Garage Parking Was a Required, Ancillary Service to Rent-Regulated Tenants

Landlord filed an Article 78 court appeal of a DHCR decision finding that garage parking at landlord's building was a required ancillary service under rent stabilization. Landlord claimed that the parking garage was operated independently and therefore parking wasn't a required service and parking fees weren't subject to rent guideline increases.

The court ruled against landlord, who appealed and lost. The building's superintendent, employed by landord, was also the owner of the parking garage, which was operated as a limited liability corporation. The DHCR had a rational basis for finding that the parking service was ancillary and required under rent stabilization, due to the common ownership of the building and the parking garage. Landlord presented no lease agreement demonstrating independent garage ownership. And the DHCR noted that a rent check from the LLC to landlord included the notation "minus the 2000 that comes out my check every month."  Given the super's employment status, this indicated landlord's indirect ownership of the parking service. In addition, landlord's rent ledger showed that the garage owed monthly rent to landlord in the amount of $3,250 while there was only one payment of $1,300 to landlord during a four-month period.

Matter of 5400 Co. v. DHCR: 2024 NY Slip Op 02581 (App. Div. 1 Dept.; 5/9/24; Manzaret-Daniels, JP, Kapnick, Gesmer, Rodriguez, JJ)