Penthouse tenant gamed eviction moratorium, short-term rental ban: lawsuit

Invesco trying to oust deadbeat from $8K-a-month apartment in Hell’s Kitchen

Invesco's Marty Flanagan and 550 West 54th Street (Illustration by Kevin Cifuentes for The Real Deal with Getty Images, Invesco, Douglas Elliman)
Invesco's Marty Flanagan and 550 West 54th Street (Illustration by Kevin Cifuentes for The Real Deal with Getty Images, Invesco, Douglas Elliman)

Invesco is moving to evict a Hell’s Kitchen tenant who allegedly exploited loopholes in New York law to skip rent for nearly two years while reaping $1,000 a night by putting his rent-regulated apartment on Vrbo.

Building managers filed a lawsuit against the Mercedes House tenant, Jude Onicha, accusing him of the short-term rental scheme, Crain’s reported. Onicha lives in an $8,000-a-month penthouse at 550 West 54th Street, but hasn’t paid rent since February 2020, according to the suit.

Since that time, tenants have been able to stay in their apartments without paying rent because of a statewide eviction moratorium and a rental aid program.

The moratorium ended Jan. 15, 2022, but tenants who applied to the state’s Emergency Rental Assistance Program, as Onicha did, maintained their eviction protection while the application was pending, even after the program ran out of money.

While the landlord tries to get Onicha out, the property manager is asking a judge to stop Onicha from illegally renting out his place. Under state law, a home cannot be rented out for fewer than 30 days unless a permanent resident is present. Short-term rentals are also a violation of standard apartment leases.

Sign Up for the undefined Newsletter

Read more

Onicha claimed in court documents that he spent months applying for rent relief and that he is trying to pay his debts, according to Crain’s.

Onicha’s two-bedroom, two-bathroom apartment was listed on Vrbo, where it was described as “paradise on Earth.” Mercedes House, which opened in 2011, is an 850-unit building co-owned by Two Trees Management.

The lawsuit comes as New York continues to battle illegal short-term rentals. In 2016, the state banned the advertisement of illegal short-term rentals. Enforcement of the laws has proven challenging, though, and largely focuses on landlords, who have objected to being punished for their tenants’ misdeeds.

Last month, federal prosecutors charged Konrad Bicher — the self-proclaimed “Wolf of Airbnb” — with wire fraud and identity theft, for which Bicher planned to plead not guilty. Prosecutors say Bicher ran a scheme from 2019 to this year, signing a dozen-and-a-half leases and collecting more than $1 million while avoiding about the same amount in rent payments.

— Holden Walter-Warner