Open Thread

I’d’ve thought a leafy residential enclave desirable.

$350 per square foot!? Has anything sold for that low?

Goldman Sachs’ Brooklyn condo bet sours
By Amanda Fung

Published: August 13, 2009 – 2:22 pm

Forté, a 30-story luxury residential tower in the Brooklyn Academy of Music cultural district in downtown Brooklyn, is underwater.

Manhattan-based developer The Clarett Group confirmed Thursday that, along with its majority partner Goldman Sachs Group Inc., it is negotiating with the project’s construction lender to transfer control to the lender. After two years of marketing, the 108-unit, upscale FXFOWLE Architects-designed building is only 37% sold.

“Clarett is proud to have delivered such a beautiful, high quality property—on time and on budget—to enhance the skyline and contribute to the renaissance of downtown Brooklyn,” the developer said, in a statement. “Unfortunately, the sales market in Brooklyn has not been as strong as Forté itself.”

The number of apartment sales in northwest Brooklyn, which includes downtown and Fort Greene, fell 42.8% during the second quarter from the same time last year, according to the Prudential Douglas Elliman and Miller Samuel industry report.

Clarett Group declined to elaborate on the proceedings. But sources say that lender Eurohypo Bank, Germany’s largest real estate bank, has hired The Witkoff Group as an asset management advisor to explore its options. Eurohypo holds approximately $41 million in debt on the tower. Goldman Sachs is the majority equity investor in the project with a 75% stake. Prudential Real Estate Investors is also an equity partner. PREI and Goldman declined to comment.

Meanwhile, units at Forté remain for sale. Earlier this year, Clarett Group hired Brooklyn-based The Developers Group to take over Forté’s marketing. The developer was previously handling sales in-house.

Attempts to package up units and market them in bulk have gone nowhere, according to sources. It could not be determined which firm was handling the bulk sales, but many noted that there have been no takers, in part because of the building’s location at 230 Ashland Place, between downtown and the leafy residential enclave of Fort Greene Hill.

Previously sold individual units at Forté went for an average $681 per square foot, according to Streeteasy.com. Sources say the few investors active in the market today are unwilling to pay over $350 per square foot.

Clarett Group is recognized for developing a number of luxury residential towers across the city including The Montrose and Chelsea House, both in Manhattan. Recently, the developer topped off downtown Brooklyn’s tallest building, dubbed The Brooklyner, located at 111 Lawrence St. The 51-story tower will offer 491 one- and two-bedroom apartments for rent. Clarett said it expects that building to be open to residents by early next year.

are lavalieres those ghetto legoes that were included in the gift bags!?

*rob*