Scheduled Foreclosure Auction Today: 575 Eastern Parkway

A cute 2-Family town house in Crown Heights at 575 Eastern Parkway is scheduled for foreclosure auction this afternoon.  It's a 3-story 21' x 50' on a 100' lot with a lien of $875K.  It's got no violations, no SRO drama.  Condition is anyone's guess, but the bank says the scheduled auction is on.  Who knows where the price will land, but a nice stretch of Crown Heights between Nostrand and New York Avenue isn't valued like it used to be.  The listing for a narrower 4-story a few blocks east at 676 Eastern Parkway dwindled last year, but 610 Eastern Parkway didn't have any trouble getting around $1M earlier this year.  Then 270 New York Avenue around the corner sold for over $1.2M, and 291 New York Avenue turned down cash offers even higher than that!

With any luck, 575 Eastern Parkway is as nice as a neighbor around the corner on New York Avenue that locked up for under $700K just last year before the rebound was really in full swing in Crown Heights.   And we figure it's at least as nice as its neighbor at 599 Eastern Parkway:

When a place like this might be worth more than the lien amount and might be go for less than that amount, it may spell opportunity.


Pro's:  quaint 2-Fam in a nice pocket of Crown Heights, may go for a value, supposedly bound to sell today, looks nice to us so far

Con's:  short notice with little chance for due diligence, takes all cash, no clarity on condition or tenancy

Ideally:  couldn't intercept it before auction, so curious to see how it turns out

Another Gem In Contract in Prospect Heights: 400 Park Place

You mean to tell us another $2M+ fixer-upper bites the dust in a patch of brownstone Brooklyn as highly-coveted as Prospect Heights without hitting the NYTimes, Streeteasy, Zillow, Trulia, or Brownstoner??  Welcome to the inefficient market that many buyers love to hate.  On Platinum Member radar in September a few days after it came out, 400 Park Place needed nothing but a for sale sign in the window to move this estate sale for top dollar by the time the word got out enough.  With an asking price of $2.1M, you didn't need to be a real estate whiz to know that comps justified the price.  Afterall, it's not like a fixer-upper hasn't sold in Prospect Heights for $3.1M this year.  And if you needed some hyper-local apples-to-apples comparison, then Platinum Members sniping 408 Park Place (coming up on a year ago now...) for $2.15M just 4 doors down should help solidify things for ya.

Yes, 400 Park Place was a no-brainer, and for a time it was also a tree falling in the forest with almost no one to hear it.  (More or less still is!)  This 18' x 45' 2-Family on the extra-deep 131' lot would be flying off the shelves above $2M immediately if Corcoran got their hands on it and snapped a pic or two, but it doesn't take Corcoran to move a property in this market.  As we predicted, high offers were low-balling early on.  To think, $1.7M was the high offer on this house for a time.  Heck, even if you KNEW this house was available, the listing firm was playing it real close to the vest and not exactly welcoming buyers either.  But then the real aggressive home buyers barged their way in, got their hands on it, and bids slid all the way up beyond asking price.  We had no concerns about the place appraising high enough, but waiving the financing contingency (as is becoming a customary aggressive move) was the winning term to seal the deal.  Whether you want a nice swath of back yardage...

Or parquet floors for days...

Or tin ceilings and wood everythang...

This house had it going on.  Another one of the countless examples of the inefficient Brooklyn marketplace at work.  Even the barely-marketed houses can't stay a secret for long.


Pro's:  prime fixer-upper with original details and a huge lot, not on everyone's radar, not being bid up by the masses, even floors under old carpet are bound to be well-intact, this year's house at last year's prices

Con's:  gone already, work to be done, over asking price, took waiving financing contingency to do it

Ideally:  gotta stay vigilant for jewels like these, and strike aggressively to take them down

The Block is Hot: 1239 Dean Street Condo Conversion

What do you do when you pick up a 5-story, 20' x 50' historic house that's almost 5,000 square feet of brownstone goodness for $900K?  Why not turn it into 5 condos for $600K a piece??  You might've seen how much townhome activity we've covered in Crown Heights on this stretch of Dean between Nostrand and New York Avenue.  Now one of our go-to mortgage guys and resident of the block Adam Dahill tells us that condo sales on the block at 1239 Dean Street are pretty bullish, and he's right.  We first heard about the building most recently when off-market rumors went around that the whole thing might be available somewhere above $2M, but it makes way more sense for the owner to find various buyers to pay a per-unit premium to bite off a nice-sized turnkey condo bite they can chew.  The sum of the condo parts is much greater than the townhouse whole.  Much like we saw just across Atlantic Avenue on the Bed-Stuy & Clinton Hill border at 88 Quincy Street, any floor thru condo in a brownstone under $700K will get gobbled up in this market.  Yes, gone are the days (just under 2 years ago) when a condo in neighborhoods as coveted as Boerum Hill at 89 Dean Street could ask as low as $700K and fetch not much more than asking price.  Today the still under-appreciated Crown Heights 1200-block of Dean Street had these condos hit the market just under $600K, and so far has hit sales as high as $609K.  Like Unit 1 that closed for that price last month after some 6 months in contract...

