No Proof of Unique or Peculiar Circumstances Warranting Rent Hike

New landlord asked the DHCR for permission to increase rents of five rent-controlled apartments in a building based on unique and peculiar circumstances. Landlord pointed out that: (a) a 1983 CAB expulsion order had placed the rent-stabilized tenants in the building back under rent control; (b) the prior landlord had been incapacitated; (c) a guardian appointed for the landlord had limited authority; (d) tenants had taken over and mismanaged the building; and (e) no rent increases had been collected since 1983. Therefore, landlord argued that the DHCR should increase the tenants' maximum collectible rents (MCRs).

The DRA ruled against landlord, finding that there was no proof that the rents couldn't have been increased by prior landlord. The building hadn't been registered with the DHCR since 1992, current landlord hadn't applied for MCI rent increases despite a claim of building-wide improvements, and neither the prior nor current landlord applied for maximum base rent (MBR) increases for the rent-controlled tenants. A rent increase based on unique and peculiar circumstances could be granted only where abnormally low rents were caused by circumstances beyond the reasonable control of the landlord when properly managing the building.

Landlord appealed and lost. The DHCR ruled that the circumstances leading to the claimed low rents weren't beyond the landlord's reasonable control. There was no apparent attempt by prior landlord to legally increase the rents for 10 years before he became incapacitated, and there was no proof that landlord's guardian or the tenant's "association" had mismanaged the building between 1993 and 2015. 

211 8th Avenue Group, LLC: DHCR Adm. Rev. Docket Nos. HM220024RO through HM220028RO (11/6/19) [4-pg. doc.]