weirfield · due diligence l. executive summary. 6 b6 real estate advisors weirfield development...

WEIRFIELD DEVELOPMENT PACKAGE

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FOR MORE INFORMATION,PLEASE CONTACT

DJ JOHNSTONPartner, Senior Managing Director646 933 [email protected]

WILLIAM CHENGDirector 646 933 [email protected]

MICHAEL MURPHYSenior Associate646 933 [email protected]

BEN RECHLERAssociate646 933 [email protected]

TABLE OF CONTENTS

I. EXECUTIVE SUMMARY

II. THE NEIGHBORHOOD

III. DUE DILIGENCE

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EXECUTIVE SUMMARY

6 B6 REAL ESTATE ADVISORS 7WEIRFIELD DEVELOPMENT PACKAGE

B6 Real Estate Advisors is pleased to announce that it has been retained on an exclusive basis to arrange for the sale of this extensive residential development assemblage located on the Halsey L train station in Bushwick, Brooklyn. The portfolio features roughly 78,199 buildable square feet, just steps from the L train, with convenient access to Union Square and Williamsburg within 20 minutes. The large scale of this offering, truly uncommon for the Bushwick area, provides developers with the critical mass necessary to create their own community in what has become one of New York City’s most sought after neighborhoods.

As the long history of New York City neighborhoods such as Soho, Chelsea, Williamsburg, DUMBO and Greenpoint would suggest, residents being priced out of mature neighborhoods will always travel along transportation lines to neighboring areas where they can live more comfortably. With an influx

of new restaurants, cafes, bars, art galleries, retail stores and creative work lofts, Bushwick, Brooklyn has emerged as one of the fastest growing and most sought after real estate markets in all of New York City. From an investment perspective, Bushwick presents a rare opportunity to purchase real estate in a stable yet rapidly appreciating neighborhood at a significant discount as compared to similar neighborhoods like Williamsburg and Greenpoint. The most compelling trend is the fact that rental rates in Bushwick have outpaced many other Brooklyn neighborhoods, while multifamily values have remained significantly lower by comparison. Over the course of one year, the average rent for a one bedroom in Bushwick increased by 11.3%, well above the industry average. Despite this enormous increase, property values in Bushwick are still significantly lower as compared to similar offerings in Greenpoint and Williamsburg. This presents an ideal scenario for a forward-looking investor.

THE OPPORTUNITY PROPERTY INFORMATION

ADDRESS389

WEIRFIELD391

WEIRFIELD1438

HANCOCK 376

WEIRFIELD378

WERFIELD380

WEIRFIELDSUMMARY

Block / Lot 3400 / 68 3400 / 63 3400 / 35 3407 / 21 3407 / 26 3407 / 27 --

Lot Size 30.54' x 100' 100.4' x 100' 30' x 200.21' 100.37' x 100'26.44' x 100'

Irreg.30.33' x 196'

Irreg.--

Lot SF 3,054 10,040 6,006 10,037 2,153 5,850 37,140

Zoning R6 R6 R6 R6 R6 R6 / M1-1 --

FAR 2.20 2.20 2.20 2.20 2.20 2.20 / 1.00 --

Residential BSF 6,719 22,088 13,214 22,081 4,737 6,435 75,274

Commercial BSF -- -- -- -- -- 2,925 2,925

Total Buildable SF 6,719 22,088 13,214 22,081 4,737 9,360 78,199

IRVING AVENUE

WYCKOFF AVENUE

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21

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68

2627

COMMERCIAL BSF

2,95030’ x 100’ x 1 Floor

RESIDENTIAL BSF

42,021130’ x 65’ x 5.5 Floors

BLOCK 3400

BLOCK 3407

RESIDENTIAL BSF

33,253100’ x 65 x 5.5 Floor

RESIDENTIAL BSF

75,274TOTAL BSF

78,199COMMERCIAL BSF

2,925

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PROPOSED DEVELOPMENT SCHEME TAX MAP

Total Buildable SF: 78,199Residential BSF: 75,274M1-1 BSF: 2,925

IRVING AVENUE

WYCKOFF AVENUE

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To avoid underground parking and maximize efficiency of building layouts and amenities, we are suggesting you mass out all of your residential FAR next to on grade parking. We suspect this would save you roughly $3M in hard costs.

