Preferential Rent? What's the deal?

[Jeremy]

I hope I am giving enough info in this. My building is rent stablized and my roommate has been living in the building for about 7 years.

The rent was 1080. The new lease our LL sent us raised it to 1330. He said that it had to do with preferential rent. This seems like an incredibly huge increase to me. Is there anything I can do? I am already going to talk with him and see if I can bargain him down.

So..my questions are...

1) What is preferential rent? (I have searched the web, but have not found anything that I understand)
2) Do I have any legal recourse in fighting this increase.
3) Has anyone else had this proble.

[citygirlintn]

Here's the basics of preferential rent...

Let's say the maximum legal rent on an apartment is $3000. The LL or management company can choose to negotiate with a potential tenant, and lower the rent to $2500. This is a "preferential rent" and there will be a Preferential Rent Rider in the lease to that effect.

When the lease expires, the LL is legally allowed to raise the rent from the original value (in my example, $3000). If you take a look at your lease, you will probably notice your lease is for a greater amount than the $1080. This is the number the LL is allowed to use to start with. Your rent increase seems so huge, well, because it is.

My guess, though, is if he had given you a preferential rent to begin with, and you want to stay and save him the trouble of finding a new tenant, you will probably be able to bargain with him.