Ask Sam: How do I find out if my apartment is covered by NYC's Loft Law?
Tenants can investigate whether they are living in a building that doesn’t have a residential certificate of occupancy, and if it qualifies for the Loft Law.
I live in a loft apartment in a mixed industrial and residential building. How do I determine is my apartment is covered by the Loft Law, and what would that mean for me?
The Loft Law has been amended recently, expanding coverage to new neighborhoods, and tenants whose apartments are subject to the law can become rent stabilized, says Sam Himmelstein, an attorney at Himmelstein, McConnell, Gribben & Joseph who represents residential and commercial tenants and tenant associations.
“The Loft Law was originally created in response to the fact that there were tenants living in commercial and industrial buildings, mostly in Soho, that didn’t have residential certificates of occupancy,” Himmelstein says. “This gave them certain advantages, but also made them vulnerable.”
The law, passed in 1982, established a Loft Board, as well as a process of legalization through which these spaces could become residential, rent-stabilized apartments.
Since then, multiple amendments to the law have been passed to allow for more tenants to avail themselves of Loft Law coverage. Tenants in neighborhoods like Williamsburg and Long Island City who are using commercial or industrial spaces in work/live arrangements, for instance, may find that the law applies to them, and they can begin the legalization process.
Tenants can investigate whether they are living in a building that doesn’t have a residential certificate of occupancy, and if it qualifies for the Loft Law. There are some tip-offs this might be the case.
“A landlord might give someone a commercial lease but know the space is being used residentially or the lease might say that the space is for ‘authorized use only,’” says Jesse Gribben, also an attorney at Himmelstein, McConnell, Gribben & Joseph.
For a space to qualify, there are several requirements. It has to be at least 400 square feet, it can’t be located in a cellar, and there must have been three or more tenants in residential occupancy in the building during the one of relevant window periods: those being 2009 to 2010, or 2015 to 2016.
“You have to prove that during one of those time periods, your apartment and two others in the building were being used residentially,” Gribben explains. “The cases we litigate now are focused on the 2009 to 2010, and 2015 to 2016 windows. We don’t know if there will be further amendments to the law allowing for later window periods.”
The Department of Buildings oversees the legalization process, which begins with filing a protected occupancy application with the Loft Board. The cases are then adjudicated by the Office of Administrative Trials and Hearings known as OATH.
“Tenants and landlords bear the burden of proving the building qualifies, that it’s zoned properly, and that it meets all the requirements,” Gribben says. “The process can be somewhat contentious, and tenants often engage their own experts to opine on the best way to legalize the building.”
In many instances, this means the landlord needs to undertake significant renovations in order to secure a residential certificate of occupancy. They may need to install sprinklers and windows and create new means of egress to meet all the safety requirements.
The end result of legalization—which can take years—is that the building will have a residential certificate of occupancy, and the tenants’ apartments will enter rent stabilization.
“Ultimately the goal is to live in a space that is compliant with building codes and rent stabilized,” Gribben says. “But the scope of work needed to legalize a building is so daunting that sometimes landlords drag their heels and tenants have to push it along.”
When a landlord fails to do anything to legalize occupancy, tenants should ask the Loft Board to order legalization, and impose fines and sanctions until the process is underway.
Another option for tenants recognized as protected occupants under the Loft Law is to sell their “rights and fixtures.” This is essentially a buyout: in a sale of fixtures, a tenant who has converted a raw space into a residential one, with walls, partitions, plumbing, lighting, and so on, can make an agreement with the landlord that they will move out if they are paid for the work they did. A sale of rights means the tenant sells their rights as a stabilized tenant, the landlord gets the apartment back, and it becomes a market-rate unit.
“If you rented space as a residential tenant, but you find that the building doesn’t have a residential certificate of occupancy, you should further investigate whether it’s potentially covered under the Loft Law,” Gribben says. “Make an initial inquiry to the Loft Board to get the process started.”
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Sam Himmelstein, Esq. represents NYC tenants and tenant associations in disputes over evictions, rent increases, rental conversions, rent stabilization law, lease buyouts, and many other issues. He is a partner at Himmelstein, McConnell, Gribben & Joseph in Manhattan. To submit a question for this column, click here. To ask about a legal consultation, email Sam or call (212) 349-3000.
