Inside Third & Bond: Week 21

While the talking heads worry over a recession and the people on the street wonder if there will be down market buying opportunities, we thought this would be a good time to check-in on the neighborhood surrounding our site. We like to keep an eye on what’s happening, just like this neighbor from across the street who is watching us work (see pic).

Whole Foods
Our informant tells us that DOB was about to sign off on the latest permit when they realized that they didn’t like the reference datum that the survey was based on. This is after having seen the survey many times. We can relate to the frustration… and we hope they get it worked out soon. We’re anxious for them to get going because having Whole Foods down the street is a huge benefit to our project. We don’t love hearing the constant rumors and all the comments about that damn construction fence. Before the blogosphere, we never could have imagined the endless speculation based on a couple of sheets of plywood.

Sites for Sale
Catty-corner from our site are two sites for sale. Per Ken Freeman of Massey Knakal who is representing the owners, some offers are expected this week. (No word on if they’ll be deal-making offers.) From our perspective, retail on the ground floor would be great with office or artist space above. We’d especially love to see artist workspace instead of something like a warehouse for widgets. It seems to us that the attractiveness of the sites would be much improved if the adjacent cement company (incidentally, across the street from our old office) was included but we don’t have any reason to think that the cement company wants to move. Since they are all in a manufacturing zone, we aren’t expecting any offers based on plans for residential development, though we’d be okay with that, too.

New Projects in the Nabe
Last night we toured 116 Third Place, a project so new on the market that Corcoran hasn’t posted pictures of it yet on their website. We care about this project because it could serve as a great comp for us. They are asking for high prices, about $1,000/SF which should make our prices that much more appealing. It’s 5 units with 3 floor throughs, a garden duplex and a penthouse duplex. The finishes are lovely the Henrybuilt carmelized bamboo cabinets look warm while modern, as does the pebble stone floor in the bathrooms. The Subzero fridge and dishwasher have a handsome finish we’re not sure of the material but we loved its matte effect in contrast to the stainless steel so prevalent in today’s market. The building features under floor radiant heat and a keyed elevator to every unit. The elevator is a little bit of a surprise in this size of a building, but it might make a difference in getting the prices they want. The third floor residence is around 1,000-square feet (two bedrooms, two bathrooms). One of our favorite things about this particular unit is the view out the windows from the couch (opposite a gas fire place) of the elevated F-train. You can’t hear a thing and it looks really cool. Even from the generous patio, the noise from the train was negligible. We weren’t able to tour the penthouse duplex but we saw a floor plan and it looks like something you might see in Architectural Digest. But what did we like most of all? Dual flush toilets in every bathroom.

Height Limits Rally Today
Anyone who takes the F or G train from Carroll Street has seen the murals and postings on Democracy Wall protesting the height of a 7-story building planned for that corner, as well as generally protesting buildings higher than the typical 4 or 5 stories in the neighborhood. Last September, CORD (Carroll Gardens Organization to Respectfully Develop) got thousands of signatures on a petition for a moratorium on development over 50′. And this morning there is a rally planned in support of Councilmember Bill de Blasio’s resolution asking for that moratorium and for the City to fast-track its study of downzoning Carroll Gardens. It doesn’t come as a surprise to us that as we’re developing a project, there’s a community protest underway that has the potential to downzone/landmark/etc us to tragic financial consequences. But in this case we’re just happy not to be the cause of the protest and to be safe our plan is for 4-5 story buildings and we’re getting our permit long before any changes can take effect.

Gowanus Rezoning
In addition to potentially studying downzoning in Carroll Gardens, the City’s Department of City Planning has already begun studying Gowanus for rezoning. They kicked off the study last January, but we haven’t heard much new since last July. Since it’s going slowly, we are glad to be doing our project permitted as of right. Our site is zoned residential, which is not true of many of the development sites along the canal or even across the street. We have looked at a number of sites that are in the rezoning framework, and we are much happier developing full steam ahead than trying to be patient over a number of years waiting for rezoning while construction costs escalate and tax exemptions disappear.

Third Avenue Price Inflation
We’re observing the expansion of Park Slope’s influence across not only 4th and 5th Avenues, but all the way to Third Ave, where the converging influence of Carroll Gardens is coming. Fifth Avenue has been Park Slope proper for awhile now and it seems like a new, higher end, boutique or restaurant is opening monthly. Fourth Avenue has places like Mule and Pacific Standard, Le Bleu, The Novo… Third Avenue has not only Whole Foods coming, but also is starting to see sales like the one Brownstoner reported on earlier this week — $10.5M for an old industrial warehouse that the buyer is thinking of making into a pharmacy or some other retail use. Given that the investor is thinking of keeping the building for a retail use instead of building the 80,000-square feet he could get onto the site, or using it for an industrial purpose, we’re thinking that he and the market are seeing a lot of immediate and future potential in Gowanus. This price inflation is good news for us because it reinforces the value of our site not only as development property, but also in the eyes of buyers who want to see amenities in front of them, or at least on the horizon.

Women’s Wear Daily
Our research on the happenings in the nabe aren’t just limited to the usual sources… even the bible of fashion, WWD has something to say about Gowanus…

Inside Third & Bond: Week 20 [Brownstoner]
Inside Third & Bond: Week 19 [Brownstoner]
Inside Third & Bond: Week 18 [Brownstoner]
Inside Third & Bond: Week 17 [Brownstoner]
Inside Third & Bond: Week 16 [Brownstoner]
Inside Third & Bond: Week 15 [Brownstoner]
Inside Third & Bond: Week 14 [Brownstoner]

From our lawyers: This is not an offering. No offering can be made until an offering plan is filed with the Department of Law of the State of New York.”