The Real Deal New York

Thousands of FiDi apartments could be re-regulated after court ruling on 37 Wall Street

January 08, 2010 04:51PM

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A New York City Housing Court judge has ruled that a market-rate apartment at 37 Wall Street should be rent-stabilized because the owner has been receiving 421-g tax abatements from the city. The decision, reminiscent of last year’s Stuyvesant Town case, in which the state’s highest court ruled that landlord Tishman Speyer had illegally deregulated units while receiving J-51 tax abatements, could mean a return to rent-stabilization for thousands of Financial District apartments. Unlike the J-51 tax break, which was issued to developers throughout the city, the 421-g was given out exclusively to commercial landlords in Lower Manhattan for residential conversions. The landlord at 37 Wall Street, W Associates, had argued that because the rent was over $2,000, the building should be exempted from stabilization. “As the Court of Appeals concluded in Tishman Speyer, [the owner]
cannot take advantage of the luxury deregulation exclusion of the Rent
Stabilization Law while simultaneously receiving benefits under the
program,” Judge Bruce Scheckowitz wrote in his decision. According to the Downtown Express, there are at least 16 rental buildings below Murray Street currently receiving 421-g tax abatements, including 200 Water Street, 63 Wall Street ant 90 West Street. The decision sets a precedent for similar lawsuits from tenants in close to 5,000 units in those buildings. [Downtown Express] and [Crain's]

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