Prime Boerum Hill Buildings on the Market
Massey Knakal has a new listing up for 292-294 Atlantic Avenue, properties that include the St. Clair diner on the corner of Smith. The buildings are on the market for $4 million. (PropertyShark records show that the buildings sold for $4,800,000 in 2007.) More info from the listing: “The property is comprised of three retail…
Massey Knakal has a new listing up for 292-294 Atlantic Avenue, properties that include the St. Clair diner on the corner of Smith. The buildings are on the market for $4 million. (PropertyShark records show that the buildings sold for $4,800,000 in 2007.) More info from the listing: “The property is comprised of three retail stores, two offices & four apartments. The New St. Claire Restaurant is the anchor tenant with a lease expiring in 2017, however the landlord will make representation that the space can be delivered vacant. Market rent for this location is estimated to be $85 – $100 PSF or $12,500 – $15,000 per month. The upper floors are averaging $1,800 per month in rent, which is below market for the location.” The diner changed hands a few years ago and got a makeover in the process.
292-294 Atlantic Avenue [Massey Knakal] GMAP
If that’s the case, butterflu, and they are going to walk away from the restaurant it jepardizes the whole rent roll assumption for the property. Even if they say they are not going to walk away from the restaurant, it’s very risky.
is the resto current in rent?
I suspect the same individuals that own the building also own and operate the Diner. If they get asking price they are prob. willing to walk away from the diner operation if they can only get below asking they may choose to make up the difference by running out the lease to expiration. The Greek Family that owned the diner at the same location previously also owned the building.
Further info on the leases, etc might make it an even better deal in a year or so. I wouldn’t raise the rent on that restaurant to make it harder for them though. If they have a 15 year old lease that’s about to expire (highly unlikely given the recent renovations) than maybe it could go somewhat higher but, worst thing for a building (and a neighborhood) is an overly greedy landlord.
Agree with DIBS, a 6.6% cap rate for this type of property is market today.
Like the residential property discussion we had last week, I happen to think that there is not enough of a risk premium in owning Brooklyn real estate at the moment and so would rather put my money in other asset classes at the moment, but that doesn’t mean the price of this property is “above market”. Seems reasonable to me and I bet that they get within 5% of ask.
If you go onto the M-K listing and click on the attachment labelled 292 Atlantic Setup – pdf, you get all the numbers.
The current revenue is $328,000 and expenses are $63,000 for net income of $265,000. On a $4MM purchase price, that’s a net yield of 6.6% and isn’t bad at all.
Any other discussion is superfluous.
85 to 100 for that corner? not really
Wow, this is on the market for $400,000? I’ll buy it today! Where do I sign? Also, the owner must feel good that these brokers were too lazy to walk 5 blocks from their office to take a picture that is not 5 years outdated. And just as a kicker, they misspelled the name of the diner as there is no “e” on St. Clair. Attention to detail…
I would imagine the apartments are averaging less than market rates because they’re above a diner and have more than their fair share of cockroaches and mice.