A rent-controlled apartment in Manhattan in the twenty-first century is a thing a precious few people will ever experience firsthand. For most, it's largely the stuff of legend. The lucky ones the real estate gods have smiled upon cling to their golden ticket for dear life, doing stuff they'll never tell their children or grandchildren about to protect it. Stuff that keeps them up at night. Stuff that innocent financial services employees like you should never have to hear about. A rent-controlled apartment in Tribeca? With three bedrooms? Get the hell out of here. And yet one William Terry Krueger just couldn't help himself.
United American Land...alleges in a New York Supreme Court lawsuit that William Terry Krueger, the co-founder and senior managing partner at Nova Capital Partners, an investment bank focused on emerging markets, and the other tenant of record, Adrienne Kennedy, were renting out Unit 5SW at 118-120 Duane Street between Broadway and Church Street on a nightly basis. Mr. Kreuger and Ms. Kennedy extended their lease on May 13, 2014 for a two-year period commencing Sept. 1, 2014 at a monthly rent of $1,093.21, according to court documents. A month later, the defendants “began renting the premises to various individuals unknown to plaintiff and without plaintiff’s consent on a daily and/or short-term and transient basis,” the suit alleges...United American’s suit charges that “tourists and other transient visitors” are staying in the apartment for “stays of less than 30 days at at a rate of $290 to $450 per night.” If the defendants rented their apartment out every night of the year, they could make an annual profit of $92,731.48, the suit claims...Ms. Kennedy’s Airbnb listing says that “the premises accommodates four people, contains three beds and three bedrooms,” and that prospective renters must pay a $500 security deposit and a $125 cleaning fee, documents indicate.
You don't get to where the William Terry Kruegers of the world are today by seeing a sixfold ROI and walking away from it.
Banker Sued For Renting Out Tribeca Pad by the Night [Commercial Observer]