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January 29, 2007
Sterling Place Co-Op
My wife are seriously considering a Co-Op (our first step in home ownership) in a pre-war Crown Heights building. Right now its 21% owner occupied with the remaining units filled with renters. Our realtor has promised us that the sponsor will have building fully owner occupied within the next 2 years.
The asking price is incredibly low for the sqft-age. Should we risk it? Would you risk it?
Comments
Right off the bat, anything the broker tells you about the sponser can't be trusted. Speak to the board or the managing agent. Even if they tell you it's true, you still can't count on it, since the sponser can change his mind. Despite that, it's by taking a risk like this that a good investment can be made. Then again, a coop in Crown Heights will probably never be a gold mine.
Posted by: Anonymous at January 29, 2007 2:00 PM
Where on Sterling Place?
Posted by: anon in crown heights at January 29, 2007 3:20 PM
Nope i would not buy into a building that is mostly renters absolutly not. No matter what anyone says.
Posted by: Anonymous at January 29, 2007 3:30 PM
Why?
Posted by: bknysrfr at January 29, 2007 3:34 PM
The Co-Op is on Sterling and New York Avenue.
Posted by: bknysrfr at January 29, 2007 3:37 PM
Ditto about not trusting the what the sponser or the agent says. The sponser of my building said he was putting in a laundry, three years later still waiting. Questions to ask: Is there a co-op board or is the board the sponser? Who is renting out the apartments, owners or the sponser. If it is owners renting, the board can make rules about subletting. If it is the sponser you can do nothing to him, he can do whatever he wants. That is generally what it says in the propertary lease. If the sponser is the board, then you have to have elections, hire a lawyer, etc to get control of the building. Renters do not take care of the building the same way as owners. They do not have the same stake. For example, the running toilet is no big deal to them, but when the co-op gets the outrageous water bill the board gets to deal with it and the added costs. It is a risk and you and the other owners will have to work for the rewards.
Posted by: Alisa at January 29, 2007 4:36 PM
i don't think it's so crazy, but then again i already live in Crown Heights.
i agree with the first response above - you'll get more accurate information from the board or management company than from the broker. that said, i really doubt the 2-year horizon for becoming fully owner occupied. the landlord probably plans to sell off units as renters' leases end. however it is likely that some tenants are rent-controlled, and depending on their incomes, rents and whatnot, they could continue to rent for many years still. you may want to find out how many tenants are rent controlled.
if it's a nice apartment, if you can afford to fix it up (assuming that's part of why it's cheap), and if you won't mind living there for 10 years while the neighborhood continues to change and properties continue to appreciate, then it's probably just fine. if you don't think you would want to live there that long, check into the co-op's sublet rules, or get yourself on the board and have some input in the matter.
one other thing to check is, if you require financing, whether a bank will give you a loan with the owner-occupancy at only 21%. many banks require a much higher percentage than this. luckily you wouldn't need a very big loan.
again, as the first poster said, risks like this can lead to a good investment. if i didn't already own a house and were in the market for an apartment, yes, i absolutely would consider a large apartment in Crown Heights North at that price. Crown Heights North is a beautiful area!
Posted by: anon in crown heights at January 29, 2007 4:39 PM
Thanks for all your comments, this forum rocks!
I got that real "Brooklyn" feeling when we visited the area last weekend. That feeling you were out of the city, but not in the country. Being the center of the borough, I may start calling it the heart of Brooklyn :).
speaking of heart, does anyone know any thing about the schools on New York Ave and Park?
Also how do I get leasing information on the buildings tenants?
Posted by: bknysrfr at January 30, 2007 9:44 AM
The schools over there are not so hot and 21% does not bode well - nor does the cheap price (you get what you pay for, or even less in real estate). I would keep looking. If this is your first purchase you want to get something that has a good chance of appreciating so you can trade up in a few years.
Perhaps you could find something in a better location. The Clinton Hill co-ops are a great value. I know there are a couple of good apartments available there. Check Craigslist. Good luck!
Posted by: clinton hillbilly at January 30, 2007 11:52 AM
I predict values will continue to grow in Crown Heights for the next few years. And it's a great community to boot. But for your specific situation it's critical that you speak with the coop board and find out directly from them whether -- and how -- they plan to increase owner occupancy. Just be aware that the downside is usually a very strict no subletting policy which can become a financial burden on owners if/when the market turns down. Agree with everyone here that you can't take the sponsor's word at face value.
Posted by: NeoGrec at January 30, 2007 12:42 PM
You may also have trouble getting financing at 21% occupancy. Do not believe a word the broker says. This sounds like trouble to me. Don't forget, all the pain in buying a co op will be revisited upon you when you want to sell it.
Posted by: phoffy at January 30, 2007 1:54 PM
This sounds like the building my co-worker lives in. She bought in when there were even fewer owner occupants. She's now on the board and I have great faith that her tenacity will turn things around a lot faster now. Plus the demand for the area has gone up and the sponsor is much more willing to liquidate than they had been in the past. I have some sense of the apartment layouts; this seems like a nice building. I think it was done by the same designer who did mansion House in Brooklyn Heights.
Posted by: Anonymous at January 30, 2007 5:02 PM
Sounds like we need to speak with some owners. If anyone in this forums is owner at 960 Sterling, please contact me.
thanks!
Posted by: bknysrfr at January 31, 2007 2:04 PM
That sounds like my building. I am the vice president and would be happy to give you more information. Since there is a lot going on at the building it would be easier to speak to you.
Tell me how to contact you.
Posted by: Anonymous at February 1, 2007 6:57 PM
Great, can you email me at: michael@brooklynsurfer.com
cheers!
Posted by: bknysrfr at February 2, 2007 11:23 AM
What does "that sounds like my building mean" ?
There is nothing ambiguous about 960 Sterling Place
you either "vice president or not" of this building
Posted by: rainchild at March 29, 2007 2:35 PM
If there are any owners, recent purchasers, or executive members willing to chat with a prospective buyer (i.e. me), please let me know!
Posted by: Won't UB MY Nabor at April 1, 2007 11:34 AM
check the police blotter.. I think a man was shot in that building.
Posted by: guest at December 12, 2007 4:20 PM
Hello,
I found this forum because I am seriously considering purchasing a co-op in 960 Sterling Place. I am wondering if Michael, you did purchase in the building, and if so, how is it? Has it worked out for you? I am particularly concerned about apartment noise. Does that seem to be a problem? Like, is there a lot of loud music, etc?
Also, I'd love to chat with the person who is the Board Vice President. You can contact me at sbcoady@aol.com.
Thanks,
Elizabeth
Posted by: guest at June 26, 2008 9:52 PM
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