Venice businessman must turn his hotel back into apartments, planning commission rules

Arguing that turning apartments into hotel guest rooms undermines Los Angeles’ efforts to improve access to housing, a Westside planning board this week ruled against a businessman who has been trying to legalize his conversion of a 32-unit apartment building on the Venice boardwalk.

“This seems to be contrary to all the city’s policies to preserve affordable housing,” said West Los Angeles Area Planning Commissioner Esther Margulies during a hearing on Wednesday evening.

Venice businessman Carl Lambert later said he would appeal the planning commission’s 3-0 ruling on his request to the Los Angeles City Council.

The ruling comes amid a wave of controversial hotel conversions as Venice, a once-funky beach town that is now home to offices of Google, Snap and other tech companies, transitions into a luxury residential community and tourist destination. Longtime residents argue they are being pushed out.

Lambert, who operates as many as 90 hotel rooms in Venice, purchased and renovated the Ocean Front Walk building in 2005 and began advertising it as an “extended stay” hotel called Venice Suites. In the 1990s, long-term tenants had leased the rent-stabilized studios and one-bedroom apartments for rates as low as $500 a month, former renters said.

City Attorney Mike Feuer filed a lawsuit against Lambert two years ago, claiming the conversion was illegal. A Los Angeles Superior Court judge, in a partial decision last year, ruled in Lambert’s favor, saying the city code did not prohibit renting apartments for short stays.

A trial on the city attorney’s remaining claims of false advertising and unfair competition — for presenting the building as a hotel — is set to begin May 29, a spokesman said.

Meanwhile, the City Council has adopted new rules since the judge’s ruling last year, allowing Airbnb-style short-term rentals only in Angelenos’ “primary residences” — not at a second home or an investment property. A city zoning administrator also turned down a separate application that Lambert had filed for a zoning variance to operate the Ocean Front Walk building as a hotel, setting the stage for Wednesday’s public hearing.

During the testimony, Lambert and his lawyers cited old building permits and city codes that they said permitted him to turn the building into an “apartment-hotel.”

“I have vested rights,” he told the planning commissioners.

Lambert’s team and supporters also contended that Venice needs more hotel rooms. The beach town’s zany street performers, skaters, muscle men and sidewalk vendors have turned the boardwalk into an international tourist destination.

Venice residents countered that the tourists come for the bohemian charms of artists and performers who increasingly can’t afford to live there.

“We’re at risk of becoming a neighborhood without neighbors,” said Judy Goldman, who also warned of a “domino effect” if the hotel conversion was approved. Another appeal is pending over the 52-unit Ellison building in Venice, which was cited by the city as an illegal hotel. The building’s owner, Lance Robbins, is vigorously contesting the complaint.

Zoning Administrator David Weintraub told the commission that he rejected Lambert’s variance request because other city codes, planning designations and permits trumped the old documents the hotelier’s team unearthed. If Lambert had vested rights for a hotel, he wouldn’t need a variance, Weintraub said.

Commissioner Margulies acknowledged that the city’s paper trail on rentals and hotels is troubling.

“I’m really in disbelief,” Margulies said of the conflicting language. “This is not the first time we have found some loopholes or vague policies that seem to be in contradiction to the city’s policy to preserve housing.”

But she and other commissioners said they were swayed by the city’s affordable housing crisis.

After the hearing, Lambert said he had been unfairly caught up in the political furor over short-term rentals.

“I feel the process was a stacked deck against me for political reasons,” he said. “I lovingly restored that building. Otherwise, it would have been razed and you would have two condos there.”

gholland@latimes.com

Twitter: @geholland