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Private investigators are making bank catching illegal Airbnb hosts

(BUSINESS NEWS) With rents sharply rising, it’s not hard to see why so many people are tempted to illegally rent out their spaces on Airbnb.

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private investigators airbnb

What’cha gonna do?

Risk versus reward: it’s the classic conundrum of the businessman. How much risk is acceptable, and how great are the rewards that can be realized?

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In large cities across the United States and around the globe, landlords are undertaking that calculus, even when it may run afoul of the law. The risks are that they will be caught violating local or state laws prohibiting the eviction of renters to turn what used to be a great apartment into the next hot Airbnb rental.

For other landlords, they gamble that no one will notice that they’ve bought up properties in desired locations around the city, routinely exceeding local restrictions on the number of nights that a property can be used as a short term rental.

Private eyes, they’re watching you

Landlords’ decisions to gamble on Airbnb legalities have created a new cottage industry: the real-estate private investigator. Private investigators are tasked to spy not on people, per se, but on property. Watching vacationers enter and leave a recently vacated apartment, investigators attempt to prove their plaintiffs were evicted illegally. San Francisco law prohibits evictions solely for the purpose of converting the property into a short-term rental, such as is common with Airbnb.

That such a case would manifest itself in San Francisco is not surprising. The city has become a flashpoint in discussions about gentrification and a lack of affordable housing in the city. With rents skyrocketing in recent years, the city has just now seen stabilization in market prices for one-bedroom apartment rentals.

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In 2016, rent prices in San Francisco actually dipped by 1.2 percent over 2015 rates. But with a median rent for a one-bedroom apartment in the city coming in at $3,343, it’s not hard to see why so many apartment owners would be tempted to convert their holding to a short-term rental sites like Airbnb.

For their part, Airbnb contends that they haven’t affected the housing market for those in the middle and lower income brackets. Instead, they point their fingers at local building restrictions that prevent new construction from starting, with increased demand coming from the lack of supply. However, they are taking steps to partner with local officials to ensure that they are complaint with local laws.

One host, one home

In November, Airbnb began a policy in San Francisco that established a “one host, one home” requirement. The purpose is to drive out investors looking to acquire apartments to turn into Airbnb rentals, rather than homeowners looking to supplement their incomes by leasing out their own property.

The same policy now exists in New York City, which has seen many of the same problems with the affordable housing market that San Francisco has seen. An economic impact study conducted in New York found that in Manhattan’s Soho/Greenwich Village neighborhoods, a short-term rental exceeds a longer rental’s value by nearly $10,000 annually.

“We strongly oppose illegal hotels and bad actors who remove housing from the market,” said company spokesman Nick Papas, speaking to Bloomberg. “We’ve removed thousands of listings from our platform that aren’t right for our community. We are committed to working with cities to address their specific needs.”

Private investigators now fill the gaps when Airbnb or local enforcement officials are unable to monitor rental compliance.

They are trying to provide protection to those who may be otherwise at the mercy of their landlords, turning what was once their homes into a trendy nightspot for tourists.

Unfortunately for renters, investigators are finding themselves in a lucrative market.

#AirBnBusted

Roger is a Staff Writer at The American Genius and holds two Master's degrees, one in Education Leadership and another in Leadership Studies. In his spare time away from researching leadership retention and communication styles, he loves to watch baseball, especially the Red Sox!

Business News

Bay Area co-living startup strands hundreds of renters at dire time

(BUSINESS NEWS) They’re blaming COVID for failing as a co-living space, but it looks like trouble was well established even before now.

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Person packed a bag and walking away from co-living space.

Over the last few years, “co-living” startups have become increasingly common in tech-rich cities like San Francisco. These companies lease large houses, then rent individual bedrooms for as much as $2,000 per month in hopes of attracting the young professionals who make up the tech industry. Many offer food, cleaning services, group activities, and hotel-quality accommodations to do so.

But the true value in co-living companies lies in their role as a third party: Smoothing over relations, providing hassle free income to homeowners and improved accountability to tenants… in theory, anyway. The reality has proved the opposite can just as easily be true.

In a September company email, Bay Area co-living startup HubHaus released a statement that claimed they were “unable to pay October rent” on their leased properties. Hubhaus also claimed to have “no funds available to pay any amounts that may be owed landlords, tenants, trade creditors, or contractors.”

This left hundreds of SF Bay Area renters scrambling to arrange shelter with little notice, with the start of a second major COVID-19 outbreak on the horizon.

HubHaus exhibited plenty of red flags leading up to this revelation. Employees complained of insufficient or late payment. The company stopped paying utilities during the spring, and they quietly discontinued cleaning services while tenants continued to pay for them.

Businesses like HubHaus charge prices that could rent a private home in most of the rest of the country, in exchange for a room in a house of 10 or more people. PodShare is a similar example: Another Bay Area-based co-living startup, whose offerings include “$1,200 bunk beds” in a shared, hostel-like environment.

