Airbnb watchdog flags hundreds of Toronto condos as ‘ghost hotels’

A Canadian Airbnb watchdog has sounded alarm bells over the number of condo buildings in Toronto acting as “ghost hotels.”

In a Saturday press release, representatives for Fairbnb, a not-for-profit coalition of hotel owners, academics and concerned citizens that advocates for equitable short-term rental regulations across the country, said there was “an alarming pattern” that has allowed residentially zoned and taxed buildings to operate as so-called “ghost hotels.”

Ghost hotels are usually condo units rented by tenants who then list the units on short-term rental apps like Airbnb, thus turning a substantial profit. The City of Toronto implemented policies to prevent this sort of sub-leasing around the time of the pandemic, but as tourism has slowly returned to the city, so too have ghost hotels.

Ghost hotels made headlines in Toronto when two bullets were fired through a wall of a York Street condo in 2020 in a unit neighbours said was being used as an illegal short-term rental. Former City councillor Joe Cressy disavowed ghost hotels at the time, saying the city “desperately need[s] short-term rental operators like Airbnb to delist properties that don’t comply” with municipal zoning and tax requirements.

According to Fairbnb,a number of Toronto condominiums have a shocking number of short-term rentals in the system. These buildings ICE Towers at 12 and 14 York Street with 236 short-term rental units, 300 Front Street West with 195, and The Parade Towers at 15 and 21 Ice Boat Terrace with 166.

Data collected by Fairbnb also shows that the Spadina-Fort York area is also home to a “staggering” 2,058 short-term rentals, which makes up about one third of Toronto’s total Airbnb inventory, but is down significantly from the estimated 7,000 short-term rental properties in the ward in 2020.

“In Toronto, STRs in investment properties are prohibited, and only principal residences can be advertised on platforms like Airbnb. Seeing hundreds of STRs in one single building known to be dominated by investment units poses the question as to whether these STRs are indeed legal or whether property management companies and hosts are scheming the system in one way or another,” Thorben Wieditz, executive director of Fairbnb, said in the press release.

“The result is effectively the same, we are looking at residentially zoned and taxed buildings operating as ghost hotels.”