to the mayor’s executive committee will identify “key issues related to shortterm rentals and (outline) a plan for how staff will conduct research on those issues — one of which is taxation,” Tammy Robbinson, a city spokesperson, wrote in an email.
Airbnb’s Nulty said company officials are collaborating with the city to develop fair, sensible home-sharing rules. “We believe we can partner with the city to address any unwelcome commercial operators,” Nulty wrote.