OFFICE OF RENT ADMINISTRATION 
                                     GERTZ PLAZA
                               92-31 UNION HALL STREET
                              JAMAICA, NEW YORK  11433


          APPEAL OF                               ADMINISTRATIVE REVIEW
                                                  DOCKET NOS:ARL11953-L
          R.    Giurdanella/Fraclac    Realty              D.R.O.    DOCKET


          MODIFYING          RENT           ADMINISTRATOR'S           ORDER

          On July  18,  1986  the  above  named  petitioner-owner  filed  a
          Petition for Administrative Review against  an  order  issued  on
          June 27, 1986 by the Rent Administrator, 92-31 Union Hall Street, 
          Jamaica, NY concerning housing accommodations known as Apartments 
          9 and 10, 43 East 11th Street, New York, NY.

          The Commissioner has reviewed all of the evidence in  the  record
          and has carefully considered that portion of the record  relevant
          to the issue raised by the administrative appeal.

          This proceeding was commenced on March 11,  1985  by  the  tenant
          filing a complaint based on the  owner's  failure  to  renew  the
          lease on the same terms and conditions as the prior  lease  which
          commenced December 1, 1982 and expired November  30,  1984  at  a
          monthly rental of $330.88.

          The tenant indicated  that  he  took  occupancy  of  the  subject
          premises on December 1, 1979 but was not named as a tenant in the 
          lease until December, 1980.  The tenant submitted a copy  of  the
          owner's  renewal  offer  which  advised  the  tenant   that   the
          passageway between Apartments 9 and  10  had  to  be  closed  and
          afforded the tenant the option of accepting a renewal  lease  for
          either Apartment 9 or Apartment 10.

          In answer to the complaint, the owner alleged that  Apartments  9
          and 10 were separate units that were  rented  in  December,  1977
          under one lease to two prior tenants who were given permission to 
          make an  opening  between  the  apartments  and  that  the  prior
          tenants advised that  the  opening  would  be  closed  when  they
          Docket No. ARl11953L          - 2 -

          vacated. The owner further alleged that when the  subject  tenant
          took occupancy in December, 1979  the  owner  believed  that  the
          apartments  were  separate  units,  that  separate   registration
          statements were filed for each in 1984 and that upon  discovering

          that the passageway had not been closed, it notified the  subject
          tenant that the passageway had to be closed prior  to  signing  a
          renewal lease for the two apartments.

          The tenant subsequently advised that  the  owner  had  offered  a
          renewal lease that included surcharges for each  apartment  which
          the tenant did not accept. 

          In Docket  No.  L-001937-RV,  issued  June  27,  1986,  the  Rent
          Administrator determined that the subject  tenant  was  occupying
          the subject apartments  as  an  integral  unit  and  not  as  two
          separate apartments, that the owner consented to  this  usage  by
          executing the lease commencing December 1, 1982 in  the  tenant's
          name, that the  owner  was  not  eligible  for  the  differential
          (referred to by the tenant as a  surcharge)  allowed  under  Rent
          Guideline Order  No.  16,  that  the  renewal  lease  was  to  be
          calculated on the base rent of $330.88, i.e., the rent  indicated
          in the expired  lease,  and  that  the  registrations  should  be
          modified accordingly.

          The Rent Administrator further directed the owner"to offer to the 
          tenant, within 30 days of this order, a renewal lease for one  or
          two years, at the tenant's option.  The tenant shall be  afforded
          60 days to accept such offer and select  an  option.   The  lease
          shall commence on the day a fully executed copy  is  served  upon
          the tenant and shall run prospectively for the term  selected  by
          the tenant.  The rental provided therein shall be at  the  lawful
          guidelines increase in effect and otherwise on the same terms and 
          conditions as provided in the expiring lease, except as otherwise 
          provided in the Code."

