Getting the Obvious Buyer to Pay the Right Price!
Bob Knakal and his team successfully closed the sale of the architecturally significant 9 DeKalb Avenue in Downtown Brooklyn for $90,000,000. This transaction highlights the importance of persistence, creativity, and establishing competitive pricing in a situation where the most logical buyer believed they had little competition.
Sale Details
Final Sale Price: $90,000,000
Seller: JP Morgan Chase
Buyer: Michael Stern and Joseph Chetrit
Property Type: Development Site / Landmark Building
Total Buildable Square Feet: 450,000
Sale Date: December 18, 2015
Property Details
Full Address: 9 DeKalb Avenue, Downtown Brooklyn, Brooklyn, NY
Property Type: Development Site / Landmark Building
Building Size: 135,000 square feet
Transferable Development Rights: 315,000 square feet
Total Buildable Square Feet: 450,000
Sale Price: $90,000,000
The Landmark Building and Air Rights
The property, originally constructed in the mid-1850s as the Dime Savings Bank of New York, is one of New York City's most architecturally distinct buildings.
However, the challenge of this deal lay in the fact that the building was landmarked, which meant it could not be demolished to take advantage of the 315,000 square feet of unused air rights.
This created a situation where finding the right buyer who could use both the building and its transferable development rights became key.
Adjacent to the bank was a development site owned by Michael Stern and Joseph Chetrit, both experienced developers planning to build a residential tower.
They had offered $65 million for the bank building, believing that since they were the only ones who could effectively use the air rights, no one else would pay more.
Maximizing Value by Creating Competition
Bob and his team believed the site was worth much more and aimed to get the neighbor to pay a fair price. Through detailed research, they found a creative solution by studying a similar development in Philadelphia where a landmarked bank building was incorporated as a grand lobby and retail space for a hotel development.
This concept demonstrated that the landmarked building had more value than the neighbor had assumed.
To further enhance the pricing, Bob and his team reached out to other potential buyers, including retail property investors and two user buyers. These parties made competitive offers, establishing the highest price a third-party buyer was willing to pay.
Neighborhood Overview
Downtown Brooklyn is a thriving hub for residential, commercial, and cultural development.
- Transit Accessibility: Served by multiple subway lines, making it a prime location for commuters.
- Cultural Landmarks: Home to the Brooklyn Academy of Music (BAM) and Barclays Center.
- Future Development Potential: High demand for mixed-use properties in this rapidly growing neighborhood.
Conclusion
The sale of 9 DeKalb Avenue demonstrates Bob Knakal’s expertise in overcoming complex development site challenges, maximizing value, and strategically positioning landmarked properties.
By introducing competitive offers and leveraging innovative development ideas, Bob and his team were able to secure a far better price for their client.
Testimonial
Here’s what the seller, JP Morgan Chase, had to say about Bob’s work:
“Bob, you and your team did a fantastic job representing us here. You did exactly what you said you would and the results speak for themselves.”
– JP Morgan Chase
Learn More About Downtown Brooklyn Real Estate Development
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