Tenants at an East Village building owned by Kushner Companies will not have to pay rent until the real estate firm secures a certificate of occupancy for the building, a housing court judge has ruled.
Residents of the building at 331 East 9th Street will also be allowed to stay in their apartments without paying any back rent, according to the decision that Judge Frances Ortiz handed down Tuesday. The decision comes as the city continues to grapple with the deepening coronavirus crisis, which last week prompted New York state to halt all eviction proceedings.
The nine-unit East Village property is one of several that Housing Rights Initiative and Bronx Councilmember Ritchie Torres announced Kushner was operating illegally at a press conference last March.
The property was built around 1900, meaning it was exempted from the city’s certificate of occupancy requirement, according to HRI. However, after buying the building in 2013 for $20.25 million, Kushner Companies added a floor to build luxury penthouses, a substantial alteration that meant the property would now require a certificate of occupancy, HRI said.
Ortiz agreed with this in his ruling, writing that “the addition of an entire floor on the top of the building constitutes a substantial alteration, thereby requiring petitioners to obtain a C of O for the entire building.” He added that “no rent is collectible by the petitioner [Kushner] when a building lacks a valid certificate of occupancy.”
The real estate company never received a permanent certificate of occupancy because of building code violations, according to HRI. The housing watchdog group helped the building’s tenants organize and refuse to pay rent.
Kushner Companies COO Peter Febo said in a statement that Ortiz’s ruling is “wrong” and “based on a lack of understanding of DOB regulations.” He maintained that because the building was constructed before 1938, it “therefore does not require a CO.”
“At the moment our primary focus is helping our residents during the Covid-19 crisis,” he continued. “Courts are currently closed, and we plan to appeal the decision as soon as they re-open.”
HRI and Uta Winkler, the lead tenant in the case, attempted to get the Department of Buildings to enforce the laws that Kushner Companies had violated, but the agency refused, according to the organization.
“The only thing worse than the unlawful business practices of Kushner Companies is the failed enforcement practices of the Department of Buildings,” HRI founder Aaron Carr said in a statement.
Robin LoGuidice, the attorney who represented Winkler in the case, echoed Carr’s comment.
“Judge Ortiz’s decision exposes a developer’s complete disregard for their tenants’ safety,” she said in a statement, “facilitated by the NYC Department of Buildings’ failure to enforce their own code.”
DOB spokesman Andrew Rudansky said in a statement that the agency “was not a named party in this housing court case, and we don’t comment on civil litigation between private parties.”
The DOB audited 331 East 9th Street in 2018 and issued a stop work order on the property due to false filings on work applications, according to the agency. It has not received any public 311 complaints on the building since 2018, and Kushner Companies’ most recent temporary certificate of occupancy for the sixth floor apartment will expire on May 5, the DOB said.
Febo noted in his statement that Winkler “has not paid rent in over two years and is in arrears in excess of $75,000.”
Multiple groups have called for a rent moratorium across the board in New York City as the coronavirus pandemic wreaks havoc on the nation’s economy. Mayor Bill de Blasio said on Friday that he supports and will pursue the idea. Torres recently said that he has tested positive for Covid-19.