The owners will pay $185,000 in civil penalties and be barred from any short-term rentals of the Bernal Heights property for five years
SAN FRANCISCO (Nov. 20, 2018) — City Attorney Dennis Herrera announced today that he had reached a settlement with the owners of a house in Bernal Heights that was the scene of a wild shootout while in use as an illegal hotel. The owners, Erik M. Rogers and his wife, Anshu Singh, had unlawfully converted the single-family home into a two-unit building and then illegally rented it out for more than a year through online short-term rental sites Airbnb and HomeAway/VRBO.
As part of the settlement, the owners will pay $185,000 in civil penalties and be prohibited from any short-term rentals on the property for five years. The $185,000 figure effectively requires the couple to forfeit the $160,000 in ill-gotten gains they reaped from the unlawful rentals plus pay an additional $25,000 penalty. The money will be used to cover investigative costs and fund future enforcement. The settlement also requires the owners to bring the building into compliance with City planning and building codes within 180 days and abide by a strict injunction prohibiting similar unlawful behavior for the next 10 years.
“This outcome preserves one more house to help a family stay in San Francisco, and it makes the neighborhood safer for everyone,” Herrera said. “San Francisco’s short-term rental laws exist for a reason — so that our homes aren’t turned into illegal hotels. We cannot become a city that only has room for tourists and the wealthy. San Francisco’s short-term rental laws strike the right balance. They protect our neighborhoods and long-term housing supply while allowing people to occasionally rent out their home to help make ends meet when they’re out of town. These owners deliberately chose to break the law. They lied on their application, got caught, and went about illegally renting the property anyway. They exploited this housing crisis for profit, putting money ahead of their neighbors’ safety. Let me be crystal clear: if you try to game the system, we will catch you. Every time we shut down one of these illegal Airbnb rentals, it’s a win for San Francisco residents.”
“The shootout at an illegal Airbnb in Bernal Heights last year terrified and traumatized residents in my district,” Supervisor Hillary Ronen said. “For anyone thinking of disregarding San Francisco short-term rental regulations in the future, this judgment sends a clear message that we take these laws seriously and intend to enforce them to keep residential neighborhoods safe.”
Herrera sued in May 2018 after a City Attorney’s Office investigation found that between July 2016 and October 2017, the owners had unlawfully rented out 212 Banks St. as a short-term rental for at least 487 nights, charging nightly rates sometimes topping $700, while they lived in Bali, Indonesia.
During one of those short-term rentals in October 2017, guests hosted a wild party where fights among partiers devolved into a massive shootout. The gunfire sent dozens of partygoers fleeing through the neighborhood, running from rooftop to rooftop and trespassing through residents’ backyards. Police recovered more than 100 bullets and shell casings from the gunfight. Bullets pierced neighbors’ homes, damaging windows, doors and, in one house, the living room. Eighteen parked cars were damaged by gunfire. Miraculously, only one person was shot that night. The wound was not fatal. Approximately 10 weeks later, on Jan. 28, 2018, a neighbor found a discarded firearm in his rarely used backyard and accidentally discharged it, injuring his hand.
Herrera filed the lawsuit May 10, 2018 in San Francisco Superior Court against owners Rogers and Singh. According to the civil complaint, the couple violated state and local laws by renting out the property for tourist rentals, including engaging in unlawful business practices, creating a public nuisance and violating San Francisco’s short-term rental law. The couple also violated a host of building and planning codes by illegally converting the house from residential use to tourist use and chopping it into two units without permits, according to the lawsuit.
Short-Term Rental Rules
San Francisco requires, among other things, that anyone renting a housing unit for less than 30 days at a time register with the City’s Office of Short-Term Rentals and be a permanent resident of that unit — residing at least 275 nights per year in the unit. Even if you own or rent a multi-unit building, you may only rent out one unit for short-term rentals, and it must be the unit in which you live. Units cannot be rented out as short-term rentals for more than 90 days per calendar year. The rules are designed to prevent residential housing from being turned into de facto hotels, rather than used as long-term rentals for residents.
Rogers and Singh purchased 212 Banks St. on Oct. 22, 2010. Rogers and Singh have not used the property as their primary residence since at least 2013, and instead spend most of their time in Bali, Indonesia.
The couple used Airbnb and HomeAway/VRBO to rent the property for unlawful tourists stays from at least July 2016 through the end of October 2017. Roger and Singh maintained separate listings for the upstairs lawful dwelling unit and the main-floor illegal in-law unit, and would rent either or both units to tourists. Because the defendants are often in Bali, they hired and used other people to manage their unlawful rentals.
The couple also intentionally flouted San Francisco’s short-term rental registration and permitting requirements. Rogers submitted a permit application for 212 Banks St. to the City on Oct. 20, 2016 in which he stated under penalty of perjury that he resides in the unit for no less than 275 nights of any given calendar year. He also stated under penalty of perjury that he would maintain the property “in compliance with all applicable City codes.”
The Office of Short-Term Rentals denied Rogers’s application the next month after determining the property was not his primary residence, that he had failed to submit the required business registration certificate and that the property contained an illegal kitchen and dwelling room. Undeterred, Rogers and Singh continued to rent the property to tourists in violation of the law for at least 11 more months.
The case is: City and County of San Francisco and People of the State of California v. Erik M. Rogers et al., San Francisco Superior Court No. CGC-18-566441, filed May 10, 2018. More information can be found on the City Attorney’s website: sfcityattorney.org.