January 12, 2017
Related Companies paid $30 million for four apartment buildings in the Prospect Heights neighborhood of Brooklyn, NY, totaling 48 apartments.
That works out to $625,000 per apartment at 315-329 Lincoln Place, with a capitalization rate of just 3.75%. That price might seem high, considering that roughly half of the units were subject to New York’s rent-stabilization laws at the time of the sale.
The seller, BCB Property Management, found a way to both respect New York’s tenacious rent stabilization laws and also increase the rental income from the buildings. The fifth floors on all four buildings are recent additions, creating a total of eight new apartments with rents set high above the range governed by rent regulations.
“Very few developers in New York City could have achieved what Bennat Berger did in adding a full floor to an existing rent stabilized building,” said Cushman & Wakefield’s Stephen Palmese.