Tenants Of Hoboken Luxury Buildings Learn Rent Increases May Be 3X Legal Rate

HOBOKEN, NJ — Tenants of at least two large apartment complexes in Hoboken this week said their landlords tried to give them rent increases of 20 percent or more — despite the fact that those buildings haven't proven the units are exempt from city rent control laws, which would keep increases to 7.5 percent at most.

One tenant of the Rivington complex on Grand Street, formerly the Curling Club, said that when he went to his landlords to fight a 19 percent increase this year — noting that the city told him his building may fall under rent control — the landlords claimed he'd already signed an exemption.

However, the second paragraph of this rider to Rivington tenants' leases curiously uses language that leaves out Hoboken:

Several sources said that the current owners of the complex, Equity Residential, have been searching for the rent control exemption that the original owners may have signed when the complex was built in 1999. Equity bought the complex for $146 million in 2018.

Hoboken's Rent Control Ordinance is a complex law going back to 1973.

Cities across the country, trying to address the economic situation at the time, passed stabilization laws making sure once a tenant or family was situated, a landlord couldn't raise their rent beyond the cost of living adjustment (usually 2 to 7.5 percent).

New Jersey has the highest number of municipal rent control laws of any state.

Advocates for both landlords and tenants in Hoboken have proposed amendments over the last four decades to modify the local ordinance to allow landlords to maintain the properties, and to make sure tenants aren't harassed out.

Currently, Hoboken landlords can apply to pass along local tax and utility increases to tenants, get a boost for substantial renovations, or get a 25 percent vacancy decontrol every three years if someone leaves voluntarily.

Usually Applies To Older Buildings

Buildings can sign an exemption from rent control for 30 years, so right now, the Rent Control Ordinance largely applies to properties older than 1992.

But apparently, some buildings in town have either been unable to find the exemption document, or have not asked tenants to sign the appropriate addendum citing their exemption when they move in — or both.

In an article in Hoboken Patch last week about tenants being hit with 20 percent or higher increases from the Rivington — and being told that their alternative was to pay $5,000 month-to-month rents — the Rivington responded:

"The Rivington has been, since its construction in 1999, operated as exempt from the city of Hoboken's rent control ordinance. The building was originally constructed in reliance upon the rent control exemption created by New Jersey state law which was intended to incentivize development of projects, like The Rivington, in areas which had previously suffered from a lack of new housing supply. We are currently working through the legal process to clarify this situation."

Buildings like the Rivington typically charge tenants $3,000 or more per unit. Thus, increases of 20 percent or more have been substantial, leading existing tenants to ask questions — which resulted in rulings from Hoboken's Rent Leveling Board.

Since an initial story on the Rivington was published by Hoboken Patch last Wednesday, two tenants of that complex and one tenant of a nearby complex said after that they were hit with large increases, they found out from the city that the increases might not be legal. They were able to negotiate them down, but they still thought the new rent was too high.

And a third Rivington tenant told Patch that he decided to move out because he didn't realize he could fight his increase.

Nebulous Situation In Another Complex

This week, a tenant of 801 Madison St., a luxury building on the west side of town, told Patch that his neighbors have been dealing with a similar situation to those at the Rivington this year.

He said last year, a tenant in his building got what he believed was a high rent increase. So the man asked the city for a legal rent calculation, as all tenants in Hoboken can do.

To the surprise of neighbors, the city responded that his unit may not be exempt from rent control because he hadn't signed a lease saying it is, according documents linked in a March 2022 Reddit thread.

The Madison Street tenant who contacted Patch said that his landlord tried to raise his own rent by $500 a month this year. When he protested, the company said they would put him on a month-to-month lease, he said. But recently, the landlord relented and said he would charge only a few percent increase and give him an annual lease.

"They're trying to get us to sign and everyone else to sign a new lease that has the [rent control exemption] language," said the tenant.

He said he wonders which other buildings in town are trying to push tenants to sign a new lease claiming they are exempt from rent control.

Tenants who are unsure can contact the city's tenant advocate (linked at the end of this story).

Hoboken has a dark history of tenants being burned out and forced out of apartments during the gentrification of the city during the 1980s. As a result, the city has several longtime activists who have become well versed in rent control.

The 801 Madison St. tenant said that he believes new building owners in Hoboken — not small landlords but Wall Street companies — may not be familiar enough with local rent control laws.

Good News And Bad News

A tenant who decided in 2021 to move out of the Rivington said his landlords had told him in November they were raising his rent from $2,800 to $3,600 a month.

When he responded that he'd like to meet in the middle, he got an email from his landlords saying, "I wanted to reach out to you with good news! We were able to lower your offer down to $3528 for a 12 month lease."

He said that when he and his girlfriend ultimately moved out, the company charged them a $743 "insufficient notice fee," according to an email chain he presented, because he let them know within a 60-day window.

He responded to them saying this wasn't fair, because they were still negotiating to lower the increases. Thankfully, he said, the Rivington backed down on the fee.

He moved to another Hoboken complex, he said, where he's happy.

Another tenant contacted Patch last week saying he'd protested his 19 percent increase this year after talking to the Hoboken Rent Control Office.

He said his landlords responded, "The Rivington is not subject to any form of rent control and operates on a market-based value. We're confident the original developer of The Rivington filed the necessary paperwork at the onset of construction; additionally, Page 24 of your lease agreement (attached) specifically states that The Rivington is not subject to Rent Control, and is exempt from future rent control. Given this, the rental prices are based on the market value, rather than local CPI rate."

After agreeing to lower the increase, the landlords wrote, "Please keep in mind that because it is a discounted renewal rate, the lease would need to be signed within 24 hours to keep the price valid."

The man said that he accepted the new rate, which he thought was still high, at 8.3 percent.

"I don't want to move and felt I had no avenue to fight them," he said.

A mother of two kids had told Patch something similar last week, saying that when she pushed back on a large rent increase, the Rivington gave her a compromise but said she had to let them know quickly.

She said she felt the landlords were trying to "strong-arm" people into signing in a hurry.

However, good news came Tuesday for that mother and at least one other Rivington tenant.

The mom showed Patch on Tuesday that she had a new letter from the Rivington dated July 19, saying:

"We believe we have followed the law in good faith and maintain that the building is exempt from rent control pursuant to state law. ... because it may take some time to reach a final resolution, we have decided to amend your renewal offer. We are willing to reduce your renewal lease consistent with Hoboken's published CPI of 6.7 percent for this lease term. if it is later confirmed that we are exempt from rent control, we will then give you the appropriate notice to increase your rent to the market rate."

"I can stay in Hoboken," she said. "Thank you for taking the time to write our story. I truly believe it was the voice we needed to get the help from the city."

The resident of 801 Madison St. mused Tuesday, "All of these buildings are owned by Wall Street. The irony is, the investors in these funds are like pension funds ... they're trying to make more to put into the working people's pension funds. The only people making money are the people running the funds."

State And Local Laws

Meanwhile, the city of Hoboken is considering reducing the rent increases allowed by rent control this year from 7.5 percent to 4 percent (read more here). They are also considering reducing the vacancy decontrol rate to 10 percent, and extending it to five years.

There is no statewide limit on increases, but state law says an increase must be "conscionable" (often 25 percent at most, advocates have said), and there are strict laws saying landlords need "just cause" to avoid renewing a lease.

Have thoughts or tips? Reach out to Hoboken Patch here or comment below.