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

          -------------------------------------X   ADMINISTRATIVE REVIEW
          APPEALS OF                                             DK430383RT
                    PUN TAI CHAN AND HUI AI ZHAO
                                                   RENT ADMINISTRATOR'S
                                                   DOCKET NO.:  DA430041OM



          The above named petitioner-tenants  timely  filed  petitions  for
          administrative review (PARs) against an order issued on October 25, 
          1989, by the Rent  Administrator  (Gertz  Plaza)  concerning  the
          housing accommodations known as 87-89 Mulberry Street, Apts. 2 and 
          8, New York, NY, wherein the Rent Administrator determined that the 
          owner was entitled to a rent increase based on the installation of 
          a major capital improvement (MCI).

          The  Commissioner  deems  it  appropriate  to  consolidate  these
          petitions for disposition since they pertain to the same order and 
          involve common issues of law and fact.

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

          The owner commenced  this  proceeding  on  January  3,  1989,  by
          initially filing an application for a rent increase based on  the
          installation of a new roof at a total claimed cost of $7,520.00.

          Various tenants responded to the application  urging  the  denial

          On October 25, 1989, the Rent Administrator issued the order here 
          under review finding that the installation qualified as  an  MCI,
          determining that the application complied with the relevant  laws
          and regulations based upon the supporting documentation submitted 
          by the owner, and allowing appropriate rent  increases  for  rent
          regulated tenants.

          ADMIN. REVIEW DOCKET NOS. DK-410311-RT; DK-430383-RT

          In these petitions, the tenants contend, in substance, that a new 
          roof had not been installed but, approximately two years ago, two 
          men spent several hours splashing tar  on  the  roof  to  prevent
          leakage; that the owner is attempting to collect an increase for an 

          improvement that was not made; that the owner  has  not  produced
          copies of the installation bills at the tenant's request (Apt. #8); 
          that the DHCR is urged to reconsider the order herein; and that it 
          is unfair that the tenants should have to pay for necessary repairs 
          which should be the sole responsibility of the owner.

          After a careful consideration of the entire evidence of record, the 
          Commissioner is of the opinion that  these  petitions  should  be

          Rent increases for major capital improvements are  authorized  by
          Section 2522.4 of the Rent Stabilization Code for rent stabilized 
          apartments.   Under  rent  stabilization,  the  improvement  must
          generally be building-wide; depreciable under the Internal Revenue 
          Code, other than for ordinary repairs; required for the operation, 
          preservation, and maintenance of the structure; and replace an item 
          whose useful life has expired.  The installation of a new roof is 
          generally considered to qualify as a major capital improvement.

          A review of the record indicates that notice of the application was 
          sent to all the tenants by the DHCR  on  March  24,  1989,  which
          elicited  three  tenant  responses.   Both  petitioners  were  in
          possession of their respective  apartments  when  notice  of  the
          application was sent.  Since said notices were not returned by the 
          U.S. Post Office marked undeliverable as addressed, it is presumed 
          that the tenants herein received said notice but failed to respond 
          in the proceeding below  with  objections  relevant  to  the  MCI
          installation herein.

          Moreover, the record confirms that the Rent  Administrator  acted
          properly in granting the MCI rent increase herein  based  on  the
          owner's submission of all the required documentation including the 
          contract, and cancelled checks substantiating the installation of 
          a new roof.

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

          ORDERED, that these petitions be, and the same hereby are, denied, 
          and that the Rent Administrator's order be, and the same hereby is, 


                                                         Joseph A. D'Agosta
                                          2             Deputy Commissioner

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