As reported yesterday, the Appellate Division of the State Supreme Court ruled that Stuyvesant Town owner Tishman Speyer had wrongfully deregulated and raised rents on 3,000 apartments since purchasing the megacomplex in 2006, saying that apartments must remain regulated as long as building owners receive J-51 tax benefits?which gives breaks to landlords for making major improvements to their properties. The Times weighs in today and focuses on the fallout, namely, that Tishman Speyer might be forced to pony up $200 million to repay residents of those apartments for improper increases, which could lead to a wave of similar lawsuits against landlords. And will deregulated units, renovated and rented out to market-raters, become regulated once again? Heck, maybe! It's not quite clear how far-reaching this court decision will be, because Tishman Speyer has an outside shot at an appeal. But that's not stopping the celebrations and doomsday predictions.
Said a lawyer repping the tenants, "These building owners understood, or should have, that they were taking a risk. They were relying on an interpretation of the law that contradicted the plain meaning and words in the statute." Manhattan Borough President Scott Stringer said, "It is time for the owners of Stuyvesant Town and Peter Cooper Village to sit down with residents of the complex to resolve this dispute over rent overcharges in a fair and equitable manner."
Meanwhile, the president of the Rent Stabilization Association landlord group said the decision could cripple building values and lead to huge losses in tax revenues for the city: "They've basically re-regulated tens of thousands of apartments overnight. Every single tenant living in a decontrolled apartment can file for overcharges. What's the incentive for landlords to do these kind of major renovations if at the end of the day the apartments will continue to be regulated?"
· Big Landlord Found to Have Wrongly Raised Rents [NYT]
· Stuyvesant Town coverage [Curbed]