First Lease to 421-a Tenant Contained Improper Preferential Rent

Landlord sued to evict rent-stabilized tenant for violating a substantial obligation of her tenancy by refusing to renew her lease. Tenant claimed that the renewal lease offered was improper. Tenant was the first tenant to occupy the apartment in a new building receiving Real Property Tax Law Section 421-a tax benefits. Tenant's initial lease listed a legal regulated rent of $1,100 and a preferential rent of $900. The renewal lease calculated rent guideline increases over the higher legal regulated rent. But preferential rents aren't permitted under the initial lease of an apartment in a 421-a building. So tenant's initial legal regulated rent was $900, and a renewal lease must be based on that rent. The court ruled for tenant and dismissed the case.

Sterling Pl. Condo LLC v. Shaffner: Index No. 077557/17, NYLJ No. 1528710063 (Civ. Ct. Kings; 5/31/18; Finkelstein, J)