What is amount that rent on a commercial lease can be raised at one time?

Full question:

I bought a co-op in 1998 and another in 2002 in the same building. Last October (2008), we where advised by the co-op board that our land lease rent was going up around 115%. My wife and I were shocked. I went back and checked my closing statements. There was a disclosure stating that we had a land lease which we new about, but nothing stating anything about a rent increase on the land lease. I spoke to a number of other shareholders to ask if they were advised of the increase when they bought. All said that they were and given a disclosure showing the increase stating the land lease would go up as of January 2009 at fair appraised value plus 8%. My lawyer never advised us of this. I called my lawyer and asked him for a copy; he told me I should have a copy in my closing statement. I told him I did not and for him to send me a copy. It has been 2 weeks and I haven't received it. I have emailed him a number of times without receiving a reply. What can I do? I did a quick calculation to see what this will cause me over the time of the lease. It comes to about $700,000.

• Category: Landlord Tenant
• Date: 04/07/2025
• State: New York

Answer:

Where an apartment is not subject to rent stabilization or rent control or other rent regulation, a landlord is free to charge any rent agreed upon by the parties and a rent increase may occur upon renewal of the lease. If the apartment is subject to such rent regulation, the rent and subsequent rent increases are set by law. A tenant may challenge the regulated rent with the DHCR. If the challenge is upheld, DHCR will order a refund of any overcharges plus interest and, where appropriate, it may assess penalties.

Landlords of rent stabilized buildings may seek rent increases for certain types of building-wide major capital improvements (MCI), such as the replacement of a boiler, and for new services, new equipment or improvements to an apartment in accordance with the law and regulations. Under certain circumstances, a landlord may also apply for a hardship rent increase.

Landlords must provide tenants with a written receipt when rent is paid in cash, a money order, a cashier's check or in any form other than the personal check of a tenant. Where a tenant pays the rent by personal check, (s)he may request in writing a rent receipt from the landlord. The receipt must state the payment date, the amount, the period for which the rent was paid, and the apartment number. The receipt must be signed by the person receiving the payment and state his or her title. (Real Property Law § 235-e)

State laws do not require a proposed property increase to be included in the disclosure of property condition required by law. The requirement of advance notice of a rent increase are generally a matter of contract law and depend on the terms of the contracts involved.