Commercial Leases No Bar to Rent-Stabilization Coverage

Facts: Tenants signed commercial leases when they moved into a building, even though they claimed that landlord had converted the units to residential apartments. Some years later, landlord sent tenants a notice of its intent to convert the building to condominiums. Shortly thereafter, landlord sent tenants termination notices. Tenants then sued landlord. Tenants claimed that they were subject to rent stabilization, that landlord couldn't terminate their tenancies, and that they should be allowed to purchase their apartments. Tenants asked the court to delay landlord from seeking their eviction while the court considered their claims. Court: Tenants win. Tenants were likely to win on the merits of their claim to be rent stabilized. Tenants showed documentation that the building had more than six apartments and was built before 1974. If landlord illegally converted the units to residential units, it had done so before tenants moved in. Zoning also allowed residential use of the building, so landlord couldn't claim that the building couldn't be legalized. In the meantime, while the court was considering the case, landlord couldn't go forward with any eviction actions.

Otus v. Northside Development LLC: NYLJ, 8/23/06, p. 22, col. 3 (Sup. Ct. Kings; Saitta, J)