Queens Tenants Bring Rare Court Challenge To State Housing Agency Over Approvals of Landlord’s Illegal Rent Increases

QUEENS, NY (May 24, 2024) – On Friday, residents of a group of rent-stabilized buildings in Jamaica announced their filing of Article 78 motions against the New York Division of Homes and Community Renewal, (DHCR) seeking to force the agency to finally review and make decisions on their appeals of the landlord’s unjustified rent increases.

The tenants have been waiting three years for decisions from DHCR, which has allowed the notorious landlord Zara Realty to inflate rent based on fraudulent claims of major capital improvements (MCI) to the buildings.

“Some of the MCI work was totally unnecessary and actually harmful for tenants, and done without the permission of DHCR, like changing the intercom and lock, which left us unable to get into our building,” said Moreom Perven, a resident of 88-15 168th St. “The law says that is not allowed. But unfortunately, it seems like DHCR doesn’t care about tenants or the law, they only care about making it easy for landlords to get more money.”

View the Article 78 court filing here.

“It’s time for DHCR to answer for failing to respond to tenants, especially when landlords are using the major capital improvement process as a means to illegally inflate rent at rent-stabilized buildings,” said Johnny Thach, a staff attorney with Legal Services NYC, which is representing the tenants. “Tenants have been forced to drain their savings and fixed incomes to cover fraudulent rent hikes from a known slumlord-style landlord. DHCR needs to do its job and issue the right decisions for these tenants.”

The tenants’ landlords, Zara Realty, have raised rent by hundreds of dollars in the past decade, saying that so-called improvements to the building justify these increases. The DHCR has rubber-stamped these requests from Zara, in direct opposition to tenants’ needs and the facts, allowing landlords to drive up the cost of living and squeeze working class New Yorkers.

In reality, Zara has barely updated the buildings at all, and inflated their construction costs in some cases by millions of dollars for a single job. Tenants allege that they have used these false improvement claims to force tenants out, displacing hundreds of longtime neighborhood residents and reducing the city’s stock of affordable housing. The firm already faces a lawsuit from Attorney General Letitia James, for allegedly violating rent stabilization laws.

“[DHCR] let Zara charge us MCIs for millions of dollars even though Zara itself tells the Department of Buildings that the work cost them only ten percent of that,” continued Perven, of 88-15 168th St. “Not only that, some MCI work seems to have been incomplete and deficient like pointing and waterproofing. So not only are they inflating costs, they also leave portions of the building undone, old, cracked, exposed to elements, so tenants often have leaks from bad work. Every single Zara building is going through the same pattern. If tenants are recognizing Zara’s systemic abuse, then how come DHCR is failing to recognize this? Zara only sees tenants as money making machines. Zara is the clear example of the abuser of the system. and that is why they are being sued by the Attorney General. And DHCR is the enabler. We filed appeals more than 3 years ago but DHCR is still making us wait while we bleed all our money.”

“DHCR has improperly approved countless MCI increases of hundreds of dollars per month across Zara buildings, displacing hundreds of families over the years, despite the fact that Zara’s MCI applications have been riddled with discrepancies and violations,” said Doug Ostling, a resident of 140-50 Ash Ave. “Tenants have appealed these bad decisions but have been waiting on decisions on their appeals for as long as seven years! We are done waiting. We are here today to announce our lawsuit against DHCR to force the agency to finally make decisions on our appeals of these unjustified rent increases.”

“I have been living here since 2000 and I am a cancer survivor, a disabled person and a single mother. My only source of income is my SSI benefit, which is almost nothing for now! I am using almost 80% of my income only for my rent,” said Nahida Begum, a resident of 140-60 Beech Ave. “You can calculate how tight my financial situation is based on my income. I am barely surviving. Now in my building, Zara has filed for not just one, but two MCIs. Most tenants in these buildings are like me, living month to month on limited income. If DHCR approves these MCIs, I would have an increase of $200 in my rent! That is basically an eviction for me.”

“Rent stabilized tenants living under the Zara brand have endured too many years of unjustified rent increases,” said State Senator John Liu (D-Queens). “Unfortunately, these rent hikes, often performed under the guise of Major Capital Improvements, have been continually rubber-stamped by DHCR. We are calling on DHCR to do the right thing and allow tenants a chance to appeal these improvement claims and for the courts to order rent reductions and reimbursements that are fair to tenants.”

“We have seen this show before— a landlord, in this case, Zara Reality— trying to unlawfully raise rents by filing Major Capital Improvement (MCI) applications with the NYS Department of Homes and Community Renewal (DHCR), the state agency that oversees rent-stabilized buildings in New York,” said State Assemblymember Ron Kim (D-Queens). “I implore the DHCR to follow the letter of the law and deny the Zara application because it will have deleterious effects on these tenants. “

Tenants are demanding that the DHCR review their requests to appeal these improvement claims — and are calling on the court to order rent reductions across the board and reimbursement of tens of thousands of dollars in rent payments.

Tenants rallied in front of the DHCR’s offices in Jamaica, Queens, alongside attorneys representing them, and the Offices of State Senators Jessica Ramos, Leroy Comrie, Toby Ann Stavisky and John Liu and the Office of State Assembly Member Ron Kim.

Tenants are residents of 150-01 88th Ave; 150-03 88th Ave; 150-05 and 150-07 88th Ave; 150-09 and 150-11 88th Ave; 150-01 to 150-11 88th Ave; 88-05 171st St; 162-20 89th Ave; and 88-15 168th St, 140-30 Ash Ave, 140-50 Ash Ave, and 140-60 Beech Ave, Queens, New York.

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Legal Services NYC fights poverty and seeks racial, social, and economic justice for low-income New Yorkers. For over 50 years, LSNYC has challenged systemic injustices that trap people in poverty and helped clients meet basic needs for housing, income and economic security, family and immigration stability, education, and health care. LSNYC fights every day to ensure New Yorkers and their families have access to the services, resources, and protections they need to survive. http://www.legalservicesnyc.org/