Former Low-Income Housing Becomes Rent Stabilized

Landlord was a limited dividend housing company formed under the State Housing Law of 1926 and subject to the Private Housing Finance Law. Landlord operated a development with 1,590 apartments under the supervision of the DHCR. Landlord asked the DHCR for permission to dissolve, deregulate, and transfer the complex to a private entity. The DHCR ruled for landlord on the condition that the apartments would be subject to the Rent Stabilization Law. The Tenants' Association appealed, claiming that the DHCR's decision was arbitrary and unreasonable. The court ruled for tenants, finding that the DHCR didn't have the authority under the law to allow the transfer of the complex to a private entity. The complex must be transferred either to the City of New York or to another limited dividend housing company. Landlord appealed and lost. Although the Private Housing Finance Law permits landlord to dissolve, the law states that no housing company can sell or transfer any property except to a municipality or, with the DHCR's consent, to another limited dividend housing company.

Knickerbocker Village Tenants Association v. Calogero: NYLJ, 11/1/07, p. 35, col. 2 (App. Div. 1 Dept.; Lippman, PJ, Andrias, Williams, Kavanagh, JJ)