A single hotel license, issued in 2021 for one high-rise on Chicago’s South Michigan Avenue, ended up attached to more short-term rental units than most apartment buildings in the city even contain. Real estate broker Milan Rubenstein used that one registration number — tied to a furnished-rental tower he owns near McCormick Place — to cover at least 167 separate units scattered across neighborhoods that had nothing to do with the address on the license, according to a lawsuit the City of Chicago filed in Cook County Circuit Court. By the time the city sued, Rubenstein and his company, Slumber Stay LLC, had already racked up nearly 200 citations for shared-housing violations across 2024 and 2025 alone. Airbnb is a co-defendant. City attorneys say the platform kept the listings live long after it knew they were unregistered.
A License Built for One Address, Stretched Across a City
Chicago’s short-term rental rules were never written to be flexible in the way Rubenstein allegedly used them. Under the city’s Shared Housing Ordinance, a single-family home or a building with two to four units can host only one active short-term rental, and it has to be the host’s primary residence. Buildings with five or more units are capped at whichever is smaller: one-quarter of the total dwelling units, or six. Anyone who wants to operate more than one registered rental at a time has to apply for a separate Shared Housing Unit Operator License first.
Rubenstein’s workaround skipped that structure entirely. In 2021 he applied for and received a hotel license, a different regulatory category, for a high-rise at 2036 South Michigan Avenue that he owns and runs as a furnished short-term rental property. That single, non-transferable license number is what the city says he then reused for units he did not hold shared-housing registrations for, in buildings he did not own, in neighborhoods far from South Michigan Avenue. None of those units ever went through a per-building cap review at all.
The Numbers Behind the Scheme
By the city’s count, 167 units were tied to that one hotel license as of this spring. Slumber Stay’s own website was still showing 156 active listings as of the Monday the lawsuit landed, 95 of them in Chicago and heavily clustered in the Near South Side. In March and April of this year alone, the city says, more than 500 stays were booked through unregistered listings tied to Rubenstein’s operation, generating over $1 million in booking revenue each of those two months. Investigators also allege the operation used different host names and fabricated registration numbers on individual listings to dodge the city’s compliance checks, a detail that moves this well past a paperwork lapse and into something closer to a shell game run in plain sight on a major booking platform.
Slumber Stay’s site went dark the morning after the suit was filed. It’s worth sitting with what the scale actually means for a renter: someone booking a “Slumber Stay” unit for a weekend in Chicago had no way of knowing the listing wasn’t legally registered at all, because the operation was built specifically so that it would look like it was.
Not a First-Time Landlord
Rubenstein isn’t a small operator who stumbled into a loophole. According to property records cited by The Real Deal, he has at points owned more than 740 apartment units across the Chicago area, including a 344-unit complex in Mount Prospect he assembled piece by piece between 2010 and 2014 for a combined $24.4 million and sold the same year for $33 million. Slumber Stay itself operates beyond city limits too, with listings in Nashville and Phoenix in addition to Chicago.
What the City Is Asking For
Chicago is seeking fines of $3,000 per day against Rubenstein and Slumber Stay, $10,000 per day against Airbnb, disgorgement of profits from the unregistered rentals, and a court order barring further violations. “Requiring short-term rental companies to follow the same rules as everyone else is critical to building a safer, more affordable Chicago,” Mayor Brandon Johnson said in a statement announcing the suit. Chicago Corporation Counsel Mary Richardson-Lowry was blunter about why the city let the violations pile up before escalating to litigation, saying the defendants “continue to not bring themselves in compliance” and that the pattern “affects the safety of those who inhabit those units,” as well as neighborhood affordability more broadly.
Chicago built its per-building caps around a specific unit count, checked address by address. A hotel license meant for one high-rise operating at one address became, city attorneys say, a skeleton key for buildings scattered across the map instead. The lawsuit is still working through Cook County court, where a judge will eventually decide whether that license can legally cover a scattered portfolio, or whether a rental cap only holds up until someone finds the right form to file.
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