Understanding Good Cause Eviction Law

The AKAM webinar on Good Cause Eviction outlined new limits on evictions, requiring specific “good causes” and excluding certain unit types from these rules. Rent increases upon renewal are capped at 8.82% due to the CPI limit, with several exemptions for different types of properties. Notices must clearly state if Good Cause Eviction applies and include reasons for any exemptions. Owners should document all rent increases and concessions thoroughly, comply with notice requirements, and stay updated on legal developments and court rulings to navigate this evolving framework effectively. 

Understanding Good Cause Eviction

• Host: Gil Maman, with guests Sherwin Belkin and Jeff Goldman (founding partners of Belkin Burden Goldman, LLP) and Adam Hirsch (Vice President of New Development, Commercial & Multifamily Management​, AKAM Northeast). 

• Focus: Discussing the new Good Cause Eviction (GCE) law. 

Overview of Good Cause Eviction 

1. General Framework 

• Limits evictions to specific “good causes.” 

• Tenants can no longer be evicted without cause at the end of the lease term. 

• Applies to free-market units, not rent-controlled or stabilized units. 
   

2. Reasonable Rent Increases 

• On renewal, rent can be increased by the lesser of 10% or CPI + 5%. 

• The current CPI is 3.82%, making the maximum increase 8.82%. 
   

3. Exemptions 

• Rent-controlled and rent-stabilized units, affordable and income-restricted units, co-ops, condos, new construction (TCO or C of O after Jan 1, 2009), owner-occupied buildings with 10 or fewer units, small portfolios (10 units or fewer), and luxury units (specific rent thresholds). 
   

4. Notice Requirements 

• Notices must be attached to all leases, rent demands, and termination notices. 

• Notices must inform tenants if GCE applies and the reasons for exemptions if it does not. 
   

5. Good Causes for Eviction 

• Including nuisance, breach of obligations, failure to pay rent, and failure to provide access. 
   

6. Challenges and Ambiguities 

• Many unclear aspects will be decided by courts. 

• Issues include how rent concessions are treated, exemptions based on TCO/C of O dates, and rent increase calculations for multi-year leases. 
   

Practical Takeaways 

• Documentation: Owners should thoroughly document rent increases, expenses, and reasons for concessions. 

• Notice Compliance: Ensure notices are properly attached to avoid legal challenges. 

• Stay Informed: Monitor legal updates and court decisions for further clarity on GCE provisions. 

• Business Decisions: Evaluate the risk of aggressive vs. conservative interpretations of the law. 

Q&A Highlights 

• Subletting: Subletting tenants can claim GCE protection if the tenant intends to return. 

• Fractional Ownership: Ownership interests in portfolios are scrutinized to determine GCE applicability. 

• Rent Increases: Debate on whether rent can be increased beyond the 8.82% threshold on vacancy leases. 

• Court Backlog: GCE is expected to increase litigation and delays in housing courts. 

Conclusion 

• To effectively navigate this evolving landscape, owners and managers must adapt to new GCE requirements, keep detailed records, and stay updated on legal interpretations.