MADISON MURRAY ASSOCIATES v. PERLBINDER

While we do not subscribe in every respect to the IAS Court's construction of the lease, particularly its determination that statutory tenancies are not encumbrances as a matter of law, we agree with its conclusion that to interpret the appraisal provision as not requiring consideration of statutory tenancies would result in an inflated valuation making the annual renewal rental nearly three times the net lessee's income from the building, thereby rendering the renewal option illusory, and is plainly unreasonable.

Concur — Murphy, P.J., Rubin, Ross, Williams and Tom, JJ.