By Lookout Staff

January 29, 2026 -- The City Attorney's office last week sued the owners of 28 Santa Monica rent-controlled apartment buildings who allegedly made $18 million illegally renting units as short-term rentals.

According to the lawsuit filed in Superior Court Thursday, for more than five years the defendants have rented at least 62 units in at least 25 properties to short-term guests nearly 3,000 times.

The complaint requests that the defendants -- the Enayatis and numerous entities they control and operate -- "be ordered to cease their unlawful short-term rentals and pay civil penalties of $2,500 per violation," the lawsuit states.

The complaint alleges the unlawful short-term rental scheme included:

• Listing the rent-controlled units on Airbnb.com once long-term tenants vacate,
• Having guests book stays on Airbnb.com for their actual, intended, short-term stay, generally for less than 100 days,
• Communicating outside of the Airbnb.com platform to have guests sign a sham one-year lease agreement,
• Renting the furnished units for the short-term duration to Airbnb.com guests not using the units as their primary residence,
• Intentionally deceiving guests with the fraudulent lease agreements and fraudulent statements, and
• Failing to file mandatory rent control registration forms or filing deceptive and misleading rent control registration forms.

"If asked about the lease requirement, the Enayatis have told potential guests that the reason for having a written lease in addition to the Airbnb.com booking is for protection against squatters," the complaint alleges.

Under the City’s Residential Leasing Requirements Ordinance (RLRO), an initial lease term must be for at least one year and units must be unfurnished and used as a tenant’s primary residence.

"By prohibiting rentals to short-term guests, the RLRO preserves rental housing for long-term residents and helps keep rents down," City officials said.

“Preserving rent-controlled apartment homes and keeping rents down are top priorities for the City,” Deputy City Attorney Jonathan Frank said.

“The City takes violations of its short-term rental ordinances seriously and will enforce them when needed.”