          In this petition, the owner  contends  that  while  it  may  have
          agreed to rent the subject premises to  the  subject  tenant,  it
          never intended to give up its rights as the owner of  each  unit,
          that the subject tenant had agreed to close the passageway at the 
          expiration  of the December 1, 1982 lease and that the  owner  is
          holding in  escrow  money  received  form  the  tenant  for  that
          purpose. The owner further contends that  the  commencement  date
          of the renewal lease it was directed to offer the  tenant  should
          be reconsidered.

          In response, the tenant asserts that while he agreed  to  provide
          the owner funds to close the passageway, said agreement is not an 
          admission that he had rented separate units. The tenant maintains 
          that the premises have been rented to him as a single unit  under
          a single lease since his initial occupancy  and  that  the  owner
          failed to offer a lease consistent with his previous lease.

               Docket No. ARL11953L     - 3 -

          The Commissioner is of the opinion that this petition  should  be
          denied and the Rent Administrator's order modified. 

          The  evidence  of  record  shows  that  the   subject   premises,
          Apartments 9 and 10, have been  occupied  by  the  tenant  as  an
          integral unit and were rented as such by the owner under a single 
          lease at a single rental amount.   Having  previously  agreed  to
          joint occupancy of the apartments  by  the  subject  tenant,  the
          owner cannot unilaterally terminate such occupancy.  Accordingly, 
          the Commissioner  finds  that  the  Rent  Administrator  properly

          ordered the owner to  offer  the  subject  tenant  a  prospective
          renewal lease on the same terms and conditions  as  the  tenant's
          expired lease.

          Section 2523.5 (c) of the Rent Stabilization Code (effective  May
          1, 1987), made applicable to pending petitions filed after  April
          1, 1984 by Section 2529.10, provides:

               "Where the owner fails to timely offer a  renewal  lease  or
               rental agreement in accordance with subdivision (a) of  this
               section, the one or two year  lease  term  selected  by  the
               tenant shall commence at the tenant's option, either (1)  on
               the date a renewal lease would have commenced had  a  timely
               offer been made or  (2)  on  the  first  rent  payment  date
               occurring no less that 120 days  after  the  date  that  the
               owner does offer the lease to the tenant.  In either  event,
               the effective date of the increased rent under  the  renewal
               lease  shall  commence  on  the  first  rent  payment   date
               occurring no less than 120 days after such offer is made  by
               the owner, and the guidelines rate applicable  shall  be  no
               greater than the rate in effect on the commencement date  of
               the lease for which a timely offer should have been made".

          The record shows that the owner has failed  to  comply  with  the
          Rent Administrator's order to offer the tenant a  renewal  lease.
          Therefore, the owner is directed to offer the  tenant  a  renewal
          lease within 30 days of the issuance of this order.   The  tenant
          shall have the option of selecting a one or two year lease and be 
          given 60 days to exercise a choice.

          In accordance with Section 2523.5 (c), the renewal  lease  to  be
          offered pursuant to this order must commence  (since  the  tenant
          has rejected a lease retroactive  to  1984)  on  the  first  rent
          payment date no less than 120 days after the owner's offer  of  a
          prospective lease.  The guideline rate shall be no  greater  than
          the rate in effect on December 1, 1984 (the commencement date had 
          a timely renewal offer been made), i.e., no greater than 6%for  a
          one year lease or 9% for a  two  year  lease.   Since  the  owner
          failed to comply with  the  similar  order  issued  by  the  Rent
          Administrator, the Commissioner hereby emphasizes  that  if,  for
          example, the owner offers the tenant a renewal lease 15 days from 
          the issuance of this order, then the earliest starting date would 
          Docket No. ARL11953L

          be the first rent payment date at least 135  (15+120)  days  form
          the issuance of this order.

          THEREFORE, in accordance with  the  Rent  Stabilization  Law  and
          Code, it is 

          ORDERED, that this petition be, and the same hereby  is,  denied,
          and the Rent Administrator's order be, and the  same  hereby  is,
          affirmed as modified by this order and opinion.


                                             ELLIOT SANDER
                                             Deputy Commissioner

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