393 WEIRFIELD STREETBLOCK 3400 / 68,63,35

PARKING – 33 SPACES

PARKING – 25 SPACES

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376 WEIRFIELD STREETBLOCK 3407 / 21,26,27

65’

130

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100

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65’

RESIDENTIAL BSF – 42,021130’ X 65’ X 5.5 FLOORS

5.5 FLOORS OF RESIDENTIAL

COMMERCIAL BSF – 2,95030’ X 100’ X 1 FLOOR

1 FLOOR OF RETAIL OR PARKING

RESIDENTIAL BSF – 33,253100’ X 65’ X 5.5 FLOORS

5.5 FLOORS OF RESIDENTIAL

200.21’

100’

100’

100’

169

.98

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130

.94

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30

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30

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196.33’

96.67’

156

.81’

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.94

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PROPERTY PHOTOS


The subject property is an 18 minute train ride from Manhattan and less than 25 minutes from Midtown via transfer.

Weirfield Development Package is conveniently located within just steps of the L train’s Halsey Street station.

Multiple bus options are also available with the B20, B26, B38, Q39, Q55, and Q58 lines, providing direct connections throughout Brooklyn and Queens that is conveniently located within close proximity to the property.

By car, there is easy access to Manhattan via the Williamsburg Bridge, Brooklyn Bridge, Manhattan Bridge an Queens Midtown Tunnel. The property is ideally situated in close proximity to the Brooklyn-Queens Expressway (Interstate 278), accessible within 3.3 miles of the property, connecting to most major thoroughfares in Brooklyn and Queens.

The three major metropolitan airports, John F. Kennedy (17.5 miles), LaGuardia (8.9 miles), and Newark (19.5 miles) are located in the immediate Metropolitan area.

TRANSPORTATION

14th ST - UNION SQUARE21 Minutes

1st AVENUE / EAST 14th STREET18 Minutes

BEDFORD AVENUE STATION13 Minutes

25 Minutes 34th ST - HERALD SQUARE

PATH34th ST - PENN STATION

26 Minutes

LIRR, PATH, NJ TRANSIT & AMTRAK

42nd ST - GRAND CENTRAL26 Minutes

METRO NORTH

42nd ST - TIMES SQUARE26 Minutes

HALSEY STREETSTATION

WEIRFIELDDEVELOPMENT

PACKAGE

31 MinutesFULTON CENTER STATION

PATH

NEIGHBORHOOD


BUSHWICK

Bushwick is a neighborhood in northern Brooklyn, bounded by Flushing Avenue, Broadway, the borough of Queens, and the Cemetery of the Evergreens. With 142,934 residents (2013) across 1.3 square miles, the neighborhood is undergoing a dramatic transformation. Over the last decade, the vicinity – historically home to big breweries – has witnessed a surge of development; emerging from the shadow of neighboring DUMBO and Williamsburg as a world-renowned haven for creative types. With the area’s convenient access to mass transit and comparatively low rents, Bushwick is now the edgy locale for millennial hipsters to work and live. To meet this demand, owners and developers are steadily constructing residential buildings, along with restaurants, bars, and entertainment options. Once an afterthought, this old industrial neighborhood is enjoying a diverse revitalization.

The implementation of a new gravity-fed water system in 1859 provided Brooklyn with drinking water from Long Island lakes. With its low mineral content, the water was ideal for brewing. Within 30 years, 14 breweries had opened in Bushwick, establishing the community’s position as the center for American brewing. The success of the breweries also led to the construction of several mansions along Bushwick Avenue,

which served as homes for the neighborhood’s industrial magnates. In addition to its stately mansions, Bushwick was home to many architecturally magnificent churches, including St. Mark’s Lutheran Church (built in 1892), the South Bushwick Reformed Church (constructed in 1853) and Saint Barbara’s Roman Catholic Church (erected in 1910) -- each a testament to the large German population, and the influx of immigrants from Russia, Italy, Ireland and Poland.

