Monday, February 6, 2012

No Upside in Park Slope: 700 Sackett Street

Celebrating our 300th post!

Most of our readers already know what time it is when it comes to prices in Park Slope - others are still chasing the unicorn. Great sales can kind of mess with your head. It took us the longest to get over being under-bid and mishandled on 96 St. Marks. While it's very discouraging to have one of the best sales in the past 2 years within 20 square blocks slip right through your hands - especially from a phony-bologna all-cash offer and an agent who couldn't be bothered to get her client an extra $100K - we can't spend the rest of our lives living out long-gone glory days like Uncle Rico:

Ok, even at the one year anniversary mark of seeing that crushing sale, it still kinda stings. But we have moved on (somewhat). Accordingly, handfuls of buyers write us lamenting the sale of the gorgeous mansion that we covered 200 posts ago while still on the market last year, 287 Dekalb Avenue. There simply won't BE another 287 Dekalb. Or at least not within 20% of that price. For proof, just look at 338 Clinton Avenue going into contract this past Fall at its asking price of $2M with no pictures of its beautiful interior.

Accordingly, the sale of 158 Garfield Place has messed with the heads of the 29+ folks that submitted a written offer in the first month but didn't get it. On a street with $2M+ fixer-uppers, and $4M celebrity home bidding wars, this limestone, bowfront 8-Family with rent stabilized tenants and an underwhelming rent roll fetched under $225K per unit and a cap rate that isn't even that bad for how prime its location & curb appeal are. Now another 8-Family on a less desirable block with a worse interior wants more money... because??

700 Sackett Street is asking $2M and offers 8 2-BR apartments, 6 of them free market. Having an 8-Family with a majority of units destabilized is a huge plus, and the net operating income is listed at $130K. However, there's also no upside. The rents are pretty much what they're going to be, and a conversion play down the road is expensive, hard to predict when feasible, and the only value we can see left worth extracting at this price. Compare this to the $150K NOI on the gorgeous 603 Vanderbilt, or the genie in a bottle that is 234 St. James Place, with a ton of upside waiting to be unlocked (if only those wanna-be brokers would ever call anyone back). There's also another 6-Family apartment building in Park Slope for $2M and a 5-Family brownstone over here listed for over $2M, but we ain't seeing the appeal there either.

Pro's: never a unit unrented, 6 destabilized units, condo conversion down the road

Con's: little curb appeal, no upside, 2 rent stabilized units, railroad style, kicking yourself about 158 Garfield Place

Ideally: these guys at Terra CRG seem pretty legit. See what their angle is on the place & get in there and bid yourself some upside into the deal.

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