NYC alleges ‘bait and switch business practices’ by Extra Space Storage in new lawsuit

Uncontrolled rat infestations, thousands of dollars lost in destroyed items, misleading advertising and unnoticed rate increases are just some of the issues Extra Space Storage renters have dealt with for years, according to a lawsuit filed Tuesday by the New York City government.

The civil action is the first filed by the city’s Department of Consumer and Worker Protection (DCWP) against a self-storage company, and comes as the agency pledges to be more aggressive in its efforts to hold the industry to account. 

Filed a few months before Local Law 171 is set to come into effect in August, which will require all self-storage facilities operating in the five boroughs to be licensed by the city, the department said the suit was in line with its efforts to rein in these “pervasive” practices from self-storage companies, as well as its “citywide crackdown on junk fees that inflate prices for consumers and undercut honest businesses,” following Mayor Zohran Mamdani’s January executive order. 

The department claims that it has received more than 100 consumer complaints against Extra Space Storage, which operates roughly 60 self-storage locations throughout the five boroughs. Its goal, the department said, is putting a halt to the storage provider’s “deceptive bait-and-switch scheme” of allegedly luring customers in with false promises of lasting low rates that are quickly raised and recovering “full restitution” for consumers impacted by changing prices and destroyed property. 

“This lawsuit aims to … send a clear message to the self-storage industry that exploiting New Yorkers comes with serious consequences,” said DCWP Commissioner Sam Levine in a statement. “[F]alse advertisements, hidden late fees and predatory practices are on our radar. The era of exploiting New Yorkers is over.” 

Mayor Zohran Mamdani recently appointed Levine, a former Federal Trade Commission regulator who worked under commission chair Lina Khan, to lead DCWP.

When asked for comment, Extra Space Storage said it was “aware” of the city’s suit.

“The company is actively conducting a comprehensive internal review to accurately assess the claims mentioned in the complaint,” a spokesperson told amNewYork Law.

The suit alleges the storage provider has been breaking city law since at least 2018 by engaging in deceptive trade tactics. Extra Space has been falsely advertising clean, sanitary and low-cost storage spaces, falsely guaranteeing 30 days’ notice before increasing prices, not providing itemized receipts and falsely advertising the size of units, contract length and consumers’ access to stored items on its website, the complaint alleges. 

Examples of this, the city’s suit says, are plentiful: There’s Alex Rodriguez, who rented a unit in The Bronx to store items he planned to sell for his online business, as well as clothing and toys belonging to him and his son. It wasn’t long, the suit says, before Rodriguez began seeing rats in his unit, smelling an unpleasant odor on the majority of his items —  including electronics, speakers, stereo systems, electric bikes, and many other items he planned to offer for sale through his online business in his unit —  were ruined by the rodent infestation. 

Rodriguez estimates property damage of over $100,000. Another renter, Donna La Forey, reports approximately $10,000 in property damage — including two televisions, a mattress and bed frame, a sofa, treasured collectibles, laptops and her husband’s work equipment for his construction business — from flooding in the storage center, which she said Extra Space told her didn’t impact her unit.

Others, like Enrique Capalbo, report being drawn in by low rental rates that quickly increase with no notice, despite advertising that told them that wouldn’t happen. Capalbo’s unit was initially advertised at $236 per month — he’s currently paying $440 each month, and has never been notified ahead of the frequent rental increases, which began after only one month into his contract.

The suit details the experience of over a dozen other renters, whose rates increased astronomically with no warning — despite Extra Space’s website assuring customers it’s “not like” other self-storage providers who increase their prices without warning.

“Extra Space’s consistent tactics of luring consumers in with low rates, only to quickly raise rents drastically and without notice, has left many consumers feeling cheated and helpless,” the complaint reads. 

The city also charges Extra Space has prevented customers from accessing their belongings and threatened to auction off clients’ items to “extort” payment of unexpected charges, like “undisclosed junk late fees” for allegedly delayed payment.

If successful, the suit could require Extra Space Storage to pay between $150 to $3,500 for each violation of city law — which, according to the complaint, could be over 2,000 — forbid the storage provider from advertising false claims on its website and require it to honor its contractual terms and representations regarding the 30-day advance notice for rental price increases and contract lengths.

In a statement, DCWP noted the suit fell into its “Fee Free February” campaign to crack down on predatory business practices, which it describes as its latest action in a push by the Mamdani administration to ensure consumers aren’t taken advantage of by businesses. 

Last month, DCWP issued a final rule prohibiting hotels from imposing excessive charges often disguised as “destination fees” or “resort fees,” as well as hidden holds on credit cards. The agency also filed a lawsuit against solar panel installation company Radiant Solar and its owner for deceiving consumers and embedding undisclosed “dealer fees,” seeking at least $1,752,225 in civil penalties and approximately $18 million in restitution. 

“DCWP will continue to aggressively enforce the law against junk fees across industries—holding bad actors accountable and restoring trust, fairness, and transparency in the economy,” the department said in a statement.