Tenants complain about spike in short-term ‘party’ rentals at failed Dundurn condo project
A luxury apartment building caught up in lawsuits over a failed condo conversion is now losing tenants who complain about a spike in short-term party" rentals.
Five years ago, developer Denis Vranich converted the former National Hosiery Mills at 220 Dundurn St. S. into an upscale, 124-unit apartment complex.
But things went awry after mortgage woes and a 2019 condo conversion gone wrong triggered $8 million in ongoing lawsuits against Vranich and associated companies. The three-storey brick building has since changed owners and property managers twice, with the condo units - all owned now by one corporation - used as rentals.
Ben Ruffett didn't know any of that history when he signed a $2,200-a-month lease in July 2020 and moved into an impressive, well-maintained" third-floor loft that he loved - at first.
But by early this year, Ruffett said a spike in apparent vacation rentals turned his floor into a grimy hotel" that attracted late night parties, package thieves and an influx of maskless visitors that made him feel unsafe during COVID.
We were kind of at the height of the pandemic and (there were) just so many people coming and going, no one wearing masks, noise all night long," said Ruffett, who complained to police and bylaw about competing parties on his floor one night in March. I think on my floor, there must have been six or seven (short-term rentals)."
Ruffett gave up and moved out before the end of his one-year lease, but left some furniture and small belongings behind, intending to pick them up later. When he returned for them in May, he said the unit had been emptied." So far, Ruffett said no one has responded to his requests for a refund or explanation.
Other recent tenants reached by The Spectator reported a range of complaints. Unreturned key deposits worth $500. Requested repairs that never happened. Complaints and calls that went unheeded.
But the most common theme was frustration with a perceived jump in short-term rentals - a trend tenant advocates also call worrisome given the city's ongoing housing crisis.
The Spectator reached out with questions about tenant complaints to a recent property manager as well as John Budworth, who is listed in corporate records as the president of SOD Management Inc., which now owns the building condo units. They declined through a lawyer to be interviewed or answer emailed questions.
A lawyer for Vranich said he no longer has an ownership interest in the building. The developer filed a statement of defence in April denying claims of breach of contract from would-be condo buyers who launched a lawsuit last year after their planned unit purchases were cancelled. None of the claims have been tested in court.
While the province restricted vacation rentals during parts of two emergency pandemic lockdowns, short-term rentals were still allowed for individuals in need of housing."
At the moment, between seven and 12 units in the building are visible on vacation rental sites like Airbnb and Booking.com.
But it is difficult to tally exactly how many Dundurn Loft units were used as short-term rentals during the latest lockdown - or even whether they were made available by the condo owner or subleased by tenants.
The city bylaw department says it has fielded 13 complaints during the pandemic at Dundurn Lofts, with most related to alleged noise or COVID violations like large gatherings and maskless visitors.
Former tenant Claire Chen said COVID party time" started last year and sometimes left a first-floor garbage room overflowing with trash, a complaint echoed by Ruffett on the third floor. Think stacks of pizza boxes. Cases of beer. Broken bottles. Partially eaten food.
That's why I moved out. I just can't live there anymore," said Chen, who left late last year but said she is still chasing a $500 key deposit from property managers who won't return calls. You could see flies (in the trash room), it just smelled so bad."
Melissa Jeffreys' lease does not end until later this month, but she's already effectively moved out.
She said she decided to bail on the building after absent" property managers refused to deal with ongoing repair woes and pandemic party hassles.
They started renting out the rooms there like hotel rooms ... so there were all these young people just roaming the halls, throwing parties," she said. That was infuriating, Jeffreys said, because while long-term tenants were told not to use the gym or other amenities because of COVID, they let hundreds of strangers walk through, no problem."
The city fields regular complaints about short-term rentals, but there is actually no bylaw banning or regulating the home-sharing practice first popularized by Airbnb, said licensing head Monica Ciriello. That could change in the fall, when council is expected to consider recommendations on possible rules.
As of this year, Toronto is enforcing new regulations that limit short-term rentals to a landlord's principal residence and forces owners to pay a municipal accommodation tax.
Hamilton should do likewise, said Thorben Wieditz of Fairbnb, a coalition of tenant advocates, unions and businesses concerned about the impact of so-called ghost hotels" on a national housing crisis.
It's not clear how many short-term rentals are on offer in Hamilton now, but a city staff report tallied 410 Airbnb hosts alone in 2017. Meanwhile, Hamilton apartment rental rates shot up by more than 20 per cent last year during the pandemic and the city was recently labelled one of the most unaffordable for housing in North America.
In Toronto, Wieditz said advocates hope the new short-term rental regulations will return thousands of units to long-term housing. Without such controls on vacation rentals, you're just making it that much more difficult for people to find a place to live," he said.
Who owns what at 220 Dundurn?
The history of ownership at the former silk stockings mill is complicated. Here's what we know:
Denis Vranich, son of megadeveloper Darko Vranich, bought the derelict three-story building at the corner of Dundurn and Chatham Streets for $1.5 million in 2007 and turned it into 124 luxury apartments by 2016;
Vranich earned city permission in 2018 to convert the apartment building to condo units. But the building ran into mortgage woes, and days before planned condo unit sales were to be finalized, the deals were cancelled and the building sold to a numbered company that became Dundurn Estates Inc;
Vranich was once listed as the sole director of Dundurn Estates Inc., but his name no longer shows up in corporate records and his lawyer said he no longer holds an ownership interest in the building;
A lawsuit was filed last year on behalf of 30 jilted would-be buyers that alleges breach of contract and negligent misrepresentation over the failed condo deal. Vranich denied those claims in a statement of defence filed in April, arguing buyers were aware unit sales were conditional" and could be terminated. None of the claims have been tested in court;
The condo units were transferred again in April to SOD Management Inc., which lists John Budworth as president in corporate records.
Matthew Van Dongen is a Hamilton-based reporter covering transportation for The Spectator. Reach him via email: mvandongen@thespec.com