A socioeconomic shift has led to Brooklyn becoming “Manhattanized,” according to a Massey Knakal third quarter recap and two reports we received in our inbox last night. This is not the first time the real estate firm has used that word, but now it goes into much more detail about it and forecasts the trend will continue.
The firm doesn’t see any slack coming at the end of the year. “We expect dollar volume in 4Q14 to exceed 3Q14,” and rents and prices to continue to increase, said one of the reports.
The reports outlined three reasons for the continued “Manhattanization” of Brooklyn:
• Big time institutional investors jumping into the market
* New, higher quality, bigger building stock
* Price appreciation in Williamsburg and other areas has closed or exceeded the Manhattan gap (more…)
Three big developers have snapped up a crumbling Williamsburg factory for $18,300,000, Crain’s reported, paying a near-record price in hopes of building condos on the site. Adam America, Naveh Shuster and Slate Property Group recently bought the large, L-shaped property at 304 North 7th Street. It faces the BQE and has close to 200 feet of frontage on both Meeker Avenue and North 7th Street, for a total of 22,325 square feet.
The final sale price works out to $432 per buildable square foot, for a property that could accommodate up to seven stories and 60,278 square feet of development. The lot last changed hands for $9,450,000 two years ago, meaning that the previous owners flipped it for nearly twice what they paid.
The developers are confident about the condo market, an exec from Slate said. Condos in Williamsburg are relatively scarce, with 256 condos in development versus 3,725 rentals, according to TerraCRG data quoted in Crain’s. TerraCRG brokered the deal.
The development trio is also working on several other projects in Brooklyn, including large developments at 535 4th Avenue, 470 4th Avenue, and 275 4th Avenue, as well as a six-story rental in the Broadway Triangle. And just a block away, Adam America is building two seven-story buildings housing 169 units at 247 North 7th Street.
Spruce Capital Partners wants to flip the recently opened Colony 1209 in Bushwick, asking $81,500,000 for the five-story luxury rental building at 1209 Dekalb Avenue, according to The New York Observer. Spruce bought the 127-unit development in April from developer Read Property Group for $58,000,000. Rents are high for Bushwick, ranging from $1,775 for a studio to $2,975 for a two-bedroom at Colony, where amenities include a “speakeasy,” a gym, screening room, common roof terrace and a shared backyard.
The building’s marketing team has caught some flak for the name of the building and its marketing copy, which bills the development as “homesteading, Bushwick-style” and a place where one can find “like-minded settlers.” The building is located in an area of Bushwick that has been densely residential for more than 100 years, and is lined with 19th century row houses and mansions, not a “vibrant industrial setting,” as the copy claims. Massey Knakal is marketing the 120,000-square-foot building, which has 41 parking spaces and 12 years left on a 421-a tax abatement.
A gas station at 1508 Bushwick Avenue, shuttered and in foreclosure, is for sale. Auctions for the property were scheduled three times in 2012 but there is no record of a sale since 2007, when it traded for $1,250,000.
It sits on a major thoroughfare with heavy traffic, catty corner to the Bushwick Aberdeen L stop. On the empty lot across the street, Scarano Architects is designing a storage facility.
Metro Industrial Realty Inc. is repping the site, according to a sign on the property, but we couldn’t find a listing or price online.
The lot is 10,000 square feet with only that much buildable square feet. It is classified as a toxic site, according to PropertyShark. Zoning is C8-1 (auto-related commercial and industrial), and housing is not permitted.
The long-stalled apartment development turned parking lot at 510 Driggs Avenue in Williamsburg sold for $25,000,000 in September, according to public records. Last month, we published this rendering for the site designed by ODA Architecture, which apparently cannot get enough of unevenly stacked boxes.
The buyer is developer DHA Capital, according to the deed. Curiously, Crain’s reported in September that a different developer, Alliance Private Capital Group, said it had purchased the site for $35,000,000.
A development as large as 70,0000 square feet could be built on the property between North 8th and North 9th streets. That works out to $357 a buildable square foot for the DHA deal, or $500 a buildable square foot for Alliance — which would be one of the highest prices ever paid for a Williamsburg development site, according to Crain’s.
A Mobil gas station at 185 Flatbush Avenue Extension in Downtown Brooklyn is now on the market and asking $27,000,000, which shakes out to $425 per buildable square foot, Crain’s reported. Zoning allows a building as large as 63,400 square feet on the triangular site bounded by Johnson and Gold streets. With an affordable housing bonus, a development could be up to 76,000 square feet and house 75 apartments.
Any developer who purchased it would likely build condos or a hotel to justify the asking price, Crain’s pointed out. Most likely a developer would have to decontaminate the site as well before starting construction. CPEX, which is marketing the property, included the rendering above to show what a potential development there could look like.
The 6,300-square-foot plot, which is across the street from the Oro condos at 306 Gold Street, last changed hands for $604,918 in 2011, according to public records. So this is quite a leap.
Developer Madison Realty Capital has snapped up a factory in Clinton Hill for $23,500,000, and may be planning rentals or condos. Although the building at 551 Waverly Avenue is on one of those industrial looking blocks between Fulton and Atlantic near Hot Bird, it’s zoned for residential. The firm hasn’t yet revealed its plans, according to The Real Deal and The New York Daily News, which both wrote about the sale. The current tenant is a 68-year-old kosher bakery that has occupied the building for more than a decade, said the Daily News.
