Betting on slow eminent domain and instant retail potential, investor buys Atlantic Avenue building destined for second phase of Atlantic Yards
Brooklyn Arena Pulls More Retail, the Wall Street Journal reports:
A real-estate investment company has closed on the purchase of a 105-year-old industrial building near the site of the new Barclays Center sports arena in Brooklyn.Retail rents in the area may double from the current $50-$60/sf when the arena opens.
Waterbridge Capital is considering turning the 40,000-square-foot facility at 700 Atlantic Ave. into a retail center, a person familiar with the matter said. Waterbridge bought the property for about $7 million, this person said.
Location and timing
The building is in the area indicated in blue on the map (from DDDB) above right.
Phase 2 of the project, located east of the arena block, has an unclear future, but could take at least a decade to get started.
(Map at left from Empire State Development Corporation.)
Forest City Ratner has a decade to start building on the southeast segment, Block 1129, site of an interim surface parking lot.
The developer has indicated that it's much easier to start building on that southeast block, given that it's terra firma.
To construct a tower on the parcel that includes 700 Atlantic Avenue, Forest City would have to build a costly deck over the relatively narrow railyard segment.
The firm occupying 700 Atlantic Avenue, Global Exhibition Services, made trade-show exhibits and was last in the news last June, when the Empire State Development Corporation went to court to force it and an adjacent owner to allow access to a Forest City Ratner affiliate working on a new permanent railyard adjacent to those properties.
Eminent domain coming?
The Wall Street Journal notes the site's potential future:
But Forest City hasn't begun any residential construction because of the financial downturn. The company expects residential work to begin on the first phase of the project by the end of the year. The second phase of construction, however, is still years away.
Waterbridge hasn't ruled out selling the property to Forest City at a later date, the person familiar with the Atlantic Avenue property said.They'll have to, if the state condemns it.