Clarett, Goldman Lose Control of Forte
Not everything Goldman Sachs touches turns to gold. A multi-million-dollar bet on the Fort Greene condo market appears to have backfired, with the Crain’s report yesterday that control of the Forté Condos at 230 Ashland Place would shift from Goldman, the 75 percent equity holder, and The Clarett Group, the developer, to the lender, Eurohypo…
Not everything Goldman Sachs touches turns to gold. A multi-million-dollar bet on the Fort Greene condo market appears to have backfired, with the Crain’s report yesterday that control of the Forté Condos at 230 Ashland Place would shift from Goldman, the 75 percent equity holder, and The Clarett Group, the developer, to the lender, Eurohypo Bank, which is into the project for $41 million. (Prudential Real Estate Investors also has a small equity stake.) 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. A last-ditch marketing makeover by The Developers Group in recent months as well as behind-the-scenes efforts to sell blocks of apartments apparently weren’t enough to save the equity investors, as the project was less than 40 percent sold after two years on the market. Clarett’s nearby project on Lawrence Street, the 51-story Brooklyner, is still expected to begin renting early next year.
Goldman Sachs’ Brooklyn Condo Bet Sours [Crain’s] GMAP
Snappy;
In answer to your question:
From a purely legal point of view, this change *should not* affect the owners in place, as the Forte condominium has already been formed as a separate legal entity. Again, from a purely legal point of view, what has happened is that the ownership of the unsold units has passed from the equity side to the mortgage holder.
From a practical point-of-view, the owners are in for a hellish situation in two ways:
-the ability to sell ANY unit in this condo will be severely crimped for the next couple of years, to say the least. No bank in their right mind will finance a purchase of a unit, which means that they will likely be rented out, which lessens the appeal and value of the building.
-as someone mentioned above, in a new building there are inevitable start-up problems, which are usually addressed by the developer. With the developer out of the picture, they will have a tough time getting these issues addressed.
This is bad news for the Brooklyn condo market, no way around that fact.
Also…anyone wanna take a bet on the last time Return Of The What got laid?
Can you imagine him on a date?
ROTW: “Yea man, because all these YUPPIES moved in from OHIO and with their BABY CARRIAGES and MONEY but they’re all going to pay dearly!”
Date: “Uh huh”
ROTW: “And like…soon their brownstones will be worth NOTHING and they’ll have to move back to UTAH so Brooklyn can be the way it used to be!:
Date: “Right”
ROTW: “Yea so I’m on this blog. Everybody like, totally knows me, cuz I’m all like: Hey your property won’t be worth anything soon! It’s so rad”
Date: “Check please!”
Kens…I find that Rolling Stone story a bit ridiculous. For example, ALL broker/dealers and investment banks made hay during the tech bubble and it was Credit Suisse and Jack Grubman who were the poster boys of the bad stuff, not Goldman.
RS does some good reporting at times but that story was largely crap.
GS price target $200.
… and no one has mentioned the awful awful floor plans? all wierd angles, ugly hvac units… i really was interested in the project, but didn’t want to attempt to put furniture in there…
as for the finishes and stuff, never saw the finished project, though i’m sure it’s average… i don’t think people that bought in that building were very informed about the market…
there was so much better available for the same price or cheaper…
I guess my link from yesterday about Goldman is worth repeating on here.
http://www.rollingstone.com/politics/story/29127316/the_great_american_bubble_machine
Lincoln slope, will you please stop living vicariously through your friends, boyfriends, aunts, uncles, relations, friends-of -friends, friends-of-friends-of-friends?
Yea this building sucks. Whether or not it’s technically in FG or Downtown Brooklyn…it’s in Downtown Brooklyn. I rather live in Concord Village than this pos MetroTech-looking tower.
Peace I’m out!
BO, aparently you missed the story about Goldman adding to its RE on the Fulton Ave stretch in Bed Stuy.
Your call for victory for Team Bear is a bit premature unless you are saying we’ve hit that botoom at nowhere near half off peak comps.
Lincoln Slope…always better to buy in an established building than a new development…I’ve been ranting about that for months now. Good for the bf in the pre-war NS building, congrats.
Perfect example of why so many lunatics on Team bear really don’t understand the market.
Future Low-Income Housing!
The What
Someday this Condo is gonna end..
Guys, Dave is a Day Trading Pole Smoker –>DTPS
How much is that Condo worth? ROTFLMMFAO!
Guess what Jackasses? Any Broker who shows Forte Condos MUST disclose the Bankruptcy!
How many Retards buying now???!!! I caught some wood…
The What (Ker Boom!)
Someday this Condo is gonna end…