Wednesday, October 14, 2015

Tantilizing Glimpse into Crown Heights Foreclosure Gem: 1370 Dean Street

It's not everyday that you get a sneak peek at an 1880's castle in Crown Heights the weekend before its foreclosure auction.  But that's where took Platinum Members two weeks ago at 1370 Dean Street.  This single family gem is on a 26' wide lot, so the stunning curb appeal wraps all around the unattached side to a deep extension in the rear.  Except for some water penetration in a few spots, the facade itself looks as bright and fresh as the day it was born.  And when the owner told us the house needed a gut, we believed him, but we had to see it for ourselves...

There wasn't much to see inside,  but it was nice to get a look at the light from the baywindows and corner rooms with two exposures.  A lot of work to be done, but a lot of potential.

Just two years ago, the New York times chronicled details of the 125 year history of next door neighbor 1372 Dean Street.

Back when it listed with Corcoran for and sold for $1.32M.  The gut renovation and conversion to a 4-Family at 1372 Dean Street is still on-going.  But they're killing it from we could see on the 1370 side...

It took us two years to get the owner to let us into 1370 Dean, which once was asking $2M.  With a week to go before foreclosure auction, there was a deal in the works over $1.5M.  And other offers trickling in around $1.2M-$1.3M misread the situation as distressed.  But with cash offers over $2.5M off-market on similar houses a few blocks away, we saw "over-paying" today for a flagship shell like this as a no-brainer, since it stands to appreciate at the crème de la crème pricing of the area.  As long as ho-hum shells like 204 Jefferson Avenue command over $1.6M...

Then 1370 Dean Street isn't hard to grasp over $1.5M.  If what was later treated like a shell sold for $1.3M over here two years ago, why not over $1.5M for the next-best shell?  Well, no one would know better than someone who's done it before.

The dream of scoring a steal at a foreclosure property is intoxicating to so many, but finding them and executing them is hard.  And sometimes the owners aren't even in the distress that the would-be buyers perceive.  Requiring cash, limited or no access to the property, plenty of additional capital required for renovations, uncustomary time-lines, wild card tenancy... it's not for the faint of heart.  So when you're chasing that foreclosure unicorn, you gotta remember it takes dreaming big, and executing even bigger.

Pro's:  out of control curb appeal, unattached on one side, windows galore, extension, lots of buildable sqftage left, basically gutted the old and ready for the new, great block with a unique variety of architecture, project next door lays the blueprint for the possibilities, landmarked block, ready to be a King Kong 1-2 Family or condo/rental project

Con's:  a lot of money for a shell, no original details left inside, took cash, had to move quickly, completely unliveable and requires a bunch of money and time into the gut renovation, may not net a product whose whole is greater than the sum of its parts on day 1 depending on how ya play it

Ideally:  a flagship property for another century to come, available to few, and understood by even fewer

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