Due in large part to the efforts of the city, state and federal government, as well as private and nonprofit organizations, Bushwick is enjoying a major cultural renaissance. Selected as the “Seventh Coolest” neighborhood in the world by Vogue, Bushwick is now a trendy locale. With hundreds of artist studios and more than 50 gallery spaces, the neighborhood is an attractive refuge for artistic types and younger people who are being priced out of areas like Williamsburg and DUMBO. The Bushwick Collective, which invites the world’s premier street artists to paint murals on neighborhood walls, is representative of the area’s personality, as it has helped change the energy of the neighborhood and spur the transformation from industrial wasteland into thriving creative hub.


RETAIL & AMENITIES

LIFESTYLERESTAURANTS & BARSCULTURE & ENTERTAINMENT

GOLDEN THAIST. MARTIN OF TOURS INDUSTRY1332 IRVING SQUARE PARK BONUS ROOM THE SOPRANOS


PACKAG E


HIGHLIGHTED DEVELOPMENTS

# ADDRESS PROPERTY TYPE GROSS SF STORIES UNITS

1 10 Montieth Street Residential 270,000 7 398

2 123 Melrose Street Residential 375,000 8 385

3 338 Evergreen Avenue Mixed Use 304,761 5 180

4 232 Siegel Street Hotel 97,345 10 144

5 25 Stewart Avenue Hotel 79,798 9 140

6 1601 DeKalb Avenue Residential 125,252 9 122

7 871 Bushwick Avenue Mixed Used 150,825 6 114

8 198 St. Nicholas Avenue Residential -- 7 99

9 8 Palmetto Street Mixed-Use 103,378 7 88

10 405 Evergreen Avenue Mixed Use 47,265 5 68

11 600 Bushwick Avenue Residential 63,000 6 64

12 336 Himrod Street Mixed Use -- 5 63

13 963 Willoughby Avenue Residential 43,000 5 63

14 387 Bushwick Ave Mixed Use 49,000 7 60

15 1 DeSales Place Mixed Use 50,215 8 58

16 301 Himrod Street Mixed-Use 50,000 11 55

17 668 Bushwick Avenue Mixed Use 53,887 6 52

18 962-966 Bushwick Avenue Mixed-Use 52,000 7 48

19 885 Bushwick Avenue Residential 37,087 6 46

20 889 Bushwick Avenue Residential -- 6 46

21 380 Grove Street Mixed-Use 49,000 7 41

22 1127 Willoughby Avenue Mixed-Use 30,000 9 32

23 1562 DeKalb Avenue Mixed-Use 32,000 6 30

24 144 Bleecker Street Residential 17,512 5 26

25 951 Madison Street Mixed-Use 47,780 7 39

26 342 Eldert Street Residential 66,668 4 60

27 345 Eldert Street Mixed-Use 78,000 4 57

28 785 Knickerbocker Avenue Residential 27,000 4 38

29 333-335 Irving Avenue Mixed-Use 70,000 13 71

30 801 Wyckoff Avenue Residential 62,564 5 54

123 MELROSE STREET 801 WYCKOFF AVENUE

962-966 BUSHWICK AVENUE 785 KNICKERBOCKER AVENUE

1601 DEKALB AVENUE

10 MONTIETH STREET 333-335 IRVING AVENUE

338 EVERGREEN AVENUE 342 ELDERT STREET

1127 WILLOUGHBY AVENUE


PACKAG E

22 B6 REAL ESTATE ADVISORS

DUE DILIGENCE


R6 zoning districts are widely mapped in built-up, medium-density areas in Brooklyn, Queens and the Bronx. The character of R6 districts can range from neighborhoods with a diverse mix of building types and heights to large-scale “tower in the park” developments such as Ravenswood in Queens and Homecrest in Brooklyn. Developers can choose between two sets of bulk regulations. Standard height factor regulations, introduced in 1961, produce small multi-family buildings on small zoning lots and, on larger lots, tall buildings that are set back from the street. Optional Quality Housing regulations produce high lot coverage buildings within height limits that often reflect the scale of older, pre-1961 apartment buildings in the neighborhood.

