Results tagged “rentruling”

As landlords and tenants await what happens next regarding the ruling that found Stuyvesant Town rents were wrongfully raised while its owner received tax breaks, the NY Times looks at how the real estate industry is nervous. The J-51 tax break program was "meant to encourage building renovations," and after significant renovations, landlords "are allowed to pass along a portion of the renovation costs to the tenants’ rent. As a result, landlords can raise rents that exceed or approach the $2,000 deregulation threshold." In the case of Stuyvesant Town, it's argued rents went up too much (the Observer has some examples). Right now, the ruling has been stayed, but a court must decide whether to let Stuy Town owner Tishman Speyer appeal; if upheld, the Times reports, "Industry officials say the decision could affect as many as 80,000 apartments in the city, trigger widespread defaults on loans, eliminate construction jobs and reduce property tax revenues for the city." Tenants' advocates, though, say the real estate industry is exaggerating.

Developer Tishman-Speyer was granted a stay that pauses a ruling which found it wrongfully raised rents at Stuyvesant Town and Peter Cooper Village. Tishman bought the rent-regulated complex for $5.4 billion, hoping to profit on market-rate rents, but a state appeals courts found the rent increases shouldn't have happened since it was receiving tax breaks associated with rent-regulated properties. The Observer reports, "Rather than immediately re-regulate the 4,000-plus apartments in Stuyvesant Town that have been converted to market rents since 1993, as the appellate court’s decision would require, the stay calls for Tishman to calculate how much money it would owe in back rent to market-rate tenants and put that money in an escrow account." A lawyer for Stuy Town tenants says that Tishman could owe tenants $200 million and the ruling affects many other landlords who got tax breaks for property improvements and then deregulated apartment.