Property Management

In New York City, a building owner who performs major capital improvements (MCI) to a rent-stabilized building may apply for a rent increase. This increase is:

AA one-time increase equal to the full cost of the improvement divided among all tenants
BA permanent increase to the legal regulated rent approved by DHCR, calculated based on the cost of the improvement divided by the number of units and amortized over a set period
CA temporary surcharge that expires after 10 years under the HSTPA 2019✓ Correct
DOnly applicable in buildings with fewer than 6 units

Explanation

Under the HSTPA of 2019, Major Capital Improvements (MCI) increases are now temporary surcharges rather than permanent increases to the base rent. They are amortized over 12 years for buildings with 35 or fewer units and 12.

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