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15 Crown Street and 991 - 993 President Street — Brooklynian

15 Crown Street and 991 - 993 President Street

whynot_31
whynot_31
edited April 2015 in Crown Heights/Prospect Lefferts Gardens
15 Crown Street
991 President Street
993 President Street
Crown Heights

Until a few years ago, these two buildings were filled with unrenovated units that fell under rent stabilization rules. The buildings were reportedly purchased partially vacant in 2014 for $11M.

Since then, the majority of the apartments have been vacated and renovated.

The asking price is now $43M.

image

Comments

  • pragmaticguy
    pragmaticguy
    It's more than a few steps to Prospect Park, The Botanic Gardens maybe but not the park.
  • whynot_31
    whynot_31
    edited April 2015
    The shortest route into the park from either of these buildings is the entrance at Flatbush and Empire.

    I'd love to know how much was paid out to the tenants to leave, as well to renovate the units.

    IE How much of that $32M difference ($43M sale - 11M purchase) will be actual profit?

    It is weird to me that the rental market is so strong that these will remain rentals. In many cities, these would become condos.

  • pragmaticguy
    pragmaticguy
    Since the city started the "non-eviction" plan back in the 80s when everything was being converted I'm sure it would cost quite a bit of dough to buy the remaining people out. And I don't see how "low average rent" is a selling point. Also I'm wondering if the 100% down payment means they want cash only buyers.
  • whynot_31
    whynot_31
    edited April 2015
    Yes, I think they are seeking a cash sale.

    I think they are stating there is a "low average rent" to imply either:

    There are still some tenants in rent stabilized units, and the buyer might be able to buy (or "get") them out.

    -OR-

    This building is now filled with market rate tenants who are paying toward the lower end of area rates. Hence, if you buy these two buildings, they will always be filled. Unless you manage the buildings like an idiot, you will never have a vacancy for more than a month.
  • mugofmead111
    mugofmead111
    It's more than a few steps to Prospect Park, The Botanic Gardens maybe but not the park.
    It'd be a "few steps" to Prospect Park...if one were to bulldoze a path directly through BBG/the Brooklyn Museum's parking lot, and install an extra crosswalk on Flatbush Avenue. 

    The 2 and 3 are express in Manhattan but local in Brooklyn. 

    The building is literally steps from the shuttle tracks. :) 
  • whynot_31
    whynot_31
    edited April 2015
    aerial view of 15 Crown Street: http://goo.gl/maps/8KjqD

    aerial view of 991-993 President street: http://goo.gl/maps/G8ztC

  • mugofmead111
    mugofmead111
    There are schools right down the street too for your children! :) Hooray for existing infrastructure. 
  • dac545
    dac545
    I do love listings that say that a place is "steps" from another location.  Technically I am "steps" from any part of continental North or South America. 
  • whynot_31
    whynot_31
    edited April 2015
    In case you'd like to see what the buildings look like on the inside, here are pictures of 2 random units.

    15 Crown:
    http://www.aptsandlofts.com/rentals/15-crown-street-unit-6c-brooklyn-ny-11225

    993 President:
    http://www.aptsandlofts.com/rentals/993-president-street-unit-991-2e-brooklyn-ny-11225

    Each are 1 BR units, with washer and dryers. They were listed in the Fall of 2014 for about $2000 a month.

    They are rented now.
  • mugofmead111
    mugofmead111
    From the post on 993 President Street: "993 President Street is located just 1 block to Franklin avenue and 1 block to Prospect Park! The Brooklyn Museum is very close by and The 2,3,4,5 train Is right around the corner, giving you an easy and direct route to Manhattan!"

    Again, more skewing in the descriptions. The building is 2 blocks to Franklin Avenue train station (someone's forgetting about Union Street), and as we pointed out, you'd have to walk one very long block to get to Prospect Park, whether you'd walk south on Washington and around on Empire or up Washington and then down Eastern Parkway. 
  • whynot_31
    whynot_31
    edited April 2015
    The real estate agents would likely view your concerns as splitting hairs. They might state that in the eyes of the their audience, BBG is part of Prospect Park.

    I am kind of sad that we don't have photos of the two units before they were renovated, and how much they rented for before the MCI.

    MCI: http://www.nyshcr.org/Rent/factsheets/orafac24.htm
  • mcpoet
    mcpoet
    The shortest route into the park from either of these buildings is the entrance at Flatbush and Empire.


