of [the] existing housing accommodation" (NY St Div of Hous & Community
Renewal Operational Bulletin 95-2 at 4). Put another way, the owners "reconfigur[ed]"
the two-bedroom apartment into a four-bedroom apartment, thereby "obliterat[ing] the
prior apartment's particular identity" (Matter of Devlin v New York State Div. of
Hous. & Community Renewal, 309 AD2d at 194; see Matter of Fernandez v
New York State Div. of Hous. & Community Renewal, 3 AD3d at 368;
446-450 Realty Co., L.P. v Higbie, 30 Misc 3d at 72-73).
Moreover, because the rental history of the two-bedroom apartment "is no longer
applicable due to the creation of a new unit"—i.e., a four-bedroom
apartment—"there would be no rational method which DHCR could utilize to
calculate the legal rent" (Matter of 300 W. 49th St. Assoc. v New York State Div. of
Hous. & Community Renewal, Off. of Rent Admin., 212 AD2d at 253).
In fact, this is borne out by the Deputy Commissioner's own determination. Recognizing
that the Marrones were entitled to a rent increase, having added two bedrooms to the
apartment when the petitioner rented it, and apparently unsatisfied that the statutory
formula for a rent increase for increased dwelling space—one-fortieth of the cost
of the improvement (see Rent Stabilization Code [9NYCRR]
§ 2522.4 [a] [1], [4])—sufficiently accounted for the significant
alteration of the subject apartment, the Deputy Commissioner simply picked a number
which he believed constituted a[*6]"reasonable" rent
increase for the unit. Significantly, that rent increase, together with other allowable
increases, brought the legal regulated rent to $1,200 per month, the first stabilization rent
actually charged by the Marrones.
Under all of these circumstances, the Deputy Commissioner's rejection of the