HEIGHT FACTOR REGULATIONSBuildings developed pursuant to height factor regulations are often tall buildings set back from the street and surrounded by open space and on-site parking. The floor area ratio (FAR) in R6 districts ranges from 0.78 (for a single-story building) to 2.43 at a typical height of 13 stories; the open space ratio (OSR) ranges from 27.5 to 37.5. Generally, the more open space, the taller the building. In the diagram, for example, 81% of the zoning lot with the 13-story building is required to be open space (2.43 FAR x 33.5 OSR). Thus, the maximum floor area ratio is achievable only where the zoning lot is large enough to accommodate a practical building footprint as well as the required amount of open space. There are no height limits for height factor buildings although they must be set within a sky exposure plane which begins at a height of 60 feet above the street line and then slopes inward over the zoning lot.

Off-street parking is generally required for 70 percent of a building’s dwelling units, but requirements are lower for income-restricted housing units (IRHU) and are further modified in certain areas, such as within the Transit Zone and the Manhattan

Core, or for lots less than 10,000 square feet. Parking can be waived if five or fewer spaces are required.

QUALITY HOUSING REGULATIONSThe optional Quality Housing regulations produce high lot coverage buildings set at or near the street line. Height limitations ensure that these buildings are often more compatible with older buildings in the neighborhood. As an incentive for developers to choose the Quality Housing option outside the Manhattan Core, greater floor area ratio, and therefore, more apartments, is permitted for buildings on or within 100 feet of a wide street than would be permitted under height factor regulations. The FAR is 3.0; the maximum base height before setback is 65 feet with a maximum building height of 75 with a qualifying ground floor (70 feet without). On a narrow street (beyond 100 feet of a wide street), the maximum FAR is 2.2; the maximum base height before setback is 45 feet with a maximum building height of 55 feet. The area between a building’s street wall and the street line must be planted and the buildings must have interior amenities for the residents pursuant to the Quality Housing Program.

Higher maximum FAR and heights are available for buildings participating in the Inclusionary Housing Program or that provide certain senior facilities.

Off-street parking is generally required for 50 percent of a building’s dwelling units, but requirements are lower for income-restricted housing units (IRHU) and are further modified in certain areas, such as within the Transit Zone and the Manhattan Core, or for lots less than 10,000 square feet. Parking can be waived if five or fewer spaces are required.

Source: The Department of City Planning website.www1.nyc.gov. January 2017.

ZONING R6


ZONING M1

M1 districts range from the Garment District in Manhattan and Port Morris in the Bronx with multistory lofts, to parts of Red Hook or College Point with one- or two-story warehouses characterized by loading bays. M1 districts are often buffers between M2 or M3 districts and adjacent residential or commercial districts. M1 districts typically include light industrial uses, such as woodworking shops, repair shops, and wholesale service and storage facilities. Nearly all industrial uses are allowed in M1 districts if they meet the stringent M1 performance standards. Offices, hotels and most retail uses are also permitted. Certain community facilities, such as hospitals, are allowed in M1 districts only by special permit, but houses of worship are allowed as-of-right.

In M1-5A and M1-5B districts mapped in SoHo/NoHo, artists may occupy joint living-work quarters as an industrial use. Other than M1 districts paired with residence districts in Special Mixed Use Districts, M1-5M and M1-6M districts (by special permit) and M1-D districts (by authorization or certification) are the only manufacturing districts in which residences are permitted. However, in M1-6D districts, residential use may be allowed as-of-right on zoning lots under certain conditions.

