New York City is suing the owner of a 9th Avenue gelato shop for running illegal short-term rentals in 58 Manhattan buildings, including at least 12 in Hell's Kitchen.
Gokhan Simsek made about $2.4 million from 6,800 short-term rental transactions, according to court documents filed by the New York City Mayor's Office of Special Enforcement. The lawsuit was first reported by Crain's.
According to the complaint, Simsek allegedly rented the apartments between 2020 and 2023 and then rented them out through sites such as AirBnB and Booking.com. He operated under the name Stay and Smile LLC using the now-shuttered website stayandsmile.net.
All of the apartments Simsek rented in Hell's Kitchen were low-rise rental units, many of which may be rent stabilized, and the lawsuit claims the buildings are all “legally approved solely for permanent residential use.”
Last month, Simsek and business partner Ahmet Demircioglu opened Gelatoville on 9th Avenue (between West 48th and West 47th Streets). Demircioglu, who is not named in the city's lawsuit but is in many of the cases related to the apartments, told W42ST at the time that he manages several Airbnb apartments in the city while talking about his new gelato venture.
“We run some short-term and long-term apartments here,” said Demircioglu, who added that once he found AirBnB “really lucrative,” he “just started expanding and expanding.”
“Right now we have 19 apartments,” he said. But, “that's the limit, so I've jumped into another business now,” he added. “I'm not doing it anymore… I'm trying to reduce the number of apartments. [to] My employees, my friends, my chefs.”
The Special Enforcement Division began investigating Stay and Smile LLC in 2023. According to documents, Simsek appeared to be complying with new local laws, such as requiring AirBnB stays in New York City to be a minimum of 30 days and for hosts to register.
But he “continued to facilitate illegal short-term rentals throughout 2023, despite knowing that his illegal short-term rentals were the subject of investigation and that he had been ordered to cease operating,” and failed to seek legal registration under the new law, according to the lawsuit.
OSE is seeking damages ranging from $350 to $500 for each violation of the short-term rental law, plus $1 million in punitive damages.
“Today's lawsuit sends a clear message that we will not tolerate the exploitation of our precious housing stock for unlawful private gain,” New York City Mayor Eric Adams said in a statement.
W42ST has reached out to Simsek and Demircioglu for comment and will update this story.
