Rent Hike for New Roof Reduced

Landlord applied for MCI rent hikes based on the installation of a new roof and facade restoration. The DRA ruled for landlord. Tenants appealed, arguing that communications equipment had been placed on the roof and landlord was receiving rental income for this from AT&T Wireless. The DHCR ruled for tenants and reduced the amount of the MCI rent hike. Income received by landlord from leasing space within the building or on the roof to a communications company is commercial rent. When the MCI work benefits the commercial as well as the residential tenants, the approved MCI costs must be reduced by a commercial allocation. Landlord leased 794 square feet out of a total building area of 69,960 square feet to AT&T. Therefore, a portion of the cost of the MCI rent hike must be allocated to this commercial tenant and subtracted from the cost divided among tenants.

3881 Sedgwick Avenue: DHCR Adm. Rev. Docket No. UJ630060RT (9/19/08) [3-pg. doc.]