Only 4 Out of 13 Building System Replacements Were Documented

Landlord applied to the DHCR for a ruling that its building was exempt from rent stabilization based on substantial rehabilitation performed in 2009 within the meaning of RSC Section 2520.11(e). The DRA ruled against landlord based on insufficient proof that the building was sub rehabbed.

Landlord appealed and lost. Landlord argued that the building always had only four apartments and therefore wasn't even subject to rent stabilization. But a court had already ruled in 2019 that the building was rent stabilized and that decision couldn't be challenged in this DHCR proceeding. The building contained 13 of the 17 systems described in DHCR Operational Bulletin 95-2, and therefore landlord was required, with limited exceptions, to show that 75 percent of those systems had been replaced. Landlord's documentation showed only that four of the 13 building systems were completely replaced, which was less than 31 percent of all systems and well below the 75 percent requirement. The systems found to have been replaced were the electrical system, interior stairways, kitchens, and bathrooms. Among other things, the General Contract for the work described: (1) roof work that constituted repairs rather than complete replacement; (2) that only repair work was done to the floors of one of the apartments; (3) that ceilings and wall surfaces were to be "repaired as needed"; (4) no proof of pointing or exterior surface repair work; and (5) no clear proof of payment for the claimed work. 

Duncan: DHCR Adm. Rev. Docket No. KX610030RO (6/22/23)[5-pg. document]