Where Apartment Vacant on Base Date, Next Legal Stabilized Rent Was Charged

Tenant complained of rent overcharge and improper apartment deregulation. The DRA ruled for tenant, finding that tenant was rent stabilized and that the lawful monthly rent as of September 2017 was $1,212.

Landlord appealed and lost. The apartment was vacant on the July 2011 base date. Landlord argued that: (a) a prior tenant paid $1,651 in 2010; (b) improvements were the made to the apartment that brought the lawful rent over the $2,500 deregulation threshold in effect at that time; (c) the apartment became permanently exempt in 2012; and (d) if the apartment was still rent stabilized, the rent should equal $1,651 plus any lawful increases.

The DHCR disagreed and found that, prior to amendment in 2014, Rent Stabilization Code Section 2526.1(a)(3)(iii) provided that when an apartment was vacant on the base date, the subsequent legal regulated rent was the rent agreed to by the landlord and first rent-stabilized tenant moving in after that vacancy. In this case, the first rent agreed upon and paid after the base date vacancy was $1,050 per month. There can be no preferential rent following the base date vacancy. So there was no reason to consider whether the claimed apartment improvements were properly considered because landlord waived any related rent increase by charging the first tenant after the base date vacancy $1,050 per month. 

133 West 145 LLC: DHCR Adm. Rev. Docket No. FX410041RO (10/31/18) [2-pg. doc.]