Targeted by activists and the city, Venice Beach Suites can no longer operate as a short-term rental hotel

By Gary Walker

Venice Beach Suites (center) must now lease to longer-term tenants

A city-designated historic-cultural monument that became a popular short-term vacation rental destination on the Venice Boardwalk is now leasing studio apartments to longer-term tenants, following an L.A. City Attorney’s office crackdown on property owners accused of illegally converting rental housing into Airbnb-style hotels.

In a court settlement announced late last month, Venice Beach Suites owner Andy Layman agreed to cease operating and advertising the four-story building south of Westminster Avenue as a short-term rental property or hotel and pay $200,000 in civil penalties.

Layman also agreed to lease 25 of the 1912 building’s 30 refurbished studio apartments (five of which already had long-term occupants) for no less than one month at a time — and at 2012 market rates over the next calendar year.

Venice Beach Suites is subsequently offering prime beachfront studio apartments with access to a rooftop patio for $2,180 to $3,550 per month, according to its website.

In 2016 L.A. City Attorney Mike Feuer filed suit against multiple hotel operators in Venice and Hollywood, accusing them of illegally taking apartment buildings off the rental market to convert them into much more lucrative short-term vacation rental hotels.

Community activists calling for stricter regulation of short-term rentals blamed Layman and others for exacerbating the city’s housing affordability crisis by taking long-term rental housing off the market, which is now specifically prohibited under the city’s home-sharing ordinance approved in November.

Layman thinks political pressure to regulate short-term rentals — especially from Venice — was a motivating factor in the city attorney’s prosecutions.

“I think that the city was trying to use me as an example,” he said.

Of his decision to abide by the settlement, “We determined that the city has a bigger checkbook than we did,” he added wryly.

Feuer’s office had also prosecuted Venice Suites owner Carl Lambert, past president of the Venice Chamber of Commerce, accusing him of illegally taking the historic Venice Boardwalk property between Dudley and Paloma avenues off the rental market in order to accommodate short-term rentals.

But Lambert fought the city in court, armed with a city-granted certificate of occupancy for an “apartment-hotel,” and won the right to continue operating as a hotel.

“I found that very interesting,” Layman said of the ruling in favor of Lambert. “Our building was originally built as a visitor-serving accommodation.”

Despite Venice Beach Suites’ origins as a hotel 107 years ago, the city’s settlement with Layman states as “undisputed facts” that the building is an “apartment house subject to the RSO [Rent Stabilization Ordinance]” that had been functioning as an unpermitted hotel for approximately 16 years.

Feuer says his enforcement action against Layman is about keeping rental housing available to residents.

“My office will do everything we can to protect L.A.’s scarce stock of affordable housing,” reads a statement by Feuer.

In addition to Layman, Feuer has also prosecuted Hollywood landlords Carol Jean Alsman, whose case is still pending, and George Panoussis, who is appealing a 2018 civil court ruling in the city’s favor.