Discontinuation of Courtyard Access Results in Permanent Rent Reduction

Cooperative shareholder tenant requested permission from the DHCR to modify services for 63 rent-stabilized and rent-controlled tenants by discontinuing off-site courtyard access. Landlord claimed that maintaining this service was no longer feasible and discontinuing it would have a de minimis effect on tenants’ use and enjoyment of their apartments. The DRA ruled for landlord but ordered that tenants’ rents would be reduced permanently by $23 per month effective February 2014 to compensate for the loss of services. Landlord appealed, claiming that the rent cut would deprive landlord of over $17,000 in annual income. Landlord pointed out that none of the tenants objected to discontinuance of courtyard access, that no tenants had direct access to the courtyard since 1986, and that few tenants used it. Landlord also argued that tenants had use of a roof garden/sun deck at the building and could also use the High Line park.

The DHCR ruled for landlord in part. Use of the courtyard was unquestionably a required service, registered with the DHCR in 1984 as a recreational facility. In 2014, a license agreement between landlord, who was London Terrace Towers and owned four corner buildings, and London Terrace Gardens, owner of the block-long building complex in between the towers expired, so landlord couldn’t control lack of access to the courtyard. But the $23 rent reduction was based on discontinuance of a playground area at $15 and discontinuance of shrubbery grounds at $8. And review of evidence showed that there was no playground-related equipment in the area; it was largely undeveloped asphalt with water fountains, benches, and shrubs. So the permanent monthly rent reduction was reduced from $23 to $10.

London Terrace Associates: DHCR Adm. Rev. Docket No. DP430038RO (8/10/16) [8-pg. doc.]