Landlord Proved Costs for Individual Apartment Improvements

Tenant complained of rent overcharge. The DRA ruled against tenant, finding that landlord made individual apartment improvements (IAIs) after the base date tenant moved out and that landlord properly increased tenant's initial rent to $2,500 per month. The apartment therefore was no longer rent stabilized. Tenant appealed and lost. Landlord submitted sufficient documentation of IAIs done in 2012 and costing $50,000, including an itemization of the work performed, and a letter from its contractor. DHCR inspection also confirmed that the claimed work was done.  The DHCR doesn't require tax documents to support a claim of cash payments. The DHCR does scrutinize cash payments, and the DRA properly accepted the contractor's sworn statement as well as the DHCR inspector's observations that the work was done. The fact that a cost affidavit submitted by landlord to the DOB was less than the claimed IAIs wasn't significant. That form contained merely a non-binding estimate submitted to another agency.

Caceres & Cela: DHCR Adm. Rev. Docket No. GT410016RT (1/8/19) [5-pg. doc.]