October 22, 2019
With Connect Media’s first-ever Opportunity Zone conference unfolding Wednesday morning at the Harvard Club, we took a closer look at a development site that happens to be located in one of these zones.
As we reported in August, this is a 250,000-square-foot site at 40 Bruckner Blvd. in the South Bronx’s Mott Haven section, which ABS Real Estate Partners is marketing on behalf of a family partnership. It has flexible zoning that allows for residential, commercial, industrial or community facility use, with residential representing the highest density. The family partnership is looking to identify a developer to take on a ground lease of the site.
That flexible zoning is just one of several boxes that the site checks off. “Alexander Avenue is a strong and trendy retail corridor and this spans two corners along Alexander Avenue,” ABS managing partner Alex Kaskel told Connect Media. “It’s one of the most exceptional development sites in the area.” Kaskel is marketing the site with colleagues Randy Modell and Ryan Cerqueira.
Some potential buyers are talking about participating in the state’s Affordable New York Housing program, which would enable them to both get and receive a number of benefits. With or without the tax benefits the program offers, though, they’d be coming into a neighborhood that has already seen high-profile development activity.
Brookfield Properties owns a 1.4-million-square-foot site nearby, and it plans to build 1,300 housing units along with a promenade and park on 850 feet of waterfront. Meanwhile, Lightstone Group added to its South Bronx holdings earlier this year, buying a massive land parcel in the area with plans to build a 2,000-unit residential development across that parcel and a site it purchased in late 2018.
“Being so close to what Brookfield is doing on the west side and to what Lightstone will be building, this is a real opportunity to step into what will be a live-work-play neighborhood,” said Kaskel.
Although some groups would plan to use Opportunity Zone funds, “some of the others aren’t really looking at it in that respect,” he said. “They’re saying, ‘this is a high-quality neighborhood’ and they want to develop here whether it’s in an opportunity zone or not.”
The appeal of the O-Zone angle shouldn’t be downplayed, though. “These neighborhoods do come with an element of risk when it comes to ground-up development,” ranging from construction costs to working with the city, said Kaskel.
“The Opportunity Zone certainly makes ground-up development slightly more appetizing and easier to justify,” he said. “In certain neighborhoods where they don’t have Opportunity Zones, it’s become really difficult, especially with land costs where they are.” He added, “This is one of the few areas in the city where you can build ground-up rental housing and justify it.”
Pictured, at top: Aerial view of 40 Bruckner Blvd. site. Below left: Alex Kaskel.
Connect National Investment & Finance is coming to New York on Oct. 23. For more information, or to register, click here.
Connect Opportunity Zones will be presented for the first time on Oct. 23 in New York. For more information, or to register, click here.
For comments, questions or concerns, please contact Paul Bubny