    One of my favorite parts of being a Brooklyn Botanic Garden Member is that it gives you the most direct path from where I live (right around the corner from these buildings) to Prospect Park.  I just cut diagonally through BBG and the southern entrance/exit lets you out right across the street from the park.  Unfortunately, they've been renovating that entrance for some time now, so I haven't been able to take advantage of that nice little, scenic shortcut. :-(
  • mugofmead111
    mugofmead111
    edited April 2015
    The real estate agents would likely view your concerns as splitting hairs. They might state that in the eyes of the their audience, BBG is part of Prospect Park. 
    ...but it's not. It's part of the area but the two entities are not attached to each other either physically or administratively.  Call me pedantic, but it's true. 
    The shortest route into the park from either of these buildings is the entrance at Flatbush and Empire.


    One of my favorite parts of being a Brooklyn Botanic Garden Member is that it gives you the most direct path from where I live (right around the corner from these buildings) to Prospect Park.  I just cut diagonally through BBG and the southern entrance/exit lets you out right across the street from the park.  Unfortunately, they've been renovating that entrance for some time now, so I haven't been able to take advantage of that nice little, scenic shortcut. :-(
    I used to do that all the time even before BBG started charging an admission fee. :) Yes, having the Empire Boulevard entrance closed is a bit of an inconvenience. Now I take a scenic walk up Washington Avenue and enter there instead.
  • mcpoet
    mcpoet

    From the Botanic Garden website: "The new café and outdoor kiosk are slated to open 12 to 18 months after construction begins. The Flatbush Avenue entrance and expanded Discovery Garden should open approximately 24 months after the groundbreaking."

     

    They broke ground in 2013, and I know that the Discovery Garden is opening in June ( http://www.dnainfo.com/new-york/20150127/prospect-heights/rebuilt-childrens-garden-open-at-brooklyn-botanic-garden-june), so based on this information the Flatbush/Empire entrance should be reopening shortly as well. Yay!

    Phase 2 should be rolling out shortly as well: "Phases 2 and 3 of the South Garden Project include the creation of a new Water Garden and the completion of a larger water conservation project and are projected to begin in 2015."

    It's apparently the biggest revamping of the Botanic Garden since its initial creation.  And technically the garden was originally supposed to be part of Prospect Park, but they didn't want Flatbush to bisect the park so it eventually became the separate Botanic Garden.  Though their attempt to mislead prospective tenants probably isn't quite so grounded in historical fact. ;-)

  • whynot_31
    whynot_31
    The building that occupies 15 - 25 Crown Street is once again for sale.

    The asking price is $23M for this building alone.

    http://terracrg.com/setups/15_Crown_Street.pdf

    Quote:

    On the Market
    15-25 Crown Street
    58-Unit Elevator Multifamily Building
    Asking Price: $23,000,000
    Price/SF: $451 | Price/Unit: $396,551 | CAP Rate: 3.6%

    Irreplaceable asset with 100 ft of frontage half a block from Prospect Park, Brooklyn Botanic Gardens and the Brooklyn Museum.

    This trophy asset is one of very few elevator buildings adjacent to Prospect Park and Brooklyn Botanic Gardens to be offered for sale.

    The gross income of the building is $1,142,913 and the NOI is $821,921.
    Tremendous value-add opportunity as the current rents are ~100% below market and 83% of the units are rent-stabilized.

    Opportunity to add significant income to the building by utilizing 27,000 SF of air rights (can be utilized as of right) and/or duplexing rooftop units and adding common rooftop space.

    The buildings have been maintained, improved and upgraded through significant capital improvements to the common areas as well as high-end renovations to the free market units.

    The buildings are located a few short blocks from the 2/3 and 4/5 subway lines, providing easy access to all points in Brooklyn and Manhattan.
    The building is located in prime Prospect Park North, one of the fastest growing neighborhoods in the Brooklyn market, with rents increasing 17.5% from 2013 to 2014 and increasing ~10% from July to August 2015.
    For more information: 15-25 Crown Street.pdf

    For more information, contact exclusive agents:


    Adam Hess
    Partner
    [email protected]
    ______________________

    Sam Shalumov
    Associate Vice President
    [email protected]
    ______________________

    Edward Setton
    Associate
    [email protected]
    ______________________

    Kirill Galperin
    Associate
    [email protected]

    (718) 310-3196
    terracrg.com






  • andrewshepherd
    andrewshepherd
    edited September 2015
    My wife and I lived in 15 Crown Street, in a very outdated apartment for two years, and moved to Nostrand/President last September. 

    We inherited the lease from a girl who was paying $1200 (1BR), and we were paying $1300. It was a building ridden with problems: Roaches, mice, our ceiling caved in twice, we rarely had heat in the bedroom, and we had a spreadsheet of over 150 complaints that were hardly ever responded to by the super and management. 

