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Understanding Good Cause Eviction Law

  • 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. 
     
  1. 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%. 
     
  1. 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). 
     
  1. 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. 
     
  1. Good Causes for Eviction 
  • Including nuisance, breach of obligations, failure to pay rent, and failure to provide access. 
     
  1. 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. 
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