NCR Properties LP, v. City of Berkeley
Facts: An owner of two single family residences (SFRs) used as rooming housing with each having one uninhabitable floor converts the improvements on each lot into triplexes for a total of six separate dwelling units. Two of the six units were the previously uninhabitable floors. The properties are subject to rent control ordinances which exempt new construction. The city determines only the two units located in previously uninhabitable space are exempt from the rent control ordinance as new construction. The owner seeks to exempt all six of the units as new construction.
Claim: The owner claims all six renovated units are exempt from the ordinance since they are new construction, and the renovations increased the supply of available housing as more units were offered than before.
Counterclaim: The city claims four of the renovated units are not exempt from the rent control ordinance since they were conversions of space used for residential occupancy and not new construction.
Holding: A California appeals court holds the four converted units are not exempt from the rent control ordinance since the space in the existing structure now housing the four units was previously used for residential purposes. [NCR Properties LLC, v. City of Berkeley (2023) 89 CA5th 39]
NCR Properties LP, v. City of Berkeley
Related Reading:
Property Management: Chapter 58: Residential rent control
Legal Aspects : Chapter 16: Covenants, conditions and restrictions
