Filled with illegal activity!

One such hotel is Jazz on Times Square, which charges $40 a night to sleep in a bunk bed in a neighborhood zoned for residential use only. And though they were shut down in January, they paid $3,200 in fines and reopened. It would be logical to believe the city could just shut them down again, but City Council Speaker Christine Quinn told the Daily News it's not easy for someone in a position of authority to stop others from doing illegal things. "Closing down illegal hotels is much more challenging than it should be. We tried to find a hook in city law that would let us do it, and we couldn't."

A 2009 Appellate court decision ruled that a hotel is legal if a majority of the single-room units are leased for over 30 days a month, and it's that vague loophole that keeps many illegal hotels from being shut down permanently. Many landlords will kick out residents and market the empty rooms as hotels, but by keeping the majority of the rooms as rentals they can avoid violations. To make matters worse, the Jazz on Times Square building is owned by the charity Women in Need, who rented the building to the hotel owners once they stopped using it as a homeless shelter. The building retains its nonprofit exemption status, and barely pays property taxes.

Someone from the Finance department did check out the hotel, and said, "We found it was operating as a hotel. We're removing the charitable exemption." The NYC Building's Department website says there is a partial stop work order on the property, but there is no language indicating it's operating illegally. However, the hotel's website says there is a minimum six night stay for anyone booking a room. Not quite 30 days a month, but a possible loophole in action?!