Major Capital Improvement (MCI) Rent Increases
The tenants in my building are about to sign new leases that were mailed to them. I plan on doing some capital improvements that allow for Rent Increases (such as new boiler, new roof, new mailboxes). Since these tenants have already signed their renewal leases, will the tenants be obligated to pay the new increases…
The tenants in my building are about to sign new leases that were mailed to them. I plan on doing some capital improvements that allow for Rent Increases (such as new boiler, new roof, new mailboxes).
Since these tenants have already signed their renewal leases, will the tenants be obligated to pay the new increases when the work gets done (assuming I get approval from DHCR and send in form RA-79)? Or will they have the opportunity to reject the increases?
I know that if the apartments were vacant when doing the MCI, I wouldn’t have an issue collecting the higher rents once a new tenant (with a new lease) moves in. But since there are tenants in the apartment currently, does anyone know how it works?
Thanks so much for your input!
I was half joking about not posting here. You can get some good info (or links to where to find it) here, but you also may get misinformation and replies from people who assume you’re an ignorant slumlord. RSA is there to help owners navigate the regulations. Good luck.
– a middle aged landlord
Thanks, I signed up for RSA. Will be pointing my questions to them.
The answer provided by Rosy can also be found in the DHCR fact sheet (which should have been a place you looked for answers rather than here)…
‘… the owner may adjust the rent during the term of an existing lease only if the lease contains a clause specifically authorizing the owner to do so. A satisfactory lease clause would provide as follows: “The rent established in this lease may be increased or decreased by an order of the DHCR or the Rent Guidelines Board.”
http://www.dhcr.state.ny.us/Rent/FactSheets/orafac24.htm
As I recommended in response to your previous post, you should join RSA and take advantage of its resources. You can talk over your questions with an RSA counselor. You can also get copies of RSA’s standard Stabilized Lease (which has the language allowing for increases pursuant to DHCR orders). Use this forum mostly for entertainment.
I have to ask, why are you using a blog to ask these questions? plus, if I remember, didn’t you have issues with collecting rent to begin with? what makes you think that will change with a MCI.
If DHCR approves your application, you may adjust the rent during the term of the existing leases ONLY if the lease contains a clause specifically authorizing you to do so.