Could those wood cabinets be more generic?  Could that painful pink tile on the patio be any better if the cement stripe wasn't running down the middle of it?  Were folding chairs the best staging they could muster here for tens of thousands in commission??  Peanut gallery potshots don't change the fact that $630/sqft still ain't too shabby for buyer or seller, especially when $850/sqft is crossing over into Clinton Hill and the Prospect/Crown Heights border with ease.  For a floor-through parlor apartment with a back patio over the garden, not too bad.  We've seen worse sell for more.  But - as we like to point out - raw price per square foot isn't what propels valuation here.  "Whole dollar" pricepoint is much more important.  And this is the only way you can get on this block anymore under $1.25M, unless you're ready to spend twice this much all-cash for an SRO with tenants, or chase an SRO estate sale around the corner with shady six-figure dollar amounts under the table.  Even then, you'd better have another six-figures ready for the renovation.  With modestly renovated condo comps like these coming in past Nostrand, still has us wondering why developers are underwriting condos near Barclays at $550K/each... still shaking our heads.

Unit 2 in 1239 Dean sold for slightly less that same week last month.  $585K to a buyer from Fort Greene with a cool 20% down, or less than $120K.  That's a manageable slice of house for handfuls of buyers.  Again, price per square foot aside, what else can you buy on this block with a "mere" $120K down?  It's certainly not likely to be a turnkey townhouse anymore in this market.

If you want a condo that's not in a cookie cutter glass building, with a short (but not that quaint) walk to the A express train at Nostrand, it doesn't get too much better than this.  Unit 3 is still available, down to $549K...

Certainly, the block is hot.  If you think this block is too sketchy to spend as much as $600K on a nice condo, then multiple bidders (including cash offers) upwards of $2M for a single family townhouse across the street certainly don't agree with you.  It's kind of adorable when the quarter-of-a-millionaires think they're still too good for the same block as the 2-millionaires.  The top, attic-y floor at 1239 Dean Street, Unit 4 has supposedly sold, but the price hasn't been recorded yet.  It features exposed beams and the obligatory roof deck for its premium...

It wasn't long ago (2007) that 1239 Dean Street...

... still looked just like the SRO at 1245 Dean Street.  If condo comps like these indicate that 1245 Dean's five stories plus extension might sell out as high as $3M gross as condos, then it's no wonder why we were bullish on 1245 Dean Street for as much as $1.2M last month.  If 1239 Dean isn't the blueprint for 1245 Dean, what is?

Pro's:  turnkey floor-thru condos at a manageable pricepoint, brownstone on a great block, a few details were done well to go for premium, one's still available with a price drop

Con's:  the best ones are gone, prices will feel steep to some, common charges aren't absurdly high or necessarily that cheap either

Ideally:  the 2BR/2B in unit 3 for $549K is cheaper than some 1BR's a few blocks west.  And maybe the comps that have already come in will help potential buyers feel warm & fuzzy about the valuation.

Crown Heights Rental on Top Block: 1183 Dean Street

Whether you call it Crown Heights (which it technically is) or Bed-Stuy, this stretch of great townhomes on Dean Street is so hot right now.  We can't be too hard on 'em for calling it Bed-Stuy.  The neighborhoods are only 2 blocks apart over here.  Only in New York does 2 blocks seem like a wormhole.  If you missed sales like 1062 Dean Street on market for $1.7M, 1261 Dean Street off market for $1.7M, and 1234 Dean Street listed over $2M with bids near asking price... then maybe you don't know how hot Crown Heights actually is.  Throngs of people with 25% down or less swear there's a turnkey gem waiting for them for $1M or less on these streets, now that they've finally come to grips with being priced out of every other neighborhood.  Unfortunately, SRO's with tenants go for $1.1M-$1.2M cash over here now.  And even the block between Brooklyn Avenue and Kingston has a house in contract for $1.5M at 1277 Bergen Street, sans pics!

Almost a year and a half ago, Brownstoner asked if there's "Something in the water on Dean Street?" which was over 6 months after we were watching millionaires whiff on gems like the stellar George P. Chappell masterpiece at 1142 Dean Street.  On that same block comes this floor-through 2BR rental at 1183 Dean Street.

