- Glossary
- /Major Capital Improvement (MCI)
NYC rental glossary
Major Capital Improvement (MCI)
A building-wide capital upgrade that lets a landlord apply for a permanent rent increase on rent-regulated units, subject to caps.
A Major Capital Improvement is a building-wide upgrade that benefits all tenants — a new boiler, roof, elevator, or windows, for example. When a landlord makes a qualifying MCI, they may apply to the state for a permanent increase to the legal regulated rent of every regulated unit in the building, spread out and capped to limit the burden on any single tenant.
The 2019 HSTPA reforms sharply curtailed MCIs: the increase is now capped at a low single-digit annual percentage, amortized over a much longer schedule, and the surcharge expires after a set number of years rather than living in the rent base forever. MCIs in distressed buildings and certain neighborhoods face additional limits.
An MCI sits beside an IAI (the apartment-level analog) as one of the two ways a regulated rent can legally rise above the RGB order. Both are bounded; pricing software has to apply the ceiling and the expiry, not just add the surcharge.
Related terms
- Individual Apartment Improvement (IAI)An in-unit renovation that lets a landlord add a capped, time-limited increase to a rent-regulated apartment’s legal rent.
- Rent StabilizationA NYC regulatory system that caps annual rent increases and grants tenants a near-automatic right to renew their lease.
- Legal Regulated RentThe maximum lawful rent for a rent-regulated unit, registered with the state and built up from a base plus permitted increases.
- HSTPA (Housing Stability & Tenant Protection Act)The sweeping 2019 New York law that reshaped rent regulation, ending vacancy deregulation and capping improvement increases.
- DHCR (Division of Housing & Community Renewal)The New York State agency that administers rent regulation — registering legal rents and adjudicating overcharge complaints.
- Rent Guidelines Board (RGB)The nine-member NYC board that sets, once a year, the maximum percentage a rent-stabilized rent may be raised on a one- or two-year lease.
This definition is general information about a New York City rental or rent-regulation concept, not legal advice. The rules change and often turn on facts specific to a building, unit, and tenancy — confirm the current rule and consult a qualified attorney before acting on any individual matter.