High-Rent Tenant in 421-g Building Subject to Rent Stabilization

(Decision submitted by Serge Joseph, of the Manhattan law firm of Himmelstein McConnell Gribben Donoghue & Joseph, attorneys for the tenant.)

Landlord sued to evict unregulated tenant for nonpayment of rent, claiming that tenant owed almost $11,000. Tenant asked the court to dismiss the case. Among other things, tenant claimed that he should be rent stabilized because the building was constructed under the 421-g tax benefit program established in the mid-1990s to revitalize parts of lower Manhattan. Tenant’s building opened in 2007, and tenant’s monthly rent was $4,920. Landlord argued that, since tenant’s initial rent was over $2,000, it was exempt from rent stabilization.

The court ruled for tenant and found that his apartment must remain rent stabilized while the building received 421-g benefits. The rules governing this type of housing were similar to those under the J-51 tax benefit program, and New York's highest court had ruled that rent-stabilization coverage remained in effect for high-rent units subject to that program. The case remained open for a ruling on whether tenant should get a rent abatement for a breach of the warranty of habitability.

W Associates, LLC v. Scott: L&T Index No. 73831/09 (12/23/09) (Civ. Ct. NY; Scheckowitz, J) [6-page doc.]