Building Exempt Due to Substantial Rehab

Landlord asked the DHCR to exempt its building from rent stabilization due to substantial rehabilitation. The DRA ruled for landlord. Tenant, who moved into the building in 2007, appealed and lost. Landlord bought the building in 1981 when it was a seven-room SRO with a ground-floor store. In 1984, the building was vacant and landlord converted the building to a five-unit, class A multiple dwelling. Landlord obtained a new Certificate of Occupancy, as well as J-51 benefits, which expired on June 30, 2003. There is no time limit for filing an application for exemption based on substantial rehabilitation. The fact that the building was vacant when rehabbed was proof that the building was in substandard condition. Landlord also submitted documentation showing that landlord had replaced at least 75 percent of the building's 14 systems. The building was gut-renovated. HPD building violations, issued over 20 years after the substantial rehabilitation, also were not sufficient to block the building's deregulation. There was no proof of fraud, contrary to tenant's claim. 

St. Pierre: DHCR Adm. Rev. Docket No. AO410028RT (7/31/14) [8-pg. doc.]