Commercial Tenants Benefit Indirectly from Elevator Upgrade

Landlord applied for MCI rent hikes based on elevator upgrading and related engineering costs. The DRA ruled for landlord and increased tenants' rents. Landlord appealed, claiming that the rent increases should be higher. The DRA had allocated some of the MCI costs to professional and commercial tenants in the building. This reduced the amount of MCI costs passed on to rent-stabilized tenants. In response, tenants said that some of the second-floor professional tenants used the elevators. The DHCR ruled against landlord. An elevator upgrade benefits all tenants directly or indirectly, including professional tenants on the lobby floor, some of whom had office entrances from the street. The MCI work affects the integrity of the building where the businesses are located. So the DRA correctly apportioned some of the MCI costs to the commercial units.

35 East 35th Street: DHCR Adm. Rev. Docket No. VD410052RO (4/3/09) [4-pg. doc.]