Park Slope FSBO: 35 St. Marks Avenue

You've seen us cover properties up & down the lovable St. Marks. Today's pick, 35 St. Marks Avenue, sits on the northern corner of Park Slope between 5th & 6th Avenue. The location is so clutch, which is what makes us lament the 96 St. Marks debacle and commend the buyer of the nextdoor neighbor 33 St. Marks Avenue for $1.6M this time last year. 33 St. Marks also turned around a killer renovation with a killer mark-up. 35 St. Marks Ave is for sale by its owner who gives us 2 interior photos and a floor plan for the footplate. And for the $100+ it costs to list on NYTimes.com for two weeks, they don't even let you put very high rez photos up:



Note, it took Corcoran a ton of fancy pictures to sell the very-presentable 57 St. Marks Avenue for over $2M in July 2011.

We're told 35 St. Marks Ave commands "a rent roll of approximately $180K per year, when fully occupied," which breaks down to a bullish $3,750/floor. As great as this area is, we're not sure if this interior and these numbers quite match up so far. And even then, investors can find $180K gross income in larger, cheaper buildings. We visited this question of gross rental multiple & cap rate a bit on two mixed-use buildings last year. We have to agree with the listing, though, that the expenses will be relatively low here compared to some of the other buildings that can command that cashflow. We have to reiterate that a cashflow of $180K here is very pro-forma in our book.

Another investment angle we're given is condo conversion. To that end, the "property has just received acceptance for filing of its Condominium conversion plan." And, indeed, there's a listing in the same building for Unit #2 as a $775K 3BR/1B condo. Which really threw us off when we compared it to the building listing's claim, "The owner is willing to forgo the higher sale price of the 4 individual units for a quicker sale of the entire property." Because last time we checked, 4 x $775,000 = $3.1M.



So unless one (or some combination of the other 3) of those apartments is worth $400K more than this one, what higher sale price is being forgone? Also note, the condo has an open house this Sunday, but the building is by appointment only...

To be sure, this is a quality property with lots of value, but we fail to see how it commands $3M with what else is out there, or if these condos are in condition to command ~$750/sqft individually. There are bunch of other giant 4-Family's for much less (in arguably better areas) that we'd take over this. We've got a few in mind...


Pro's: deep building, 4-Family, great location, high rental income potential, "just received acceptance for filing of its Condominium conversion plan"

Con's: we don't get much look at the inside, pro forma rent roll, fuzzy math on the "higher price" being forgone on the sale of the entire building, better things available for this price or much less

Ideally: we can't see any upside at this price, but maybe there's a happy medium here for someone at a lower price, or there's some secret, insanely well-renovated condo or two out of these four to justify the price