[RPPTL LandTen] Renovations and Pricing Issues

[Jariel Bortnick]

Group:

An interesting question arose today that I think I know the answer for but
wanted to pose to the group first. I apologize for the somewhat lengthy
fact pattern.

The landlord purchased an older student-oriented apartment complex next to
a college campus and is renovating units in bunches as they become vacant.
When the landlord purchased the complex over the summer, several units were
vacant (as students leave town for the summer) but already had been
pre-leased for the 2015-2016 school year.

Despite the fact that all of the units were already pre-leased for the
2015-2016 school year at prices that wouldn't reflect the market rate for
renovated units, the landlord went ahead and renovated the vacant units
over the summer and turned them over to the new tenants that moved in this
month (this was done so that the landlord would have some "model units" to
show future prospects what the renovated units would look like). The new
tenants of those renovated units that just moved in are paying the rent
amount that they had agreed on with the prior owner, before any renovations
were contemplated.

Now, other tenants with unrenovated units are seeing that some of their
friends are paying the same price for renovated units and are complaining
to the landlord. The landlord has given some of these complaining tenants
the option of signing a new lease at a slight discount to market rent,
temporarily vacating the unit for the 2-3 months that the renovations would
take to complete and then moving back in (at which time the new lease would
commence). Now, the complaining tenants are trying to raise the Fair
Housing Act and claiming discrimination to force the landlord into doing
the renovations but only charging them the "unrenovated" price afterwards.

Any thoughts on this slightly unusual fact pattern would be greatly
appreciated.

Thanks!

-- 
Jariel Bortnick, Esq.
561.703.1155
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