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Horizontal Multiple Dwellings (HMD) or When Two Buildings Are One

On Behalf of | Mar 19, 2013 | Rent Stabilization |

In order for an apartment to be subject to rent stabilization, along with a number of other criteria, it must be located in a building that contains six or more apartments.

Could two seemingly separate buildings that are commonly owned and managed and also share certain essential services like heat, water and electrical services be considered one building in which all the apartments in both buildings are added together to achieve the magic number of six?

The answer, to the shock and dismay of the landlord, is yes. The shock comes from the realization that apartments thought to be unregulated are now regulated and the dismay is that rents may be lowered, rent overcharges paid and renewal lease offers mandated. The doctrine that brings the two buildings together as one is a finding that they are part of a horizontal multiple dwelling (HMD).

In a recent decision, SREP 10th Avenue Venture LLC v. Walters, obtained by our Firm, Judge Sabrina Kraus of the Civil Court ruled that two buildings on the corner of 10th Avenue and 22nd Street, each containing three apartments, with separate entrances were an HMD because they have been commonly owned and managed for over forty-years and shared a heating system, water supply and electrical services. The building are on the same tax Block and Lot, have one mortgage and one insurance policy. The Court’s decision falls squarely within accepted HMD case law.

The take away here is that if you live in one of the many small buildings found in the Village, Chelsea, Soho, etc., look around, see if your connected, you may be rent stabilized.

William J. Gribben

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