$21M rent rant
City sues real estate agents in Airbnb brawl
The city is accusing more than a dozen real estate agents of using Airbnb to unlawfully rent out rooms to thousands of guests, and it wants to get paid.
In a lawsuit filed Monday in Manhattan Supreme Court, the city alleges the Metropolitan Property brokerage firm used a shadowy network of shell companies to convert more than 100 Manhattan apartments into more profitable hotel rooms.
The city is demanding at least $21 million in damages.
Under state law, it’s illegal to let out units for under 30 days unless a resident is present during a guest renter’s stay.
“Over and over again, wellmeaning visitors are being misled by sophisticated businesspeople into booking illegal rentals,” said Christian Klossner, director of the Mayor’s Office of Special Enforcement. “Only with better data and cooperation from the booking websites can we efficiently identify and shut down these operations.”
The city’s lawsuit comes less than two weeks after a federal judge blocked a new city law requiring Airbnb and similar companies to hand over data about its listings and hosts to the city.
On Monday, a spokesman for the company chalked the rentals in question up to a “few bad actors” and the city’s failure to establish an “effective framework that allows for cooperation.”
“This case is a clear example of just one thing: the ongoing need for a comprehensive, statewide bill that would provide for strict recourse against the few bad actors while protecting the rights of thousands of regular New Yorkers who are responsibly sharing their home,” said Josh Meltzer, the company’s head of Northeast policy.
“Airbnb supports legislation in Albany that would do just that and we invite the Office of Special Enforcement to come to the table and work with us on a real path forward,” he added.
The company at the center of the lawsuit, the Metropolitan Property Group helped arrange more than 13,000 illegal rentals to more than 75,000 guests in East Harlem, Kips Bay and East Midtown, according to a city spokeswoman, who was referring to legal documents that had not yet been filed Monday.
The company and its brokers used misleading addresses to set up distinct Airbnb profiles, advertised false information about the properties and set up more than a dozen companies to rake in more than $21 million, the lawsuit claims.
Over four years — from 2014 to 2018 — MPG and their affiliates allegedly booked 4,600 illegal reservations spanning nearly 20,000 nights.
A lawyer for Metropolitan described the lawsuit as “sloppy” and “total garbage.”
“This casts aspersions on a company that had nothing to do with the illegal Airbnb rentals,” attorney Doug Pick said.