Two Trees Management faces class-action lawsuit over alleged rent hikes

Tenants at 300 Ashland Place in Brooklyn have filed a class-action lawsuit against developer Two Trees Management, alleging illegal rent increases. The complaint, brought by the law firm Newman Ferrara in collaboration with the Housing Rights Initiative, claims the company improperly calculated rent renewals.

According to the lawsuit, Two Trees allegedly applied rent increases to the full legal rent of apartments rather than the lower preferential rent offered during initial lease signings, such as when two months of free rent are provided as a concession. The plaintiffs allege this practice violates the Housing Stability and Tenant Protection Act of 2019 and could have resulted in over $30 million in additional rent collected over five years.

The building, a 379-unit complex, receives tax benefits through the 421a program, which requires owners to keep apartments rent-stabilized and adhere to specific increase limits to qualify for millions of dollars in tax breaks.

Two Trees managing director David Lombino has disputed the allegations, calling the lawsuit “entirely without merit” and describing the litigation as “frivolous.” He stated that such legal actions increase the costs of building and operating housing in New York City.