In early May, the New York Supreme Court issued a blow to New Ram Realty, (aka Harshad Patel, et al) by siding with the landlord of the Maspeth Holiday Inn Express (KCM Realty Company), located at 59-40 55 Road, in declaring that New Ram's arrangement with the NYC Department of Homeless Services and Acacia Network violated the terms of their land lease. The court:
• "Ordered, adjudged and decreed that defendant New Ram Realty, LLC's renting of rooms at property located at 59-40 55th Road, Maspeth, New York to DHS or another agency of New York City to house homeless persons constitutes a material departure from the use provisions of the lease and a breach of such use provisions; and it is further,
• Ordered, adjudged and decreed that plaintiff KCM Realty Company is entitled to exercise its remedies under the lease; and it is further,
• Ordered, that the motion for summary judgment on the third cause of action is granted on the issue of liability."
In the order, the court pointed out that not only did New Ram breach its contract with KCM, but it also violated the NYC Zoning Code by housing homeless people at the hotel for extended periods of time. On average, each resident of the Holiday Inn Express stayed there for 195 days. The hotel is in a manufacturing zone which allows for short-stay hotels, but not long-term rentals, which are restricted to residential zones. A short-stay is defined as less than 30 days. Many of the hotels being used to house the homeless are in manufacturing zones, meaning that the City of New York has been knowingly violating its own zoning code for years.
The lease is a privately recorded transaction, so we cannot tell you what remedies are listed in it, but this is great news. Citizens for a Better Maspeth,
the organization that fundraised in an effort to fight the proposed shelter and filed a partially successful Article 78, consulted with attorneys to determine if any action could be taken on its part to hasten a vacate of the hotel by the City and Acacia. The attorneys advised against further action at this time.
New Ram has filed an appeal. We'll keep you updated.