Preferential Rent Option Doesn't Apply

Rent-stabilized tenant complained of a rent overcharge. He moved into the apartment in January 2005 at a legal regulated rent of $918. Landlord charged tenant a preferential rent of $699. Landlord didn't renew the preferential rent when tenant renewed his lease. The DRA ruled for tenant and ordered landlord to refund $1,073. Landlord appealed, claiming that the DRA incorrectly calculated an overcharge using the preferential rent instead of tenant's initial legal regulated rent. The DHCR ruled against landlord. Rent Stabilization Code Section 2521.2 bars landlord from giving tenant a preferential rent when tenant's apartment was vacant or temporarily exempt on the base date since there is no "previously established" legal regulated rent within the reviewable rent history period. The apartment was temporarily exempt on the base date because it was occupied at that time by the building super. Since tenant was the first tenant to move in after the base date, the $699 rent paid by tenant became the legal regulated rent.

Renaissance Equity Holding, LLC: DHCR Adm. Rev. Docket No. XK210012RO (5/19/10) [2-pg. doc.]