Industry Update: NYS Legislature Advances Bill on LLC Disclosure / Rent Registration

Last month, the New York State Senate passed Senate Bill S119, which would impose new disclosure requirements relating to rent registration statements filed with the New York State Division of Housing and Community Renewal for buildings owned by Limited Liability Companies.

This bill is significant because it broadens the ownership disclosure obligations for LLCs that file annual registration statements with DHCR. Specifically, the bill, if enacted, would require any LLC submitting a registration to DHCR to disclose a list of all “beneficial owners” and each owner’s percentage of interest in the LLC.

The term “beneficial owner” is defined broadly, encompassing individuals who directly or indirectly hold equity interests or who exercise effective control over an LLC’s assets or operations.

If the Assembly approves the bill without amendment, it will be sent to Governor Hochul for signature. Given the Governor’s prior support for the LLC Transparency Act, there is a high likelihood that Senate Bill S119 will get signed into law.

If you own property with rent-stabilized housing accommodations and such property is held by an LLC, we encourage you to contact KMWB to discuss how this legislation may impact you.