The three-story building (which looks like two) has about 43,000 square feet, but more than 90,000 square feet would be allowed. It dates from 1915, according to city records. It has 90 feet of frontage on the street, so we could imagine stores on the ground floor would work.
Do you think this sale will start a transformation of this corner of Clinton Hill into apartment buildings?
Italian developer Est4te Four — the same folks behind gorgeous and fast-selling 160 Imlay — closed on $33,000,000 worth of Red Hook properties last month, and now we have renderings of what they plan to do with it, courtesy of New York YIMBY. They intend to convert the large brick warehouses on Coffey and Ferris Streets to offices and build new five- and six-story buildings with brick on the bottom and glassy top floors, according to the rendering.
They want to demolish the site’s “less attractive” warehouses, such as the Daily News’ old printing press building. NBBJ is designing the project, which is bounded by Coffey, Ferris and Wolcott Streets and the waterfront. It will also include a waterfront promenade. Altogether it will have 1.1 million square feet of office space.
Click through to see more renderings of the office development. What do you think of the design?
As anyone strolling the streets of Brooklyn might guess from the frenzied pace of building in the borough, commercial real estate in Brooklyn has reached new heights. Institutional investors, big players previously interested only in Manhattan, are now buying and selling in the borough, and the dollar volume of commercial sales in the first six months of this year is nearing the numbers for the entire year of 2013, according to a story in The Real Deal. It’s the “Manhattanization of the investment sales market,” according to a Massey Knakal executive quoted by the paper.
The number of deals increased dramatically in the first six months, with the dollar volume of deals completed equal to $3,400,000,000 — vs. $3,800,000,000 for all of 2013, according to numbers from Massey Knakal quoted in the story. There were 1,086 commercial sales in Brooklyn in the first six months of this year, an increase of 14 percent over the same period in 2013.
Not surprisingly, most of the activity was in Williamsburg, where 31 development sites traded hands in the first six months. But, surprisingly, Bed Stuy was hot on its heels, with 27 sites changing hands. Greenpoint hit third place, and Crown Heights was fourth, with 18 deals.
The average price of a deal was $3,000,000, according to TerraCRG. But there were some big sales above $30,000,000 — TerraCRG estimates 25 or 30 such deals will have closed during the first six months of the year. (In 2011, there were only three deals above $30,000,000.)
The sale of a stake in Atlantic Yards to Greenland and Fort Greene’s 470 Vanderbilt topped the list of the borough’s biggest deals — click through to the story to see the 10 biggest. Sales are still booming, according to sources, but running out of property or new restrictions concerning tax abatements or inclusionary housing could put a damper on the market, said The Real Deal.
One thing developers are not worried about is rising interest rates. “There is still so much money out there. The market will continue. I don’t think there are any clouds on the horizon,” investor Stephen Steiner of Stratus Capital Advisors told the paper.
Another Brooklyn gas station has been snapped up for development, this one in Clinton Hill. A developer, The Daten Group, bought 840 Fulton Street, at the corner of Vanderbilt Avenue, for $7,400,000 on September 30, according to the Commercial Observer.
The firm plans to build a seven-story mixed-income rental building. The 40,000-square-foot development will have 38 apartments, 20 percent of which will be affordable. There will be 5,000 square feet of retail in the project, which is scheduled to begin construction in March 2015 and finish two years later. KBA Architects will design the building, which will cost approximately $20,000,000 to build, said the story. The Daten Group’s management company, Vibe Living, will manage and market the rentals, and Douglas Elliman will handle the initial leasing campaign.
The deal included 3,464 square feet of air rights from a neighboring property at 848 Fulton Street, which is a four-story building with apartments and a Thai restaurant on the ground floor. The sale has not yet hit public records. The developer hasn’t filed any demolition or new building applications yet either.
A now-vacant lot at 359 7th Street in Park Slope just sold for $1,860,000, or $453 per buildable square foot. The sale was brokered by Ariel Property Advisors, which said in a release that the price per buildable square foot was a record for the neighborhood. The unnamed buyer plans condos, said Ariel. The 20.5 foot wide, 100 foot deep lot can accommodate a 4,100 square foot building.
The previous owner, an LLC, bought the site in August of 2012 for $1,250,000. At the time the lot had was home to a frame house built sometime before 1899. The application to demolish the building was approved in December of that year. The transaction has not yet hit public records. Click through to see a photo of the frame house that was torn down.
Photo above by Google Maps; photo below by Nicholas Strini for PropertyShark (more…)
Rabsky Group, a partner in Read Property’s gigantic Rheingold development in Bushwick, has picked up 12 mostly empty lots close by, according to public records. Rabsky paid $53,000,000 for the 12 residentially zoned lots on Bushwick between Montieth and Forrest streets. One of the sellers was Read Property; the other one was Princeton Holdings, according to a story in The Real Deal.
No addresses were given for the parcel in the story, but the group is filed in public records under 501 Bushwick Avenue. The ramshackle block consists mostly of empty lots and parking lots across from a car wash and the Rheingold Gardens affordable housing complex. It is also not far from the Bushwick Houses public housing complex on the corner of Flushing and Bushwick.
Current zoning (R6a) will limit development here to six or seven stories.
Read and Princeton still own properties covering the remaining quarter of the block, as well as more lots across Montieth Street. Bushwick has been roaring with construction since the summer, and development of these properties will further transform this side of Bushwick.