Landlord Wants to Recover Portion of Underused Rent-Controlled Apartment

(Opinion letter submitted by Eileen O'Toole of the Manhattan law firm of Kossoff Alper & Unger. Landlord asked the DHCR to explain the procedure for recovering a portion of an underused rent-controlled apartment. In an opinion letter, the DHCR advised landlord to use DHCR Form RA-54 to apply to subdivide a rent-controlled apartment containing six or more rooms that is underused. Landlord must intend to increase the number of apartments in the building to get permission to recover a portion of the rent-controlled apartment. Landlord also must show that it can't make a net annual return of 8.5 percent of the building's assessed valuation. ''Assessed valuation'' means the property tax assessment determined by the New York City Department of Finance. But the 8.5 percent requirement won't apply if there remain three or fewer occupied apartments, making up 10 percent or less of the total apartments in the building, or one occupied apartment if the building contains 10 or fewer apartment.

DHCR Opin. Ltr. by Charles Goldstein (10/18/02) [3-pg. doc.]