As a former Bay Area resident, it’s hard not to be angry about these stories. But they have been the unfortunate reality since long before the pandemic. Many urbanites across the country cannot afford to opt out of a shared living situation, and these business models only exacerbate the race to the bottom of city living standards.

HubHaus capitalized on this situation and took advantage of their tenants, who were simply looking for an affordable place to live in a market where that’s increasingly hard to find.

They’ve tried to place the blame for their failure on COVID-19 — but all signs seem to indicate that they had it coming.

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Business News

Las Vegas’ largest dispensary gets massive Infinity Wall expansion

(BUSINESS NEWS) Las Vegas’s largest dispensary is getting a big, expensive makeover, thriving while other brick-and-mortar shops are struggling.

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Planet 13, Las Vegas's largest dispensary, set to get a huge expansion.

Have you ever heard of an Infinity Wall? If I were you, I’d check it out right now because it’s utterly mesmerizing.

An 80-foot version of this wall is just one of the new features that Planet 13 (or The Company) announced it will be implementing in Las Vegas’ largest dispensary, The SuperStore, this past Monday. In addition to the futuristic entertainment feature (I honestly can’t get over that thing), they will be doubling the sales floor and expanding the dispensary to ~23,000 sq. ft. For reference, the entire Planet 13 SuperStore complex is 112,000 sq.ft.

Why expand an already massive dispensary during a pandemic, when most brick and mortar stores are suffering? Well, according to Larry Scheffler, Co-CEO of Planet 13, The Superstore is actually thriving beyond belief.

“We are achieving record sales even with Las Vegas at ~50% tourist occupancy. As Las Vegas returns to normal and this industry continues to grow, we anticipate that this will be first of many expansions we will undertake to keep up with demand.”

The expansion adds 40 points of sale to uphold the outstanding customer service reputation Planet 13 has. If you do have to wait, you have a state-of-the-art entertainment system to enjoy. It’s win-win for any and all visitors.

The CapEx cost of the expansion between is $1.5 – $2.5 million. The project is expected come to completion by the end of Q1 2021.

Las Vegas has become a sort of cannabis mecca. After all, it’s home to MJBizCon, the industry’s largest networking event attended by thousands from around the world. And the popularity and overall acceptance makes it an easy choice for any cannabis aficionados. The SuperStore, like most things in Las Vegas, is huge, glamorous, and caters to tourists.

I have no doubt that when the city bounces back from the pandemic, this new-and-improved dispensary will be a must-visit destination.

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Business News

The future of work from home will be a hybrid, says Google CEO

(BUSINESS NEWS) Google is looking to adapt a more flexible, long-term hybrid work model for their employees, which includes partially working from home and partially being on-site.

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Work from home woman at a laptop.

Google, the world’s largest search engine company (yes I know they do other things), is positing that the corporate office will look completely different post-COVID-19.

In September Google’s CEO, Sundar Pichai said that the organization was making changes to its offices that would better support employees in the future. This includes “reconfiguring” office spaces to accommodate “on-sites”, days when employees who regularly work from home will come into the workplace. The move comes after Google was one of the first major tech companies to announce that employees could possibly work from home through next summer.

“I see the future as definitely being more flexible,” Pichai said during a video interview for Time 100, “We firmly believe that in-person, being together, having that sense of community, is super important for whenever you have to solve hard problems, you have to create something new,” he said. “So we don’t see that changing, so we don’t think the future is just 100% remote or something.”

It was reported that Google’s decision to work remotely into mid-2021 was originally in part to help employees whose children might be learning remotely during the coronavirus pandemic. Pichai said that several factors went into the decision, stating that improving productivity was a major concern.

“Early on as this started, I realized it was going to be a period of tremendous uncertainty, so we wanted to lean in and give certainty where we could,” Pichai said. “The reason we made the decision to do work from home until mid of next year is we realized people were trying hard to plan… and it was affecting productivity.”

Pichai also mentioned that the decision would help the firm embrace the reality that remote working wasn’t going anywhere once things returned to normal. A recent survey at Google found that 62% of employees felt they only need to be in the office on occasion, while 20% felt they didn’t need to be in the office whatsoever. While the work from home trend had already been growing over the past several years, the pandemic accelerated that movement greatly.

With housing costs surging in the San Francisco area, where Google headquarters resides, many employees have been forced to move outside of the city to afford a mortgage. This caused many to commute long hours into the office, something Pichai realized was a problem.

“It’s always made me wonder, when I see people commuting two hours and away from their families and friends, on a Friday, you realize they can’t have plans,” Pichai said. “So I think we can do better.”

It’s too early to tell whether or not Pichai’s vision of a “hybrid model” will be adopted by other companies when the pandemic ends. One thing is for certain though—work will never be what is pre-COVID-19.

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