Owner Frequently Asked Questions

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What is the Loft Board?

The Loft Board is a five to nine member Board appointed by the Mayor. The Board, which was established by the New York State Legislature in 1982, regulates the conversion of certain commercial or manufacturing spaces or buildings to lawful residential use. These spaces or buildings, known as interim multiple dwellings, or IMDs, were illegally residentially occupied and fail to meet fire and safety requirements for legal residential occupancy.

The Loft Board administers the Loft Law and the Loft Board’s rules which implement the law. The rules contain the procedures required to legalize IMDs for residential use. The Board’s duties include resolving issues of coverage under the Loft Law, and resolving rent disputes and other problems that may arise between owners and tenants.

The Loft Board also prosecutes IMD owners for violations of the Loft Law and Loft Board rules, including violations of minimum housing maintenance standards.

How has the Loft Law changed since 1982?

The Loft Law has been amended several times. The most important amendments occurred in June of 2010, June of 2013, June of 2015 and June of 2019. These amendments expanded the law’s coverage and raised fines for violations of the law and the Board’s rules. The June, 2015 amendment extended provisions of the law and allowed owners and tenants to register buildings or apply for coverage under the law until June 15, 2017. The Legislature also gave owners of buildings covered under the 2015 amendment additional time to comply with the law.

The June 2019 amendments repealed the June 15, 2017 filing deadline and repealed some of the requirements for coverage. They also created a new window period, January 1, 2015 through December 31, 2019, during which tenants needed to reside in units for twelve consecutive months, in order to qualify for coverage under the law.

What happens after a building or unit is granted coverage under the Loft Law?

The Loft Law and Loft Board rules establish procedures and timetables for the owner to follow in order to legalize the covered units. Tenants have a right to review and comment on the owner’s proposed plans to legalize. Once the plan is approved and certified by the Loft Board, tenants are required to cooperate with the owner’s efforts to legalize.

Do I need a lawyer to represent me?

You are not required to hire a lawyer to represent you, but you may hire a lawyer if you want to.

Can I evict tenants because they live in a commercial or manufacturing building?

An owner cannot evict tenants for living in an IMD unit. The Loft Law allows covered units to remain occupied. However, the owner may try to evict tenants for other reasons.

What happens if City officials issue a vacate order for my building?

The City may issue an order to vacate a building because of hazardous conditions in the building, even if the building is covered under the Loft Law. A tenant protected under the Loft Law who is subject to a vacate order may recover the fair market value of any improvements made by the tenant and reasonable moving costs. When the owner corrects the conditions that caused the issuance of the vacate order, the tenant may have the right to re-occupy the unit and to all of the protections offered by the Loft Law and the Loft Board rules.

What about the rent?

Owners who are in compliance with the Loft Law are entitled to collect rent. However, the amount of rent for the IMD unit is regulated by the Loft Law. This is different from rent control or rent stabilization under other laws.

Section 286(2) of the Loft Law states that the rent charged should be the same rent, including escalations, stated in the last lease or rental agreement if the lease or rental agreement remains in effect. If the lease or rental agreement is not in effect or there is no lease or rental agreement, the rent is the rent most recently paid and accepted by the owner.

Once the owner legalizes a unit by obtaining a final certificate of occupancy for the IMD spaces, the owner must offer the protected occupant a rent-regulated lease subject to the Emergency Tenant Protection Act of 1974.

I heard about something called milestone increases. What are they?

An owner is entitled to increase rents when the owner meets certain compliance deadlines in the Loft Law. We refer to these deadlines as milestones. The milestones are:

  1. When the owner files an alteration application with the Department of Buildings for the legalization work;
  2. When the owner obtains a building permit to perform the legalization work; and
  3. When the owner achieves compliance with the fire and safety provisions found in Article 7-B of the Multiple Dwelling Law.
The owner can demonstrate compliance by filing a certificate completed by the owner’s architect or by obtaining a temporary or final certificate of occupancy for the covered IMD units.

How do I know what the Code Compliance deadlines are?

See the Code Compliance Timetable explaining the Code Compliance deadlines.

How much are the milestone increases?

The amount of the increase depends on when the owner achieved the milestone. The amount is a percentage of the rent the tenant paid on the effective date of the law, including any escalations.

Milestone

Increase: achieved before June 1, 2012

Increase: achieved after June 1, 2012

Increase: achieved after June 25, 2019

Alteration Application

6%

3%

3%

Permit

8%

3%

3%

7-B Compliance

6%

4%

6%

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