Judge Bruce Scheckowitz of New York City Housing Court has denied a motion by attorneys for W. Associates to reargue a case in which he ruled last December that the company had illegally deregulated a unit at 37 Wall St. while receiving special tax abatements.
In his latest ruling, which, according to an article today by Daniel Massey at therealdeal.com, Mr. Scheckowitz found that the landlords' interpretation of the law "eviscerated" the end of the law, which is known as 421-g, tax abatements that were created by the city in 1995 to encourage commercial landlords to convert buildings in the Financial District to residential use.
Under the statute, individual building owners could receive as much as $40 million in savings in the form of reduced property taxes. Some 80 buildings are currently receiving the tax benefits, city records show.
According to the article, "There is no dispute that by enacting [the 421-g tax breaks the legislature intended to confer rent stabilization coverage to dwelling units in buildings receiving tax benefits under this program," Mr. Scheckowitz wrote, adding that "The legislature decided to pass along the benefit of reduced taxes to the tenants in the form of rent stabilization coverage."
The article said that Serge Joseph, the attorney for 37 Wall St. tenant Maverick Scott, said that "as many as 5,000 units could be returned to rent stabilization as a result of the ruling."
Kevin Smith, an attorney for W. Associates, the article continued, "said he had not had a chance to discuss the judge's ruling with his client, but that he would recommend appealing the initial decision. A notice of intent to appeal has already been filed."
In his ruling, Mr. Scheckowitz wrote that as the Court of Appeals decided in the landmark Tishman Speyer case involving the Stuyvesant Town/Peter Cooper residential complexes that an owner cannot take advantage of luxury decontrol while receiving tax breaks, but the article said that Mr. Smith has argued that that "the 37 Wall St. case is different because the law does not specifically mention 421-g abatements."
In his latest ruling, which, according to an article today by Daniel Massey at therealdeal.com, Mr. Scheckowitz found that the landlords' interpretation of the law "eviscerated" the end of the law, which is known as 421-g, tax abatements that were created by the city in 1995 to encourage commercial landlords to convert buildings in the Financial District to residential use.
Under the statute, individual building owners could receive as much as $40 million in savings in the form of reduced property taxes. Some 80 buildings are currently receiving the tax benefits, city records show.
According to the article, "There is no dispute that by enacting [the 421-g tax breaks the legislature intended to confer rent stabilization coverage to dwelling units in buildings receiving tax benefits under this program," Mr. Scheckowitz wrote, adding that "The legislature decided to pass along the benefit of reduced taxes to the tenants in the form of rent stabilization coverage."
The article said that Serge Joseph, the attorney for 37 Wall St. tenant Maverick Scott, said that "as many as 5,000 units could be returned to rent stabilization as a result of the ruling."
Kevin Smith, an attorney for W. Associates, the article continued, "said he had not had a chance to discuss the judge's ruling with his client, but that he would recommend appealing the initial decision. A notice of intent to appeal has already been filed."
In his ruling, Mr. Scheckowitz wrote that as the Court of Appeals decided in the landmark Tishman Speyer case involving the Stuyvesant Town/Peter Cooper residential complexes that an owner cannot take advantage of luxury decontrol while receiving tax breaks, but the article said that Mr. Smith has argued that that "the 37 Wall St. case is different because the law does not specifically mention 421-g abatements."
Architecture Critic
Carter Horsley
Since 1997, Carter B. Horsley has been the editorial director of CityRealty. He began his journalistic career at The New York Times in 1961 where he spent 26 years as a reporter specializing in real estate & architectural news. In 1987, he became the architecture critic and real estate editor of The New York Post.
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