SAN FRANCISCO (KPIX 5) – Paying $1,800 a month in rent to share a bunk bed is hard to imagine anywhere but San Francisco. The people staying in them are not complaining. In fact, they apparently like it. But the real winner is the landlord.
Tarin Towers suspected it was bad news when Fergus O'Sullivan, a notorious San Francisco real estate investor, became her new landlord last year.
"He said there are the different ways I can evict you, I expect to have you out very soon," Towers told KPIX 5.
Most tenants took buyouts quickly. But Tarin held out. It wasn't easy. The landlord, who also owns a construction company, embarked on a noisy remodel. "Backhoes and Bobcats in the basement and jackhammers and sledgehammers," Towers recalled.
Then something interesting started to happen. Remodeled units started filling, with lots of people.
Turns out her building in the heart of San Francisco's Mission District had turned into a hostel for hipsters.
"Over six months there were probably over 50-60 different people and they were all under 30 and they were mostly men," Towers said.
In an undercover visit, KPIX 5 found 30 people currently bunking together in 2-to-4 person shared rooms. It's apparently a new trend. Dozens of similar rental offers have also been posted on Airbnb.
The planning department told KPIX 5 the so-called "hacker" or "co-living" hostels are legal under the city's short-term rental law, because guests have to stay 30 days or more.
But neighbors who suddenly find themselves living next to one of them are not happy about it at all.
"This is not being adequately regulated," said attorney Mark Hooshmand. He has filed nuisance complaints on behalf of neighbors of several other similar establishments.
"It disrupts tenants' lives. One of our lawsuits our client lived below a hacker home. He had bedbugs as a result, and constant noise," Hooshmand said.
But he says the business model is so lucrative, landlords are jumping on the bandwagon. Take Tarin's old apartment building: Right now three units are rented out as hacker homes for $10,000 a month each.
Once the other side of the property is remodeled, the landlord could be raking in $60,000 a month from one building alone.
KPIX 5 has learned Fergus O'Sullivan has filed similar floor plans for at least three more residential buildings he owns in the city.
We wanted to talk to Fergus but the only person we could locate was his brother, with the construction side of the business. KPIX 5 asked him if he could help us reach Fergus, or tell us more about the business model.
But he didn't want to talk to us, and we never got ahold of Fergus.
Towers is not surprised. "The only thing he cares about is money," she said.
Money is what finally persuaded Towers to move: Fergus ended up finally buying her out. She's currently homeless, temporarily house sitting for friends.
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