The parquet floors are in great shape.  The wood trims and shutters and everything that everyone gushes over is intact.  Did someone say "pocket doors"??  A better shot of the mantle would help hit the historic high notes.  The kitchen and bath have been updated.  Not quite our taste, but a caliber on par with the market.  The asking price of $2,350/month is in line with what else we've seen over here.  Feels lofty, but when's the last time you shopped 2BR floor-throughs on nice blocks?  It ain't pretty out there!  Slow time for rentals now though, so maybe someone strikes a deal...



Pro's:  one of the hottest streets in Crown Heights, restored details & updated kitchen and bath, not a cookie-cutter condo

Con's:  not everyone's taste, not everyone's first choice location, not everyone's price range

Ideally:  by the time Nostrand resembles Franklin, guess what?  So will the rents.

It's Real in the Field: 88 Quincy Street, #3

On line at Barclays last night, we overheard someone saying, "I was looking for comps to justify my offer price..."  Because, while property prices are negotiated today, much of the data won't be out for months to come.  So how is one to stay ahead of the curve?  You can't play time traveler with the comps like many try to.  Heck, even appraisers calls us asking for the contract prices of houses that have yet to close, just to stay up to date for their appraisals.  But amidst the bullishness, many murmur the tide is shifting.  Have you heard owners and brokers all around town already saying that the buyer exuberance from the summer is cooling off?  As if the price increases were supposed to keep flying off into infinity, and every overpriced listing was supposed to fly off the shelves.  If your channel check data point for the cooling off in the red-hot Brooklyn real estate market is a dinky 3 story at Albany Avenue for $1.1M with little action at the open house, you may wanna take a step back and see how far we've come.  Pretty ridiculously high prices keep on coming in.  And there's no denying reality.  Kanye says, "You just look stupid to be ignorin' the DeLorean parked in front of Armani Emporium."

 

Let's let the market speak for itself.  A year ago it was hard to get over $700K for a poorly marketed fixer-upper gem in Bed-Stuy; now a "2 bedroom" condo on the border of Clinton Hill and Bed-Stuy can fetch almost $700K.  88 Quincy Street, #3 - with its 6.5' wide 2nd bedroom - was a floor through condo in a nice limestone townhouse.

This apartment closed at the end of September for $665K, above its asking price of $657K, to a buyer from a few blocks west in Clinton Hill.  If you're keeping score at home, that's $850/sqft for a "2 bedroom" in borderline Bed-Stuy.  And to think, people are still reluctant to spend $425/sqft for historic, turnkey townhomes over here!  Heck, even makes the "shocking number" at 1062 Dean Street look like a bargain at $425/sqft.  Another townhouse just off Franklin Avenue, the whole-dollar number on 1062 Dean at $1.7M looks super steep.  But when you back it into price per square foot, it's cheap.  Same applies for condos, sometimes in reverse.  $850/sqft sounds like an astronomical number for Bed-Stuy, but where's the next best $665K condo in town?

Raw price per square foot is only one way to slice up a sale, but even the best in the industry sometimes get too bogged down in it.  Buyers are running around looking to buy the best spaces they can afford in the best locations, not a prescribed price per square foot per neighborhood chart.  With tons of demand for even the dinkiest 2BR's in the $700K range, it's no wonder 88 Quincy can have that kind of price action.  And why we're surprised that developers are telling us they expect renovated railroad 2BR's a block from Barclays will only sell for $550K.  An apartment at nearby 1 Hanson Place, #18K closes for $1.4M+ this month, which is many months in a row now of $1,000+ sqft comps in that building.  Yet people assure us there's no market for a condo conversion at half that price.  Smh.


Pro's: nice floor thru "2BR" in a limestone, manageable pricepoint for lots of buyers, ever-more coveted location

Con's:  not the full-size 2nd bedroom many insist on, price per square foot will shock & awe, tweener location, many will point out this is what an entire house over here cost not long ago (but you'd have to ride the DeLorean back in time to get it!)

Ideally:  demonstrates that a presentable bite that's not too hard to chew for many buyers can trade at a premium

Sandwich Spot Arbitrage Play Becomes a Sandwich Spot: 64 6th Avenue

If Brownstoner can keep you up to date with the endless foodie minutiae goings-on in Brooklyn, from time to time why can't we??  Ever since falling in love with some amazing paninis out of a simple hole-in-the-wall in Florence, Italy back in 2011, we'd been scheming on an affordable little commercial space to try a sandwich spot in Brooklyn.  Since we know nothing about the food biz proper, we wanted to sign a lease that at least had some arbitrage to fall back on if the sandwich biz went south.  That year we checked out the space on Franklin Avenue for $1,500/month that later became Little Zelda.  Ultimately, it was an exercise in woulda/coulda/didn't; but suffice to say that even space that small is worth well over $1,500/month these days on the beloved Franklin Avenue hub of Crown Heights.

