Landlord Didn't Prove Building Was Substantially Rehabbed

Landlord asked the DHCR for a ruling that its building was exempt from rent regulation due to substantial rehabilitation in 2008. The DRA ruled against landlord. Landlord spent $24,000 to convert a six-unit SRO building to a four-family dwelling, and DOB issued a new certificate of occupancy (C of O) in 2008. The DRA found that landlord failed to demonstrate that 75 percent of building and apartment systems had been replaced.

Landlord appealed and lost. Detailed review showed that landlord didn't replace at least 13 of the building's 17 systems. DOB records showed that, at most, landlord replaced the heating, intercom, kitchens, bathrooms, doors, walls, and ceilings. The $24,000 cost seemed implausible for a sub rehab. Landlord didn't submit an architect and/or engineer affidavit or any DOB permits and sign-offs for electrical and plumbing work. The conversion of a 10-unit SRO to a four-family dwelling with a new C of O did not, by itself, exempt the building from rent stabilization. Generally, a conversion from six or more dwelling units to fewer than six dwelling units didn't remove a building from rent stabilization. The DHCR wouldn't consider landlord's photographs, submitted for the first time on appeal and, in any event, they didn't support landlord's claim.

Goberdhan: DHCR Adm. Rev. Docket No. IV410005RO (1/25/21) [11-pg. document]