Real Estate Market

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Almost 40 years ago, the writer Pete Hamill wrote an article in New York magazine declaring Brooklyn “the sane alternative” to Manhattan. “Art galleries are opening. Neighborhoods like Bay Ridge and South Brooklyn now have boutiques and head shops. People who have been driven out of the Village and Brooklyn Heights by the greed of real-estate operators are learning that it is not yet necessary to decamp for Red Bank or Garden City. It is still possible in Park Slope, for example, to rent a duplex with a garden for $200 a month, a half-block from the subway; still possible to buy a brownstone in reasonably good condition for $30,000, with a number of fairly good houses available for less, if you are willing to invest in reconditioning them.” This week, Hamill returns after a long hiatus in Manhattan, and finds, not surprisingly, that Park Slope is fancyland, and that some things have been lost in its transformation. “Today, there are dozens of real-estate offices along Seventh Avenue and more on Fifth Avenue, and many houses were going for $2 million and more,” he writes. The people he sees on 7th Avenue “are in their twenties, most of them gym-thin. Shoulder bags hang from their shoulders while other bags form humps on their backs. Their thumbs flick across tiny keyboards. They talk into cell phones. They never make eye contact with anyone, as if adhering to some paranoid manual of New York behavior. Instead, they glance into restaurants, hurry past art-supply stores, dress shops, delicatessens, heading to places that are provisional, not permanent, parts of their narrative. They rent.” Hard to buy when the places are $2 million, of course. He’s not completely nostalgic for the old, old neighborhood, though, the one that was dangerous. As he says, “Gentrification is better than junkies.”
Brooklyn Revisited [New York]
Sunset. Photo by arimoore.

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Here’s a letter from an established real estate investment firm in the city to its investors that landed in our inbox yesterday. It’s quite an interesting snapshot of where the various parts of the market stand, especially when it comes to financing. Of course, it was penned before yesterday’s failed vote.

Although many of you may have experienced extreme difficulties and declines in your stock portfolios and the newspapers report daily on the dire problems with the housing market, our experience in the real estate rental business and the New York coop and condo market is not so extreme. Generally speaking our tenants continue to pay their rents and business continues in a more or less normal fashion. Although we are seeing more delinquencies than usual across our portfolio and we are carrying a greater number of residential vacancies than last year, it is fair to say so far the effects we have seen have been more consistent with a typical downturn in the economy and not more dramatic than that.

Given the current situation in the credit markets, we do anticipate having a more difficult time when seeking refinancing quotes, but we expect to be able to successfully resolve our various financing requirements. So far, our lenders have been negotiating normal mortgage extensions on appropriate market driven terms and at the moment, we do not foresee a problem in this area at least through the end of 2009…This is not to say we have not faced any problems with certain of our properties. We have found it difficult or impossible to arrange debt for new development and/or condominium conversion projects. The market is very reluctant to finance for-sale housing projects. As a result, we have put several new construction or conversion projects on hold and will continue to do so until the market returns to a more normal situation. In one case we even cancelled a deal and took a loss on our contract deposit rather than accepting inferior and expensive financing that would have strained our resources in an inappropriate manner.

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342 Bedford Avenue
760-s.f. one-bed, one-bath
Original listing: 3/11/08; $675,000
Reduced price as of 9/28: $600,000
Listed with The Developers Group

162 16th Street #8C
927-s.f. two-bed, two-bath
Original listing: 10/10/2007, $725,146
Reduced price as of 9/24: $675,000
Listed with Aguayo & Huebner

935 Pacific Street #401
1,210-s.f. three-bed, three-bath
Original listing: 5/2/07; $900,000
Price as of 9/27: $799,000
Listed with Elliman.

384 Maple Street #3A
1,834-s.f. four-bed, 2.5-bath
Original listing: 11/03/2007, $741,000
Reduced price as of 9/24: 569,000
Listed with Aguayo & Huebner

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We included 2777 Bedford Avenue in our Open House Picks back in January when it was listed at $649,000. It still hasn’t sold and the price is now down to $599,000. (Judging from the differing sets of photos in the new Mary Kay Gallagher listing versus the photos in the original Brooklyn Properties listing, the sellers have already moved out, suggesting there may be some urgency to the sale now.) We have a little crush on this house Colonial charmer and hope someone who appreciates its historic details comes along and buys it. For those readers who complain about there not being enough lower-priced houses featured, this is as nice a house as you’re going to find in the $600,000 range. Of course, it requires that you want to live in the Brooklyn College area.
2777 Bedford Avenue [Brooklyn Properties] GMAP P*Shark
2777 Bedford Avenue [Mary Kay/NYT]
Open House Picks 1/25/08 [Brownstoner]

