‘Apartel’ operator exits L.A. amid citywide crackdown on short-term rentals

Ginosi Apartels built a niche around burgeoning vacation rental business

LA skyline (Credit: Wikipedia)
LA skyline (Credit: Wikipedia)

A company that built its business around the apartment-hotel rental concept will exit Los Angeles where short-term rentals are prohibited by the end of 2019, if not sooner.

Ginosi Apartels is among the most prominent companies to create a niche for renting out furnished apartments in the burgeoning business of vacation rentals in LA. apartment buildings. Housing advocates and neighborhood residents say that reduces the overall number of traditional rental apartments on the market, leading to higher prices, according to the Los Angeles Times, which first reported on the story.

The company, based in Armenia, has continued to operate more than three years after L.A. lawmakers promised to stop apartments from being run like hotels. Ginosi has touted its so-called apartels as a fusion between a hotel and “the conveniences of a fully furnished apartment.”

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While L.A.-area officials have tried to clamp down on short-term rental businesses, like Airbnb, courts have not always sided with them. A Superior Court judge in Venice Beach ruled earlier this year that nothing in city codes justified barring short-term rentals at an apartment building there. Vacation rental operators seized on the ruling as evidence to back their long-held assertion that L.A. had no law against short-term rentals.

In Santa Monica, officials have had more success of late in curbing short-term rentals by Airbnb, winning a court case in June.  But city officials have pointed to a recent study that showed only 187 of an estimated 950 short-term rentals from 2015 to 2017 were licensed with the city.

Ginosi has made inroads in other cities, advertising rentals in Chicago, Seattle and some European locations. It decided to end its operations in Washington, D.C., last year after the officials there sued, accusing Ginosi of working with building owners to illegally operate apartments like hotels. [LAT] — Alexei Barrionuevo