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New and Proposed Legislative Development Affect Property Owners

Owners of real property are affected by several recent legislative developments. Landlords with rent-regulated tenants should be aware of the Tenant Protection Act of 2019, which is statewide legislation prohibiting conduct by landlords that is intended to force tenants out of their homes, such as turning off the heat in the winter, exposing tenants to hazardous materials, or conducting unsafe construction on the premises. The new law expands the statutory definition of “landlord harassment” to prohibit intentional conduct designed to force tenants to vacate, with the effect of impairing the habitability of the tenant’s housing, endangering the safety or health of the tenant, or disturbing the tenant’s quiet enjoyment rights. Repeated violations can result in a felony conviction. New York City has also enacted new laws to increase tenants’ protections against harassment by landlords, including measures to stop building owners from using construction work to harass tenants, penalizing building owners for providing false information in DOB submissions, and denying building permits where a residential building has an excessive number of open, immediately hazardous or major construction code violations. The Tenant Protection Act of 2019 has many other provisions, some of which are described in prior issues of this newsletter.

Another new State law prohibits housing discrimination based on the source of a person’s income, as long as the source is lawful. In other words, a landlord may not deny housing to a tenant whose income is sufficient to meet the landlord’s credit requirements because the income is not derived from a salary or hourly wages, but instead from other sources such as Social Security or pension income, disability benefits, veterans’ benefits, child support alimony, or other legally derived non-wage income. Landlords are also prohibited from inquiring into a person’s source of income when that person is seeking to secure housing.

In addition, owners of commercial properties – including cooperatives and condominiums with commercial space – should also be aware of proposed legislation that would introduce commercial rent control to New York City. Under the proposed commercial rent stabilization program, a board appointed by the City Council would set maximum annual lease increases on retail, professional service, and manufacturing storefront space. This would dramatically change the current system under which commercial rents are entirely subject to private negotiation. Although commercial rent control has been discussed for many years, it has never been put to a vote of the City Council in the face of concerns regarding its constitutionality and the potential consequences for the commercial real estate market. However, observers believe that with the current make-up of the City Council and a perceived storefront vacancy crisis, the current proposal may be put to a vote in 2020. Other new laws have also been enacted which have been described in prior newsletters and our new law summary.