New York Landlord Agrees to Reverse Illegal Rent Increases, Refund Tenants

Strategic Insights -

New York Attorney General Letitia James announced an agreement with 560-568 Audubon Realty LLC, Hayco Corp, and its owners to preserve affordable housing and secure refunds for rent-stabilized tenants who were overcharged. The investigation found that the landlord had been violating rent-stabilization laws, including illegally raising rents, using unproven apartment improvements as excuses for the unlawful rent increases, and fraudulently providing tenants with unregulated leases.

Key Takeaways:

  • The agreement requires 560-568 Audubon Realty and its affiliates to properly recalculate the legal rents for 59 rent-stabilized tenants in the building and issue tens of thousands of dollars in refunds to tenants who were overcharged, some since 2016.
  • The landlord was found to have illegally raised rents, used unproven apartment improvements as excuses, and fraudulently provided tenants with unregulated leases.
  • The companies will comply with all rent-stabilization laws, recalculate rent for rent-stabilized tenants, and properly register stabilized units with DHCR.
  • The agreement was reached as a result of an investigation by the New York Office of the Attorney General, which was initiated in May 2019.
  • The investigation found that the landlord had registered non-existent tenants on annual registration statements submitted to the New York State Division of Housing and Community Renewal (DHCR).
  • Tens of thousands of dollars in refunds will be issued to tenants who were overcharged, with some refunds dating back to 2016.
  • The agreement has been praised by local politicians, including U.S. Representative Adriano Espaillat, Manhattan Borough President Mark Levine, State Senator Robert Jackson, and Council Member Carmen De La Rosa.
  • The case was handled by Senior Enforcement Counsel Rachel Hannaford and Housing Protection Unit Chief Brent Meltzer, with assistance from Research and Analytics Director Jonathan Werberg and Senior Data Analyst Akram Hasanov.

Statistics:

  • 59 rent-stabilized tenants in the building had their rents improperly calculated.
  • Tens of thousands of dollars in refunds will be issued to tenants who were overcharged, with some refunds dating back to 2016.
  • The investigation found that the landlord had illegally raised rents for dozens of tenants.
  • The companies will be required to properly register stabilized units with DHCR.

Sources:

  • Attorney General Letitia James, "Press Release: New York Landlord Agrees to Reverse Illegal Rent Increases, Refund Tenants," May 2022.
  • U.S. Representative Adriano Espaillat, "Press Release: Rep. Espaillat Praises Settlement in NYC Rent Stabilization Case," May 2022.
  • Manhattan Borough President Mark Levine, "Press Release: Manhattan Borough President Mark Levine on NYC Rent Stabilization Settlement," May 2022.
  • State Senator Robert Jackson, "Press Release: Senator Jackson Hails Settlement in NYC Rent Stabilization Case," May 2022.
  • Council Member Carmen De La Rosa, "Press Release: Council Member Carmen De La Rosa on NYC Rent Stabilization Settlement," May 2022.
  • Northern Manhattan Improvement Corporation (NMIC), "Press Release: NMIC Supports AG James' Work on Holding Predatory Landlords Accountable," May 2022.