Brookfield, LeFrak call portions of emergency rent law unconstitutional, sue state

Two institutional-level city landlords who collectively own tens of thousands of apartments in the city, Brookfield Properties and LeFrak, filed separate but similar lawsuits yesterday alleging portions of the state’s Covid-era rent relief program were unconstitutional as well as plagued with delays.

Brookfield and LeFrak allege the state Emergency Rental Assistance Program, as administered by the NYS Office of Temporary and Disability Assistance, prevents them from commencing nonpayment cases in part because the state has not made decisions about whether the applicant deserves the rent relief. The landlords are seeking orders vacating the automatic stays on nonpayment proceedings, among other relief.

“The COVID pandemic has taken a tremendous toll on New Yorkers all across the state, and they need rental assistance now,” former Governor Andrew Cuomo said in a statement at the time of the launch of this program in 2021. “To streamline this process, I’ve directed [the Office of Temporary and Disability Assistance] to work with their vendor to disburse payments as quickly and efficiently as possible [so] we can deliver billions of dollars in rental assistance to New Yorkers who have been struggling to pay rent due to no fault of their own.”

These lawsuits comes less than a month after another legal challenge to what landlords see as aggressively restrictive and poorly implemented regulations. In the prior series of suits Michael Shah of Delshah Capital, Jason Glick of GPG Properties and Ben Shaoul of Magnum Real Estate Group, alleged the city’s Certificate of No Harassment designation as it applies to their Manhattan and Brooklyn rental properties is arbitrary and capricious.

LeFrak alleges that 22 tenants in 15 buildings have not paid rent yet holdover proceedings have been stayed due to the tenants’ application or appeals for the state Emergency Rental Assistance Program. The state has not made a determination in these cases if the relief is warranted. “Tenants ERAP Applications or ERAP Appeals have not been processed, and some have been pending for more than one (1) year. Despite the fact that some ERAP Applications reflect that they have been provisionally approved, Petitioner has not received any payments for the above listed Respondent Tenants… The stay provision of the ERAP Law is unconstitutional because it violates Petitioner’s right to due process under the United States and New York State constitutions as well as the principle of separation of powers.”

Brookfield Properties alleges the tenants of this unit in 2 Blue Slip in Greenpoint, Brooklyn, who signed a lease in August 2020 for $7,500 per month, have accrued back rent of more than $150,000 and that they filed an emergency rent action which stayed nonpayment proceedings. The complaint alleges the state is not ruling on the emergency rent relief application in part because one of the tenants did not file all the required documents. The petition is seeking an order that that state make a determination on the tenant application and lift the nonpayment stay.

LeFrak alleges unpaid rent from the 22 tenants currently totals $535,856. Brookfield alleges the tenants in that one unit owe $150,816.

Attorneys from Borah, Goldstein, Altschuler, Nahins and Goidel filed both petitions.

LeFrak petition LINK
Brookfield petition LINK

Direct link to the property’s ACRIS page and link to DOB NOW portal.