Landlord Must Continue Tenant's Preferential Rent Agreement

Tenant complained of a rent overcharge after landlord discontinued tenant’s preferential rent. The DRA ruled for tenant and ordered landlord to refund $5,500, including interest. Landlord appealed and lost. Landlord claimed that the preferential rent agreement included in tenant’s initial lease was intended to extend for one renewal period only after tenant and prior landlord signed an initial lease with an attached preferential rent rider in 1993. But the same rider was added to all of tenant’s renewal leases until 2007. And the language of the 1993 rider showed that it was intended to apply to all of tenant’s renewal leases. It said that, “The rent payable on the renewal of this lease, with this tenant only, shall employ this reduced rent as a base, to which shall be added any rent increases allowed by law . . . . Future leases after the tenancy of the person(s) signing below may, at landlord discretion, provide for a rent based on the registered legal rent provided below, as increased by the applicable guidelines and other increases in the rent allowed by law.”

Lexford Properties, LLP: DHCR Adm. Rev. Docket No. XI410059RO (3/18/10) [4-pg. doc.]