But then this year things got even more interesting when we saw the tragically-out-of-place Cream Puff Cafe closed their doors in an even more amazing location, on 6th Avenue at the crossroads of Prospect Heights and Park Slope, around the corner from the Barclays arena.  They were balking on a lease as low as $1,600/month, which seemed like another no-brainer to us, since you can barely pick up space that size on Washington Avenue in "Crown Heights" for under $3,000/month, let alone 6th Avenue in Prospect Heights proper.  We put out the sandwich spot bat signal, even getting the Scharf & Zoyer folks in on the action, but ultimately we were too slow on the trigger and a lease was signed for a still-paltry $2,000/month.  Thus the "Bergen Dean Sandwich Shop" was born.  We went yesterday to try the wares.  And - take it from us - the $9 (before taxes) sandwich is alive & well in Brooklyn!

The build out hits all the hipster high notes.  Simple composite stone counters, dark wood floors, subway tile.  Two red light fixtures reminiscent of an Arby's from the 1990's.  Nothing tricky to execute.  The old-timey animal wall paper adds a bit to the motif...

The sandwich?  We went pulled pork with onions, beets, and jalapeno.  [Correction:  'twas the short rib!]  Which in fact was one of the exact chef creations one of our sandwich spot co-conspirators had cooked up at the house to rave reviews.  It's simple, not too flavorful, but totally nourishing.  A little toasting of the bread would definitely take it to the next level.

 

Yes, as picky as we are in Brooklyn, New Yorkers as a whole are actually quite easy to please if you give them something simple they'd been missing.  All it takes is a guy from a humble place like St. Louis to finally bring a decent to cheeseburger to New York, and all of a sudden you'd think Shake Shack had completely reinvented the concept.  Is Shake Shack really God's gift to cheeseburgers?  No, it's just the first half-way serviceable one that self-important New Yorkers had put in their mouths before.  This place "Bergen Dean" may not wow you, but it certainly gets the job done.  And for that, they'll be applauded.  It's not like they'll give Brooklyn Larder a run for their money or anything, but with a smaller, simpler operation - they may not have to.

Open House Today for Prospect Heights Flip: 734 Bergen Street

Oh, so you want a turnkey townhouse in Prospect Heights, Brooklyn for $1.5M?  Well, join the club.  Too bad there hasn't been a decent one like 416 Park Place in well over a year when we told you to "buy now, thank us later."  Since then, if you didn't buy 474 Dean Street, then you're out of luck.  Since 416 Park Place, handfuls of houses much further east than Prospect Heights have commanded over $1.5M.  In fact, even off-market & barely-marketed fixer-uppers in Prospect Heights command over $2M, and a few four-story gems in Prospect Heights have traded over $3M.  So what's left?

Well, Platinum Members passed on 734 Bergen Street a few months ago when we heard its dwindling, under-marketed $1.2M listing had the owner desperately seeking someone to do the deal closer to $1M or less.  Someone chimed in and took it off their hands, closing just 2 months ago in September for $965K.  They quickly put it back out for the flip with Corcoran at $1.5M.  That pricepoint was nothing doing, so they quickly dropped to $1.375M and have an open house today.  Feel free to come by and see what the sub-$1.5M market in Prospect Heights looks like.  It's pretty much a garage and two turnkey rentals.

If you're saying to yourself, "That's just a 25' by 35' trapezoid with a future development on two sides of it," you're not mistaken.  Sure, as-is the place is worth more than the $965K the owners paid for it, but perhaps not quite the $1.375M they're asking for it now.  Although, it may still beat $1.2M duplex condos around the corner at 475 Sterling Place or carriage-house condo alternatives down the hill in Clinton Hill like 91 Irving Place.  And maybe the construction set to come on the lot that runs from St. Marks to Bergen Street, adjacent to the house on two sides, won't be the most inviting place to live for a few years.  But, if you missed 489 Park Place for $1.3M all-cash last year, or the tiny 678 Dean Street for over $1.5M last year, or 579 Bergen & 542 Carlton Avenue almost 2 years ago... then this is just about all you can sniff under $1.5M here anymore.



Pro's:  open house, parking, 2 turnkey units, price flexibility already in action, technically this is Prospect Heights and well-situated

Con's:  someone else's flip, construction site coming to a lot near you, quirky size & shape, not your typical townhouse, not the best block

Ideally:  if you didn't like it at $1M, it ain't any prettier at $1.375M - although you can't buy what you don't know is for sale, and that's where Corcoran often comes in