Saturday, February 22, 2014

Stunning tales of Downtown BK real estate boom: Junior's site worth $50M; Catsimatidis site worth $200M

Junior's, the cheesecake restaurant at the corner of Flatbush and DeKalb avenue, will sell its newly valuable property and reoccupy the ground floor of a luxury residential building, and also set up a second location, likely close to the Barclays Center.

The Rosen family, as reported in the 2/18/14 New York Post, Junior’s move a cake walk, bought the property in 1981. City records say 1985, and indicate a mortgage of $575,000.

According to Bob Knakal of Massey Knakal, the site--now 17,000 square-foot restaurant on an 8,548 square-foot site--can be turned into 102,500 square feet of luxury condos, or perhaps 100-130 units. Post sources said the building could get between $45 million and $55 million.

The Brooklyn Paper paraphrased owner Alan Rosen as saying "Junior’s will open a second location Downtown, closer to Barclays Center."

Given that Junior's is already close to the Barclays Center, why would it need to move? Well, they do need a place to operate in the interim. And surely a location, say, at the old Triangle Sports building at Fifth and Flatbush avenues would allow Junior's to take advantage of arena crowds.

And let's face it, the profit from the current building site are so huge that Junior's can afford high asking rents near the arena. (Maybe they can afford to pay their employees more, and provide health benefits, which is why Junior's employees have been pushing for a union.)

The Catsimatidis fortune

Another smart/lucky land buyer was John Catsimatidis, CEO of the Red Apple Group, which owns real estate, oil refining, convenience stores and two supermarket chains: Red Apple and Gristedes.
The New York Times 2/19/14 offered THE 30-MINUTE INTERVIEW: John A. Catsimatidis:
Q. And there’s development in Downtown Brooklyn, around Myrtle and Flatbush Avenue.
A. In 2007 we were going to build this as one big project — it was a $500 million project — except none of the banks had $500 million. They had the problem. I bought this property about 30 years ago — three city blocks. We paid about $400,000. Now it’s been estimated, just the land alone, at $200 million.
Four residential buildings. We built the first one. It’s a rental, about 110 units — studios, one-, two-, three-bedrooms — with a Red Apple supermarket and a CVS store at the bottom.
We began construction on the next building in November — we’re up to the fourth floor. We should be finished by this fall. There will be around 220 to 230 rental units. Then I pressed the button on another building. We are supposed to start the foundation by March or April.
Then the minute we put the foundation in we start on the fourth building, a 40-story tower. It will be rental, but maybe we’ll put condos on the top 10 floors. We’re reserving our rights.
(Emphasis added)

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