There was a pretty stunning "30-Minute Interview" Wednesday in the Times's Real Estate page with Ofer Cohen, president and a partner in TerraCRG, a commercial brokerage and advisory company focused solely on Brooklyn.
Land prices, he was told, "have really shot up."
Land prices, he was told, "have really shot up."
His response:
Yeah, it’s amazing. We just traded a site on Fourth Avenue for $250 a buildable foot, and I remember the sites that we were selling at the end of the recession, in 2011, were like $100, $110 a buildable foot. The price more than doubled.
We sell development sites in Williamsburg now for $350, $365 a buildable foot. At the end of 2011 it was $150.
Keep in mind that development rights for the 8.5-acre Vanderbilt Yard, after a MTA-requested appraisal, were appraised in 2005 at $75/square foot. The MTA, faced with Forest City Ratner's request to renegotiate the deal, said in 2009 that it would be dangerous to get a new appraisal and seek new bidders because of the bad economy.
A new appraisal in 2010, which included some land over the railyard, valued development rights at more than $179/square foot.
Surely that value has grown. And Forest City, despite the costs of delay, and the obligations to build a new railyard, has seen the value of the property its controls grow. After all, thanks to an extension wrangled from the MTA in 2009, it hasn't even paid for most of the railyard.
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