Rockrose Joins Ranks of 421a Lawsuit Defendants
Henry Elghanayan is the latest to face a lawsuit alleging rent overcharges tied to the 421a tax program. He has plenty of company.
Tenants at three Long Island City buildings owned by Rockrose Development filed a class-action lawsuit against the developer, QNS reported. The tenants allege their landlord overcharged them by more than $50 million.
The lawsuit centers on three properties: Eagle Lofts, the Linc and Hayden LIC. Residents of the buildings are calling for the overcharges to be refunded and rents to be reset to the net effective base rates originally promised.
The suit follows similar lines to other cases alleging rent overcharges tied to the affordable housing subsidy. Tenants claim the developer was applying increases on rent-stabilized units to the full rent of the apartments and not the preferential rent, which considers concessions such as free months when a lease is initially signed.
The Housing Stability and Tenant Protection Act of 2019 requires rent increases to be applied to preferential rent, not full rent.
Rockrose said at the time of publication that it had yet to be served with the complaint. A spokesperson also said final decisions are still pending on two related cases, one in which a tenant successfully pleaded his case about being overcharged by Rockrose.
The tenants in the class-action case are being represented by Newman Ferrara, a firm that’s identified a niche with these types of lawsuits.
Since August, the law firm has filed class-action lawsuits against at least 12 landlords alleging rent overcharges following concessions at these buildings.
Former Gov. Eliot Spitzer became Roger Sachar’s latest target for allegedly overcharging tenants who received rent concessions at 420 Kent Avenue, an 857-unit building in Williamsburg. Aaron Carr, executive director of the watchdog group Housing Rights Initiative, estimated tenants could be owed as much as $30 million. Carr was also involved in investigating the Long Island City buildings tied to the Rockrose case.
Read more
Meet the law firm that just sued former Gov Eliot Spitzer
Eliot Spitzer’s Williamsburg tenants lodge 421a rent hike lawsuit
The Daily Dirt: A snapshot of building improvements post-2019 rent law
