Legal or not, it's never a good idea flying so low, for quite a number of reasons.
If it had been a practice forced landing, then I could understand it, and why the pilot might not have noticed the hotel. However from reading vfr's description, he seems to indicate that the aircraft flew at this height for some time.
Maybe the rotar pilot should also have had a better lookout before attempting to take off.
However at the end of the day, there is no good reason for flying so low just for fun. Of course there is always the possibility that this was not for fun, and that maybe they had some problem, and only got it sorted at the last second.
However as a community, I think we can sometimes be too quick to jump to someones defence and say something is not illegal, when clearly it is not safe, and does nothing for the cause of GA freedoms. We should not be condoning unsafe flying.
dp