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Sales at 525 Clinton Avenue, the 30-unit development in Clinton Hill that also goes by the moniker The Collection, just launched last week. There’s still not a lot more price transparency on the web than when we wrote about it last May, but the Two Trees website provides three data points: (1) a $675,000 one-bedroom (floorplan); (2) a $995,000 three-bedroom (floorplan); (3) a $800,000 two-bedroom (floorplan). Based on the slideshow of the interiors Curbed put together last week, the finishes look pretty nice. We’re also hoping the building will be a much-needed inducement for some better retail to come to nearby Fulton Street.
525 Clinton Avenue One Step Closer To Sales [Brownstoner]
Development Watch: 525 Clinton Avenue [Brownstoner]
525 Clinton Avenue Looking Good [Brownstoner]
525 Clinton Gets Its Glass On [Brownstoner] GMAP
Tower Rising at 525 Clinton Avenue [Brownstoner]
A Trip Inside Clinton Hill’s ‘The Collection 525’ [Curbed]

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The Steelworks Loft, at 76 North 4th Street in Williamsburg, released five units for sale last week, ranging from a $575,000 studio to an $895,000 one-bedroom. It’s a 1930s industrial building (well, that much you know from the name), with 88 units. Big bonus seems to be the roof, where they’ve got an open fire pit and a movie screen. Rough time to be releasing units; how do you think they’ll do?
Steelwork Lofts Coming Down the Pipe [Brownstoner]

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[nggallery id=”24677″ template=galleryview]

The Pratt Area Community Council has launched the website for its latest affordable housing venture called The Gates Cooperative. Located at 566 Gates Avenue between Tompkins and Throop in Bed Stuy, the five-story brick building will have 34 units, mostly 2 bedrooms. Construction is not complete yet (four months to go apparently). Here’s how the 34 units break down: 11 two-bedrooms at $87,000; 10 one-bedrooms at $150 000, and 13 two-bedrooms at $157 000. There is no difference at all in the 2-bedrooms, only who qualifies income-wise. The prices were determined by Area Median Income (some at 80% of AMI, some of 110%). Other restrictions: Half the units are reserved for Community Board 3 residents, and there’ll be two information sessions, one on September 29th, one on October 23rd, both at the Restoration Corporation on Fulton Street. As usual, he units will go through a lottery. — Rachel Chang
186 Washington Avenue [Corcoran] GMAP

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A few weeks ago, a reporter for the Daily News did a shop-through of Windsor Terrace, concluding that it had a “quaint retail mix” &#8212 that was actually the article’s title. Her take on neighborhood fixture Farrell’s &#8212 “Farrell’s smells like beer, has a hardwood floor, and neon Budweiser signs and an American flag in the windows… It’s not my cup of tea – or beer” &#8212 inspired a response from a longtime neighborhood resident on Container Diaries, a Windsor Terrace blog. “Institutions like Farrell’s and their survival are critical to the history that is so deeply entrenched in a neighborhood like Windsor Terrace.” The debate that follows is so heated, we thought for a minute we were reading Brownstoner.
Protect Your Turf [Container Diaries]
Farrell’s Pub. Photo by Rob Hoey.

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Towards the bottom of the New York Times‘ account of the seizure of Washington Mutual, the nation’s largest savings and loan and a big player in troubled mortgage market, were some interesting details about longtime Brooklyn player and brand-new WaMu CEO Alan Fishman’s non-role in the takeover proceedings and the big bucks he stands to reap for his three weeks of service to the company:

But the seizure and the deal with JPMorgan came as a shock to Washington Mutual’s board, which was kept completely in the dark: the company’s new chief executive, Alan H. Fishman, was in midair, flying from New York to Seattle at the time the deal was finally brokered, according to people briefed on the situation. Mr. Fishman, who has been on the job for less than three weeks, is eligible for $11.6 million in cash severance and will get to keep his $7.5 million signing bonus, according to an analysis by James F. Reda and Associates.

Fishman is the former head of Brooklyn-based Independence Community Bank and later Sovereign Bank; he’s also served as the chairman of the Brooklyn Academy of Music and the Brooklyn Navy Yard Development Corp. (As a commenter notes, he’s also on the board of the Downtown Brooklyn Partnership and used to be the chairman of the Brooklyn Chamber of Commerce.) Nice work if you can get it!
Government Seizes WaMu and Sells Some Assets [NY Times]