Rent-Controlled Apartment in Building with Expired J-51 Benefits Not Subject to Deregulation

Landlord applied for high-rent/high-income deregulation of tenant’s rent-controlled apartment in 2011. The DRA ruled against landlord because rent-controlled apartments continue to be exempt from luxury deregulation after J-51 tax benefits have expired. Landlord appealed and lost. Landlord argued that tenant was rent controlled prior to the building’s receipt of J-51 benefits and therefore should be subject to deregulation after the J-51 benefits expired. But the DHCR found that, unlike the rent stabilization law, there was nothing in the rent control law that provides for the resumption of the availability of high-income rent deregulation after J-51 benefits have expired. In 2014, an appeals court had applied this rule in Ram I LLC v. DHCR, citing Rent Control Law Section 26-403(e)(2)(j).

Regina Metropolitan Co. LLC: DHCR Adm. Rev. Docket No. ER420048RO (12/22/16) [4-pg. doc.]