Airbnb moved in, and there went my neighborhood
Crain’s Chicago Business | Samuel A. Lichtenfeld
May 11, 2016
“Nice place to visit, but I wouldn’t want to live there.”
You’ve heard the common refrain. But if Mayor Rahm Emanuel and some aldermen get their way, you may hear the same thing about your neighborhood.
They call Chicago a city of neighborhoods. Yet the Great American City is being invaded by the vacation rental industry, led by Airbnb. The City Council is considering an ordinance that would regulate Airbnb rentals here. You may live near such a rental. Chances are good you do not know the owner. Chances are good the city does not either.
The ordinance allows an unlimited number of short-term rentals, is light on background checks, provides weak penalties for violators and raises so little tax money from transactions that may occur illegally anyway that the revenue does not justify the destruction of our social fabric. I don’t oppose Airbnb categorically, but a better ordinance would limit the short-term rentals on a block and would require all non-owner-occupied units to have a license.
I live on a narrow one-block street with four entire buildings dedicated to short-term rentals. Though I respect the need for tourist accommodations, this outrageous penetration rate brings up to 50 strangers plus friends to my unprepared street on any given night. Instead of properly regulating this business, the ordinance on the table encourages its irresponsible growth.
More broadly, my neighborhood has over 600 such rentals, according to InsideAirbnb.com. Chicago has 5,147 listed rentals, and there are certainly hundreds more uncounted. In cities like Berlin (15,000), Toronto (6,000) and Madrid (7,000), entire neighborhoods are gutted with empty apartments waiting for perhaps a dozen people per unit to use citizens’ parking spaces, throw parties, litter and otherwise abuse a residential infrastructure not prepared or designed to deal with a booming hospitality industry. Is this the global city Mayor Emanuel aspires to make Chicago? A hollowed-out party strip?
These properties are turning my close-knit community into a high-traffic commercial zone, overrun with “tourists” with no stake in a neighborhood that Airbnb tells me provides visitors a “local experience.”
But this is no local experience. The owners of these rentals do not even live in Illinois. By renting these units, you do not enrich a neighborhood or pad the city’s coffers. You are paying an out-of-towner and his or her management company. Aldermen mutter vaguely about a surcharge of maybe $2 million annually to help the homeless. That won’t even cover lost property values when actual citizens leave town for their own “local experience,” tired of paying taxes for the privilege to provide it to strangers.
Which brings me back to our city of neighborhoods. Chicago is becoming harder to tolerate: increases in crime and taxes, difficulties with police-community relations, failing schools, insolvency in government departments and endless winters make me ask why I live here. Why raise my baby son here? I always return to the fact that I love my neighborhood. But if Airbnb continues to convert our residential streets into revenue centers for commercial endeavors, we won’t even have that.
Then they’ll say, “Nice place to visit, but no one lives there.”
Sam Lichtenfeld is a commercial real estate attorney who has lived in the Gold Coast for 14 years.