Historic Airbnb-condo deal makes it a hotel: critics
Airbnb announces new deal with downtown Toronto condo that critics say turns it into a hotel.

TheStar.com
Oct. 25, 2017
Betsy Powell

Airbnb is calling its new partnership with a Toronto condominium a milestone arrangement that is designed to improve the short-term rental market experience in the building near the city’s waterfront.

But critics are crying foul, suggesting Airbnb’s deal with the board at Neptune Waterpark Condominiums (209 and 215 Fort York Rd.) is further proof Airbnb is in the business of turning residential developments into hotels.

“Countless studies have shown that short-term rental services like Airbnb make cities even more expensive to live in by reducing long-term rental stock,” said Thorben Wieditz, of the Fairbnb, a coalition started by a union representing hospitality workers.

Buildings such as Neptune condos were designed, zoned, approved, and built to be residential condos, not hotels, he added.

“Hotels have different zoning laws, design needs, safety requirements, regulatory obligations, and tax burdens than residential condos. If Airbnb and the Neptune condo board want to be in the hotel business, they should follow the same rules as the regulated hotel industry.”

Under the arrangement with Neptune, Airbnb will provide its hosts with primary property insurance up to $1 million and extend liability insurance — also up to $1 million — to cover the building’s common areas.

The building will also have its own online portal showing short-term rental activity, including a record of how many guests are staying in a unit and when they are checking in or out.

And Airbnb will help establish rules, such as those relating to parking and pets. The building will receive a cut of each booking, anywhere between 5 and 15 per cent, an Airbnb news release said.

The agreement under Airbnb’s Friendly Buildings Program is the first in Canada and outside the United States, said Aaron Zifkin, regional director for Airbnb in North America.

It also comes just as the city of Toronto moves ahead with plans to licence and regulate short-term rentals, limiting them to a person’s principal residence.

“We’ve been working with buildings … and just really trying to understand what the opportunities are,” Zifkin said Wednesday. “We think that with this new program we’re going to really increase our involvement with these buildings.”

Airbnb, which has listings for properties in 63,000 cities around the world, has struck similar deals with buildings in Jersey City, San Jose, and Kissimee, Florida.

Nick Bednarz, owner/resident and vice-president of the Neptune Condo board, rejected the characterization that the Airbnb deal turns the property into a hotel. It goes into effect Nov. 1.

“Short-term rentals have been allowed and been in place since the building was constructed,” he wrote in email. “This doesn’t change that, it puts a framework in place whereby we now have some controls to better manage the situation.”

Renters live in 75 per cent of the complex’s 871 units while the rest are owner occupied. Bednarz said Airbnb told him 80 units have appeared on the platform.

At a town hall meeting, building residents — both renters and owners — complained about noise and cleaning issues due to the high volume of traffic, though “both equally apply to standard rentals,” and Airbnb, he wrote.

As a result, the board initially sought to ban short-term rentals but that vote, requiring 80 per cent of owner support, failed.

About 100 owners attending an annual general meeting made it “very clear” they preferred the status quo allowing short-term rentals, leading the board to work directly with Airbnb, Bednarz said. The five-member board unanimously voted in favor of the deal.

At city hall on Wednesday, Mayor John Tory said he had some concerns about the Airbnb/Neptune deal, including the impact it has on the supply of housing for permanent residents.

“We need every available housing unit to be available to people who are going to live in them, as opposed to staying in them on a transient basis or having them as hotel rooms or leaving them empty.”