Thursday, April 26, 2012

Crown Heights Corner In Contract: 1078 Park Place

We're all about the huge corner properties this week. Today's pick is a great opportunity in Crown Heights, on Platinum Member radar early on, but now in contract. 1078 Park Place is a ginormous 24' x 90' brick building on the corner of Park Place and Kingston, across the street from Brower Park. And someone might pick this up for under $700K. At 4 stories and over 7,000 sqft, you can barely fit this place on the screen in your Google Street View.

Sure, it appears to have been used most recently as a church, and it has a Certificate of Occupancy for a "School and two (2) families", but none of that really matters if it can be delivered vacant, because you're bound to do a gut renovation and a Certificate of Occupancy change anyways. So you might as well not bother with something that's only half-way what you want and more than half-way priced there already. Get something priced as a gut, and you get to do a full gut to your exact specifications. And at potentially less than $100/sqft, how can you go wrong?

People are always coming to us, marveling at a property value that's doubled or tripled in a handful of years. 9 times out of 10, those very people would've been too chicken, or lacked the vision to ever have purchased that same property at that time. We remember when people made fun of us for picking up Apple stock for $100 during the crash, because it poked down to $80 a few weeks later. They said, "It's just a computer company, I don't know who told you to buy that." Now it sits squarely at over $600/share, and someone just slapped a $1,000 price target on it. It didn't take too much vision to see that when people started spending twice what they used to pay for (ground-breaking at the time) Trinitron televisions just for a high-tech phone in their pocket, that the growth potential was virtually unstoppable. Now iPads as high as $800+ sell like hotcakes (over 12 million sold last quarter). So with $800/BR cropping up as the price for rentals deeper and deeper into Brooklyn along the A/C and 2/3 lines, and $500-$600+/sqft condos sweeping eastward, well... you get the point. There's still no such thing as a free lunch, but you sure can find a good lunch special - if you know where to look.

Pro's: huge, vacant canvas, 114' of frontage, curb appeal, across from park, great reposition play

Con's: deep in Crown Heights by some estimations, renovation may easily exceed purchase price, takes a little vision & patience to see full fruition of investment

Ideally: nobody's gonna hand you a 3-bagger, you have to go out and make you one

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