Proposal would increase fines for illegal conversions of residences into hotels. On December 3, 2007, the City Council’s Committee on Housing and Buildings held a public hearing on a proposal to increase fines on building owners who illegally convert residential units, especially rent-regulated ones, into hotel units.

Council Member Gail Brewer sponsored the proposal as a way to eliminate these illegal conversions, which she feels drain the limited housing supply, place additional pressure on the tight rental market, and deny permanent tenants the quiet enjoyment of their homes.

The proposal specifically prohibits the conversion of dwelling units classified as J-2 or J-3, which are intended for month-to-month or longer stays, to hotel units intended for day-to-day or week-to-week stays. Owners who illegally convert such dwelling units would be subject to the following fine schedule per unit: between $1,000 and $5,000 for a first-time offense, $2,500 and $5,000 for a second offense committed within an eighteen-month period, and $10,000 and $20,000 for a third or subsequent offense committed within an 18-month period. (more…)

Confusion existed in the closely held Limited Liability Corporation. In 2005, two tenants from 13 E. 17th Street filed a complaint with the Loft Board, claiming the building’s owner failed to install sprinklers as required and requesting fines. The tenants named Nathan Silverstein as the owner.

In Silverstein’s first letter to the Loft Board, he listed the correct owner as “13 E. 17 LLC,” but all remaining documents, including his formal response to the tenants’ charges, contained only Silverstein’s name. Silverstein then personally appeared at the OATH hearing. (more…)