March 11, 2016
Two City Council members have some investing advice for the financiers and celebrities backing Airbnb: get out.
Citing increased funding for inspectors and mounting evictions of illegal renters, the pols warned in a letter that regulation “could impact the value of your investment.”
Helen Rosenthal, D-Manhattan, and Jumaane Williams, D-Brooklyn, sent their note Wednesday to more than 30 investors, including firms Fidelity, Sequoia Capital and T. Rowe Price, the actor Ashton Kutcher and Amazon founder Jeff Bezos.
“For our part, if we were invested in a company that knowingly engaged in so much illegal activity, we would think twice about keeping our money in that company,” the lawmakers wrote.
State law forbids apartments from being rented for fewer than 30 days unless the primary occupant is also living there. But enforcement of the law in New York has been somewhere between sporadic and nonexistent, and in any event, Airbnb business is largely beyond the council’s reach. The company has about 1.5 million listings in 34,000 cities and 190 countries.
Unlike fellow tech disruptor Uber, Airbnb has faced steely opposition from local politicians who claim it exacerbates the city’s housing crisis. The council will soon pass legislation to increase fines for New Yorkers caught posting their apartment for an illegal rental, the letter warns.
Through a spokesman, Airbnb fired back.
“Most lawmakers are having a serious conversation about how to regulate home sharing responsibly in New York, but some are focused on theatrics,” he said. “Council Members Williams and Rosenthal are clearly committed to punishing middle-class New Yorkers who simply want to share the home in which they live in order to make ends meet.”