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Housing Advocates Say DTLA Apartment Building Being Operated as Hotel

In a high-rent city with a growing homeless problem and a need for hundreds of thousands of new units, a downtown apartment building is essentially off-limits to renters, according to labor and housing advocates.

They allege a downtown building advertised as "Level Furnished Living" is operating as a hotel or "extended stay," Airbnb-style short-term rental in violation of city law. Organizations led by hotel workers union UNITE Here Local 11 have sent a "request to investigate" the situation to Vincent Bertoni, director of the City Planning Department. The request was signed by a number of housing advocates, including Larry Gross, executive director of the Coalition for Economic Survival.

The 303-unit building is operated by Vancouver-based developer Onni Group, which says it has full permission from the city to run the complex this way. Its website offers immediate booking unless customers are seeking "30+ nights" of accommodation, in which case they're invited to inquire about terms.

"Onni Group’s Level Furnished Living property located at 888 S. Olive St. is an extended-stay apartment building with various length lease terms," Mark Spector, the firm's senior development manager, said via email. "This use is permitted under the zoning."

The investigation request argues that city approvals — issued in 2009, 2010, 2012 and 2014 for the mixed-use structure, its parking and blueprints — all describe the development as "residential." The approvals cited the "growing demand for housing," according to the letter. If the structure was anything other than residential, labor and housing advocates say, it would have had to have been green-lit as a hotel and pay city hotel taxes. Even Airbnb has agreed to pay city hotel taxes.

Spector of Onni indicated that the rules are flexible and that the city is working on a final determination regarding the building's short-term stays. "Earlier this year we received notice from the city regarding the flexible apartment lease length at Level and worked with the city to clear up the ambiguity around transient occupancy residential structures, which are a permitted use downtown," he said.

"Onni took further steps and to be abundantly conservative obtained a transient occupancy residential permit for the building," he added. "The minor work associated with this clarification permit will be completed in two weeks."

We reached out to a spokeswoman for the planning department but have not received a response.

Cynthia Strathmann, executive director of Strategic Actions for a Just Economy (SAJE), who also signed the investigation request, argues the building is one of many that's helping to exacerbate the city's housing crisis, which has been fueled by high rents and low vacancy rates.

"SAGE is very concerned about removing housing stock from the market and turning it into other kinds of products," she says. "Housing pressure is coming in part from low inventory."

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