A Tale of Two Buildings: 1084 Fulton Street

Okay, not our usual post here. Ordinarily we focus on only residential properties, 2-4 Families. But this match-up caught our attention. Heading east on Fulton past Clinton Hill, towards Bed-Stuy, on a comparatively-desolate stretch we've covered before (that offers some value) comes this huge 3-Family + store. 1084 Fulton Street is 20' wide and 57' deep for a nice floor plate to work with. There's also plenty of space on the lot for what the listing calls a "backyard featuring beautiful landscaping and deck." The listing doesn't provide a layout, but says the rentals are 3BR's and 1 bath. The pictures of the rentals show nice, clean spaces with nice floors:



And we're loving the curb appeal of the bar:



At first glance, the off-the-beaten path location would seem to be the reason for the listing price seeming so low. However, if the building is projected to gross $121K/year after February 2011, that's an incredible Gross Rent Multiple. Compare that to the 16' landmarked building on 274 Court Street with half of Sweet Melissa in it. This building is renting at top of market already and set to gross just $10K more per year than 1084 Fulton. Sure, Carroll Gardens is a huge upgrade from borderline Clinton Hill/BedStuy - but is it worth paying twice the premium for almost the same return and little upside potential? Even Massey Knakal's listing on Smith Street in Boerum Hill just a few blocks away from this Sweet Melissa was a better opportunity, although also top of market.

Pro's: curb appeal, size, rental income potential, price, close to transportation, upside potential

Con's: neighborhood has a ways to go, commercial loans take 30%+ down, managing might be pain, bar might be noisy

Ideally: there's gotta be move to be made here at a price not too far from this. Especially if the desirable neighborhoods of Brooklyn are semi-interchangeable to you, the rental income is there for sure.