Landlord Must Offer Tenant Rent-Stabilized Renewal Lease

Tenant complained in 2022 that landlord failed to offer her a rent-stabilized renewal lease. Tenant signed an initial lease in 2016 at a rent of $2,800 per month. Landlord claimed that the building was exempt from rent stabilization due to a substantial rehabilitation completed in 2016. Alternatively, landlord argued that tenant's apartment was newly created in 2016 after combining two former SRO units and that the initial rent for the new apartment exceeded the deregulation threshold in effect at that time. The DRA terminated the proceeding because the parties had a pending case in Kings County Supreme Court. 

Tenant appealed and won. Tenant claimed that the DRA should have held her case open. She later provided a court decision upholding the DHCR's denial of landlord's sub rehab application. Based on the court decision, tenant was subject to rent regulation and was entitled to a renewal lease. There was insufficient proof in the record before the DRA in this case to determine whether an apartment was newly created in 2016 and qualified for a first rent. Landlord could file an application for an Administrative Determination by the DHCR to request exemption based on a "first rent" or high-rent vacancy deregulation based on IAIs. Meanwhile, landlord must offer tenant a rent-stabilized renewal lease using the 2016 rent as the base rent for application of rent guidelines, and must register the apartment with the DHCR.

Young: DHCR Adm. Rev. Docket No. MS210004RT (12/5/24)[2-pg. document]