HDFC Building with Rents Set by HPD Isn't Subject to Rent Stabilization

Tenant complained to the DHCR that landlord failed to give her a proper renewal lease in the form required under the Rent Stabilization Code and rent guidelines. The DRA ruled for tenant and directed landlord to offer tenant a renewal lease based on landlord's failure to answer the complaint.

Landlord appealed and won. Landlord pointed out that the building was owned by a Housing Development Fund Corporation (HDFC) created under Article XI, Section 576 of the Private Housing Finance Law (PHFL). Therefore, the tenant wasn't rent stabilized. Although landlord defaulted before the DRA, the DHCR considered landlord's claim since jurisdictional arguments can be raised at any time during an administrative proceeding. Generally, under RSC Section 2520.11(b), HDFC-owned buildings that are conveyed by the city for purposes of being low-income housing and over which the city and HPD have control of the rents, aren't under DHCR jurisdiction. Here, an HDFC owned the building, the initial rents were set by HPD, and subsequent rent increases are overseen by NYC through HPD, which determines the income level of tenants and their rents, and pays the tenants' subsidies. 

11-15 New Montrose, HDFC: DHCR Adm. Rev. Docket No. LP210020RO (11/16/23)[2-pg. document]