Salvation Army Residence Is Exempt from Rent Stabilization

The Salvation Army notified tenants in one of its residence buildings that it wouldn't renew their leases and that they must move out in six months. Tenants sued the Salvation Army. They claimed that they were rent stabilized. The Salvation Army argued that it was exempt from stabilization because the building was used for charitable purposes. Tenants said that the Salvation Army made a profit by renting to students; therefore, the building wasn't primarily used for charitable purposes. The court ruled against tenants. Leasing some rooms to university students was incidental to the organization's primary charitable purposes. Any profit received from rentals didn't bar the Salvation Army from claiming exemption from rent regulation since the organization's profits were channeled toward its charitable causes.

Parkside-Ten Eyck Tenants Association v. Salvation Army, Inc.: NYLJ, 9/13/07, p. 27, col. 3 (Sup. Ct. NY; Tingling, J)