Wednesday, February 22, 2017

Developers of Big Bed-Stuy Complex Drop Religious Housing for Luxury Condos 

Brooklyn's neighborhood of Bedford-Stuyvesant is about to receive its most expensive complex. According to The Real Deal's sources, the developers of the seven-building Cascade condominium complex have dropped its plans for religious housing and will instead install luxury apartments. 

A group of investors from the Hasidic Satmar community in Williamsburg are the developers, who are planning to put the majority of the 301 apartments in the building constructed on the property that formerly held the Cascade Linen factory on the market with list prices between $1 million and $2 million, according to TRD's sources. The offering plan had not yet been approved by the New York State Attorney General's office, however sources say that approval is expected to come by late-April. 

TRD reports, "For nearly a year, the developers have been seeking construction financing, initially $144 million. Over that time, the first phase of construction – three of the structures – has been underway. Sources said the development group has been self-funding the project in the interim and is finalizing a deal to secure about $100 million in financing from an unidentified lender to complete the project.

Isaac Deutsch is leading the development in partnership with Abraham Brach and Nachman Leibowitz. They bought the site from Mike Kohn's Alliance Capital Group for $70 million in 2015, property records show. Kohn had paid only $27 million for the nine factory buildings on the site in 2013, but then filed plans for a residential complex. Deutsch and partners have largely followed through with those plans, with the intention of marketing the apartments to families and other members of the Orthodox Jewish community. Those condos are commonly sold at a discount, below market-rate."

The prospective residents for the complex have been very diverse, according to a source close to the developers. The source said, "Anybody who wants to buy there can." 

Two 10-story building, one nine-story building, one eight-story building and three six-story building will make up the whole complex that will be a total of approximately 340,000-square-feet. A city incentive allowed the residential component to be expanded by the developer through the inclusion of a 20,000-square-foot supermarket. The site, which between 1898 and 2010 was the location of a linen factory, contains the addresses 553-569 Marcy Avenue, 833-869 Myrtle Avenue and 90-134 Stockton Street.

The average asking price is $750 per square foot, according to TRD's sources.

Dave Maundrell of Citi Habitats, who is no longer involved in the project but had previously consulted on its design under Kohn, said, "Based on my knowledge of this property and experience in this section of Brooklyn, the neighborhood does not demand pricing north of $1 million for a development of this size."

The architect of record for the project is Samuel Wieder. Within the next six to eight months, the first three buildings are expected to be finished. The remainder is scheduled for completion by late 2018.

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