    The day after we (finally) moved out, I had gone back to grab one last vase from the apartment, and it was already gutted, and construction workers were using our bathroom as a temporary bathroom for their other projects. The asking price a week later was for a 2BR, and it was $2400. 


  • whynot_31
    whynot_31
    edited September 2015
    People are often amazed at how quickly such upgrades and repairs can be made.

    I tell them that it merely takes money.
  • andrewshepherd
    andrewshepherd
    Unfortunately, most of the materials (which are used in all these buildings now owned from TerrraCRG) were sourced from the Closeout! section at Home Depot. 

    We've been in a new apartment just a year — and we are not destructive people — and the tiles in the bathroom have cracked through the center, shelves in the shower have fallen out of the wall multiple times, molding is becoming unnested, and our closet doors are some of the most cheaply designed and installed things I've ever seen. They constantly fall off the hinges with even a gentle touch.

    It looked beautiful when we moved in, but everything about it was cheaply sourced and constructed. I can't not recommend apartments renovated and now owned by this company enough. 
  • andrewshepherd
    andrewshepherd
    Also, it is worth noting that our ceiling caved in (the problem we had twice at 15 Crown) 2 months after we moved in. You can renovate an apartment, but beauty in this case may only skin deep.
  • whynot_31
    whynot_31
    Short term, young renters are ideal.
  • andrewshepherd
    andrewshepherd
    Agreed. I was told when we moved out, they're looking for students. Preferably willing to bunk beds and make the most use of the space.
  • whynot_31
    whynot_31
    The MySpace model is brilliant in that it helps desperate young people find roommates quickly, and makes them feel fortunate that they are not being changed a fee for the service.
  • mugofmead111
    mugofmead111
    Also, it is worth noting that our ceiling caved in (the problem we had twice at 15 Crown) 2 months after we moved in. You can renovate an apartment, but beauty in this case may only skin deep.
    Thanks for posting this. It seems as if the tenant is going to be shortchanged either way-whether you are a long-term tenant in a stabilized unit that needs repair, or whether you are a tenant in a recently renovated market-rate unit. The grass is not greener on the other side. *sigh*
  • andrewshepherd
    andrewshepherd
    @mugofmead - yes. And the truth still is, they don't care. 

    $
  • whynot_31
    whynot_31
    I doubt either of these 2 groups cares:
    Group A: the tenants who are paying a lot but will be moving in 2 years.

    Group B: the landlords who have to do superficial fixes after each tenant because the initial construction was shoddy but shiny.
  • ehgee
    ehgee
    If you need to do an expensive renovation to jack up your rent stabilized maximum every time your apartment is vacant, it doesn't matter if your renovations last, anyway.
  • whynot_31
    whynot_31
    edited October 2015
    Whoever buys this is likely going to build a few floors on it or sell the air rights to a nearby development site.



    Dear (whynot_31),

    I wanted to let you know that TerraCRG has been retained to exclusively represent ownership in the sale of the 58-unit, elevatored multifamily building, only half a block from Prospect Park and Brooklyn Botanic Garden, located at 15-25 Crown Street in the Crown Heights neighborhood of Brooklyn. This is a rare opportunity to acquire a building just off Prospect Park for below replacement cost at less than $430/SF and ~$290/BSF.

    Some deal highlights below:
    • Well-maintained buildings with significant capital improvements to the common areas as well as high-end rental renovations to the free market units
    • In-place income of approx. $1.142M and NOI of ~$821K
    • Significant value-add opportunity as rents across asset are ~100% below market and 48 of the 58 units are rent stabilized and are paying just $21/SF
    • There is opportunity to add significant income to the building by utilizing 27,000 SF of air rights, that can be utilized as of right, and/or duplexing rooftop units and adding common rooftop space.

    Crown Heights has seen the most rapid rent growth in Brooklyn since 2013. The growth of Crown Heights rents has continued recently, from July 2015 to August 2015 studio rents increased by over 19%. In addition, unit averages for 1-bedroom and 2-bedroom apartments in Crown Heights increased by 8.45% and 6.28%, respectively, with a substantial ~10% increase in overall monthly average against the previous month.

    Download the setup for more information on this property: 15-25 Crown Street.pdf

    If you have any questions about this property or would like a complimentary evaluation of any property you are involved with, I can be reached by email or phone at 718-310-3296.

    Very truly yours,

    Adam


    Adam Hess | Partner | TerraCRG | 634 Dean Street | Brooklyn, NY 11238 |
    T: 718-310-3296 | F: 718-768-6288 | [email protected] | terracrg.com

    http://terracrg.com/setups/15_Crown_Street.pdf
  • whynot_31
    whynot_31
    The three sites sold for a total of $38M.

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