Niche Developers Come Back With Condos

Niche developers in Brooklyn who survived the downturn are coming back with condo developments and new financing. The New York Times took a look at two over the weekend: Daten Group and Brookland Capital. The former is developing 72 Poplar Street, the former police precinct house in Brooklyn Heights. When the former owner had trouble getting approval for its conversion plan during the downturn, Daten bought the property at a discount, and started construction in 2012 with the help of Valley National Bank. The 14 units are skedded to finish up in June with prices starting at $1.7 million.

Developer Boaz Gilad survived the downturn by buying small buildings in short sales using all cash. He recently formed Brookland Capital with a new partner and is working on a bunch of medium size conversion projects in areas from Prospect Heights to Crown Heights to Bushwick, as we’ve reported. One of his projects is 1255 Bushwick Avenue, above, a church, that will be transformed into condos with an addition on the top.

The Times offered that these projects will help “mitigate the inventory shortage”:

Data compiled by the Corcoran Sunshine Marketing Group show that in 2007, a boom year, 8,052 new units opened in the city as planned, but that by 2009 — also known as the Year of No Building — just 497 units opened and a daunting 1,348 were canceled or postponed. In 2012, Corcoran Sunshine calculated that 58 percent of the projects it was working on were conceived before the 2008 market meltdown. But one developer’s setback morphed, as the recovery began, into another’s strategy for scrambling back just in time to deliver a finished product to an inventory-starved market: according to Corcoran’s data, last year 1,132 new units hit the market, with just 136 postponed or canceled, and the projection for this year is 2,500 new units and no cancellations.

Gilad’s new philosophy: “When I buy land, I pay cash. I only build condos. And I only buy in Brooklyn, because Brooklyn is what I know.”

Real Estate Developers Adopt New Approaches [NY Times]