Landlord Didn't Demonstrate Building Was Substantially Rehabilitated

Landlord applied for a ruling from the DHCR that its building was exempt from rent stabilization based on substantial rehabilitation performed in 2001-2002 after landlord bought the building in 2000. The DRA ruled against landlord, finding that landlord failed to demonstrate that 75 percent of the building and apartment systems had been replaced.

Landlord appealed and lost. The building was a horizontal multiple dwelling (HMD), consisting of two buildings containing a total of nine apartments. Landlord failed to submit sufficient proof that any of the 12 required systems were completely replaced throughout the buildings. Landlord also submitted no proof that the common areas were rehabilitated as required by OB 95-2. DOB documentation, invoices, cancelled checks, receipts, photographs, an engineer's report, and all other proof submitted showed that the work didn't comply with OB 95-2. Moreover, landlord submitted no proof that intercoms, windows, bathrooms, or interior staircases were replaced. A statement submitted from landlord's architect didn't specify what work was done, how it was done, who did it, or when it was done. And the two Letters of Completion issued by DOB weren't obtained until 2017, which was 15 to 16 years after the sub rehab work was claimed to be completed. 

Red Hook Enterprises, Inc.: DHCR Adm. Rev. Docket No. MR210015RO (5/30/25)[10-pg. document]