Lawsuit: Rent at Kushner properties inflated illegally
NEW YORK – Tenants of a second building owned by the company of Jared Kushner’s family filed a lawsuit Tuesday over rent that they say is inflated illegally.
The lawsuit in state Supreme Court in Brooklyn filed by six residents at 18 Sidney Place in Brooklyn alleges that Kushner Cos. is charging much higher free-market rent, rather than the rent-stabilized rate required by law.
The Kushner Cos. said it has done nothing wrong.
“We’ve reviewed the lawsuit and believe it is without merit and that we have complied with all rent regulations applicable to the apartments,” said spokeswoman Christine Taylor.
The case follows a lawsuit filed in August by nine residents of another Kushner building in Brooklyn. Both cases were filed the law firm Newman Ferrara. The firm is seeking class action status for both cases.
Jared Kushner stepped down as CEO of the Kushner Cos. earlier this year before he became a senior adviser to his father-in-law, President Donald Trump. He has divested from many properties in his portfolio, but still owns both the buildings at the center of the two lawsuits, according to his latest financial disclosure reports filed with federal ethics officials.
The lawsuit on Tuesday alleges that tenants at all the units at 18 Sidney Place should have been charged rent-stabilized rates. It alleges that there are probably more than 75 former and current residents who were charged too much in the nearly four years since Kushner Cos. bought the building.
Housing Rights Initiative, the nonprofit tenant advocacy group that is behind both Tuesday’s lawsuit and the earlier one, put out a press release saying the Kushner Cos. has “brazenly and systematically” exploited tenants, and called for New York Governor Andrew Cuomo to open an investigation into dozens of its buildings.
Apartments at 18 Sidney Place had been temporarily exempt from rent stabilization laws under its previous owner, the Brooklyn Law School, according to the lawsuit. Under state rules, certain landlords who don’t rent to the public but use units to house employees or students can apply for exemptions.
The Kushners bought the building in February 2014 and listed units to rent by the public, but they failed to inform tenants that they were entitled to lower rent-stabilization rents, the lawsuit alleges.
The company has also drawn scrutiny for its management of multifamily apartments. In October, it confirmed that it is cooperating with a request from the Maryland attorney general for information about its operations in the state following media reports critical of its treatment of tenants at apartments it owns there.
The Kushner Cos. was sued in September by two tenants of Maryland properties alleging that it had charged them illegal fees. The company had denied the charges and said it will fight the lawsuit.
The Kushner Cos. has been on a buying spree in recent years, including several buildings in Brooklyn. The company says it has struck more than $2 billion in deals in two years.