Maybe I'm misreading your tone, but you seem to find this distasteful. If this guy was stopped from doing this, and the landlord evicted him, the landlord would just capture that value. The distinction I don't understand is, why is it might be acceptable for the landlord to try to want market rate for the apartment, but not acceptable for the tenant to want market rate for a room when a new subtenant starts?

Perhaps in general, you'd like people to support themselves with work, rather than rent-seeking. I agree. But surely that view should produce at least as strong a criticism of the landlord as of the tenant?