Foreign investors & Flatbush apartment buildings — Brooklynian

Foreign investors & Flatbush apartment buildings

This is an interesting story about a recent 6 building sale, 4 of which are in Flatbush. A Swedish investment co payed $125m for 378 units, which works out to about 330k per apartment. 

I have a feeling this will result in the kinds of shenanigans regularly occurring elsewhere, in the attempt to force old tenants out and raise rents, etc, etc. 

Interesting to note the comments, always entertaining on therealdeal, where people say stuff like "Linden Blvd & Flatbush Avenue - at night? Walk home from the subway at 1am and tell me about it."

Most of the commenters seem to think that the buyer overpaid. 


  • Idk that they would have to be up to shenanigans. The ppsf works out to $316, which is undermarket. Find anything for sale right now in those hoods that would have price tag on it. It's one of the last areas of brooklyn with decent subway access that is still affordable for avg NYers. 

    I think they bought because they feel everything else is frothy. This will appreciate nicely and in the meantime they collect rent.  

    It doesn't seem like the plan is to flatten buildings and drive out tenants. Usually that comes from developers with grander plans for a given lot (mfh-->condos).
  • I don't think they want to flatten the buildings. I think they want to drive up the rent. According to the article, many of the apartments are rent stabilized. 
    I don't know much about investing in large apartment buildings, but it was my understanding that, even though elsewhere in Flatbush houses, co-ops and condos might be going for $316 ppsf, that was still too high for this kind of building. 
  • edited August 2015
    Many investors are finding NYC an attractive place to park their money for the long term, because the returns are perceived as being better than bonds and with only slightly more risk.

    This firm may be pursuing a long term strategy, in which they outsource the mgt of the building to a large property mgt firm, which just gives them their expected rate of return and keeps the difference.

    As a result, you made need to worry about the NY property mgt firm far more than the Swedish.
  • But hey aren't the Swedes supposed to be so progressive?  Do they just save the liberal ideas for home consumption and rape and pillage elsewhere like good Norsemen?
  • Wanting a return on ones investment seems to be unrelated to nationality.
  • The sales records hit the public database today. 

    40 linden blvd
    36 units

    58 Linden 
    47 units

    95 Linden
    120 units
  • Shenanigans, in this case ignoring major building problems to do cosmetic repairs. 

  • At the moment, renters are desperate, They may decide to rent a place based on its appearance, an not care about the larger issues.

    ...they may plan to live there about a year, just long enough to get established in NYC.
  • Can the owner use building-wide improvements like landscaping towards raising rent-stabilized rents?
  • The landlord would have to convince HCR that they were necessary., no.

    They do bring the AirBnB crowd in though.
  • $$$ :o
    They also listed some apartments at 130 Martense. Hmmm. I don't think that's going to work. I wonder how long the Swedes are willing to wait, listing high-end high-priced apts that sit empty. But maybe I'm wrong. 
    I did hear that they did renovations throughout the building, even upgrading electrical for existing tenants, and sprucing up the interior courtyard landscaping. 

  • oh wow, that's right. even martense! 

    maybe i'm imagining it, but it seems like the martense units are bigger/closer to the original layouts (i.e. small but separate kitchens, sizeable living rooms, non-postage-stamp sized bedrooms, etc). if i were a renter looking to live in a freshly renovated unit with a washer dryer (like some of my co workers who are just "discovering" crown heights), I'd probably prefer that. i hate "open concept" galley kitchens that just cut into your living room space

    those linden apartments however will probably see some more price drops before they all get filled up. they're tiiiiiny
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