Building Receiving RPTL Section 421-g Tax Benefits Subject to Rent Stabilization

August 19, 2017

LVT Number: #27843

Building tenants sued landlord, claiming that they were rent stabilized due to Real Property Tax Law Section 421-g tax benefits received by landlord and/or a low-interest mortgage loan obtained under the Private Housing Finance Law (PHFL). The building received the tax benefits and low-interest mortgage after conversion from commercial to residential use in 2005. Among other things, landlord argued that, since initial apartment rents were all more than $2,000 per month in 2005, they were exempt from rent stabilization despite the tax benefits.

Building tenants sued landlord, claiming that they were rent stabilized due to Real Property Tax Law Section 421-g tax benefits received by landlord and/or a low-interest mortgage loan obtained under the Private Housing Finance Law (PHFL). The building received the tax benefits and low-interest mortgage after conversion from commercial to residential use in 2005. Among other things, landlord argued that, since initial apartment rents were all more than $2,000 per month in 2005, they were exempt from rent stabilization despite the tax benefits. The court ruled for tenants, finding that RPTL Section 421-g clearly calls for rent regulation while receiving the tax benefits and that high-rent vacancy decontrol during that time was contrary to law. 

West v. B.C.R.E.-90 West Street, LLC: 2017 NY Slip Op 27242, 2017 WL 3079824 (Sup. Ct. NY; 7/19/17; Reed, J)

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