Prominent Asheville broker listed unpermitted Airbnbs, raising NCREC ethics questions

ASHEVILLE - One of the area's largest short-term rental management agencies, and its prominent broker-in-charge, were the managers of several unpermitted downtown Airbnbs that are now at the center of a heated legal dispute. The North Carolina Real Estate Commission has now warned against the practice of listing rentals that violate city laws while also raising ethical concerns over the management of STRs.

Towns Property Management, owned by local entrepreneur Brandon Towns, is one of the largest STR management firms in Asheville , with 111 listings, according to AirDNA. Its main office is at 45 Asheland Ave., according to N.C. Secretary of State Business Registration records.

Broker-in-charge, Byron Greiner, is also the owner of Dwell Realty, is the current vice chair of the City of Asheville's Planning and Zoning Commission and is the former president of the Asheville Downtown Association. The Planning and Zoning Commission votes on the approval of major development projects and the legal language included in the city's Unified Development Ordinance, or UDO, which regulates Asheville's zoning policies. Greiner has previously served on the city of Asheville Downtown Commission.

The company had listed eight short-term rentals at 17 N. Market St. for more than two years until the city issued several notices of violation late last year for breaking city zoning law, the Citizen Times previously reported . Another unpermitted short-term rental at the property was managed by the Asheville-based Shanti Mountain Properties.

NCREC Legal Counsel and Director of Regulatory Affairs Janet Thoren said that brokers should not list prohibited rentals.

"If a broker knows or should know that local ordinances prohibit rentals, a broker must inform any potential landlord/client of the prohibition and should not put that property in their rental program until the prohibition is removed," Thoren said.

In 2018, the city limited the use of short-term rentals — rentals of less than 30 days — to areas zoned as "Resort District," while still allowing the use of homestays — a type of rental property owners can apply to use if they live on the same property they rent.

"The Commission has the authority to discipline brokers who violate the Real Estate License Law or Commission rules," Thoren continued.

All property management agencies in North Carolina are required to have a broker on staff "with limited exceptions," Thoren said. Brokers sign leases, help manage units and work with the owners of properties.

UNC Charlotte Professor of Business Ethics Denis Arnold said Greiner "absolutely" should have been aware that short-term renting the downtown properties was against city ordinance.

"He should have both been aware and informed his clients," Arnold said.

Greiner declined to comment on the rental of the properties downtown "due to all the pending litigation with owners, the city and the developer."

Brandon Towns did not respond to a request for comment.

After notices of violation for the short-term rental practice were filed in November, the developers of the 17 N. Market St. building applied to convert most of the condos to a hotel to avoid violations, the Citizen Times reported in January . The notices can lead to $500 a day fines under Asheville's rental ordinance.

The full-time residents of the building said they were not told of the application to convert the building to a mixed-use hotel, nor had the developer informed the city about its plan to use short-term rentals in the building. In response, these full-time residents filed a lawsuit to prevent further rentals and the hotel application, the Citizen Times previously reported .

According to Arnold, if the hotel application came before the Planning and Zoning Commission, the "Vice Chair has a clear conflict of interest and should recuse himself."

Greiner said he has "not had the need to recuse" himself from previous Planning and Zoning matters, but "would do so if the need arose." The 17 N. Market St. application is a Level I application, which is typically processed by city staff and would not be seen by the commission.

Greiner and Towns Property Management have strongly opposed regional short-term rental regulations, with the broker speaking at the March 18 Buncombe County Planning Board meeting in support of the short-term rental community and advocating against the restrictions on short-term rentals. Towns Property Management had provided data to the STR Trust , now rebranded as the NC Short-term Rental Alliance , for the short-term rental advocacy group's memos regarding the Planning Board's proposed regulations.

Separate complaint regarding full-home short-term rental

During brokerage complaint investigations, the NCREC determines how it will enforce policies based on whether a "reasonable broker" would've known about the possible violation—which includes local laws prohibiting rentals. Currently, the Towns Property Management and Greiner are only facing a NCREC complaint regarding advertising, Thoren said.

"As the investigation is not complete, I can’t really comment on it other than it is ongoing," Thoren said.

Greiner told the Citizen Times that the complaint is regarding a full-home rental that Towns Property Management manages. The home has grandfathering status, meaning it can be used as a short-term rental, Greiner said.

"One of the neighbors does not like the fact that the home is used as a vacation rental. She made steps to rally others in the community to not allow anymore short-term rentals going forward," Greiner said, noting that the issue was largely over the advertising of one of the units as being over the permitted septic limit outlined in state law.

"The owner of the home routinely services the septic system to make sure it is functioning. The NC Real Estate Commission has been given all the information several times by me. We satisfied the last complaint, and we will do the same on this one," Greiner told the Citizen Times.

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Will Hofmann is the Growth and Development Reporter for the Asheville Citizen Times, part of the USA Today Network. Got a tip? Email him at WHofmann@citizentimes.com.Please help support this type of journalism with a subscription to the Citizen Times .

This article originally appeared on Asheville Citizen Times: Prominent Asheville broker listed unpermitted Airbnbs, raising NCREC ethics questions