In M1-5M and M1-6M districts, mapped in parts of Chelsea, space in an industrial building may be converted to residential use, provided a specified amount of floor area is preserved for particular industrial and commercial uses.

Floor area ratios in M1 districts range from 1.0 to 10.0, depending on location; building height and setbacks are controlled by a sky exposure plane which may be penetrated by a tower in certain districts. Although new industrial buildings are usually low-rise structures that fit within sky exposure plane, commercial and community facility buildings can be constructed as towers in M1-3 through M1-6 districts. In the highest density manufacturing district, M1-6, mapped only in Manhattan, an FAR of 12 can be achieved with a bonus for a public plaza. Except along district boundaries, no side yards are required. Rear yards at least 20 feet deep are usually required, except within 100 feet of a corner.

Parking and loading requirements vary with district and use. M1-1, M1-2 and M1-3 districts are subject to parking requirements based on the type of use and size of an establishment. For example, a warehouse in an M1-1 district requires one off-street parking space per 2,000 square feet of floor area or per every three employees, whichever would be less. Parking is not required in Long Island City or M1-4, M1-5 and M1-6 districts, mapped mainly in Manhattan. Requirements for loading berths of specified dimensions differ according to district, size and type of use.

Source: The Department of City Planning website.www1.nyc.gov. January 2017.


AFFORDABLE NEW YORK PROGRAM

Formerly known as the 421-A program, the new Affordable New York Program restored tax exemption benefits for new residential construction. Below is a general outline of the program. This information is subject to change and should only be used for general reference.

The new program is available to rental projects that commenced on or after January 1, 2015 and before June 15, 2022. The project must also be completed on or before June 15, 2026.

Projects that commenced prior to January 2016 and have not received benefits but comply with the provisions of the Affordable Housing New York Program, may receive benefits pursuant to this program.

Below is an outline of three of the seven affordability options that developers may choose from:

OPTION A• 10% of the rental units are offered at no more than 40% AMI• 10% of the rental units are offered at no more than 60% AMI• 5% of the rental units are offered at no more than 130% AMI• Years 1 through 25 receive a 100% exemption; only the “mini tax” (calculated on assessed value prior to construction) must be paid• Years 26 through 35 receive 25% exemption, requiring that 75% of the taxes including the “mini tax” be paid• These projects are also eligible to receive tax exempt bonds and tax credits

OPTION B• 10% of the rental units are offered at no more than 70% AMI• 20% of the rental units are offered at no more than 130% AMI• Years 1 through 25 receive a 100% exemption; only the “mini tax” must be paid• Years 26 through 35 receive a 30% exemption, requiring that 70% of the taxes including the “mini tax” be paid• These projects are eligible for substantial government assistance

OPTION C• 30% of the rental units are offered at no more than 130% AMI• Years 1 through 25 receive a 100% exemption; only the “mini tax” must be paid• Years 26 through 35 receive 30% exemption, requiring that 70% of the taxes including the “mini tax” be paid• This option is not available in Manhattan south of 96th Street

Furthermore, the program established three “enhanced affordability areas”. Among them are Brooklyn’s Community Boards 1 and 2 within one mile of the bulkhead along the East River. In these areas, new residential buildings with 300 or more rental units may qualify for an “enhanced 35-year benefit” as long as they meet additional criteria, not outlined in the general overview.

Source: “Statement and Summary: Affordable New York Housing Program.”REBNY. www.rebny.com. April 12, 2017.


TAX BILLS376 WEIRFIELD STREET

378 WEIRFIELD STREET




CONFIDENTIALITY & CONDITIONS

The information contained in this offering memorandum (“Offering Memorandum”) is proprietary and strictly confidential. This Offering Memorandum was prepared by and is the property of B6 Real Estate Advisors LLC (“B6”) and has been reviewed by the owner (the “Owner”) of the Property. It is furnished solely for the purpose of review by a prospective purchaser of the Property and is not to be used for any other purposes or made available to any person without the express written consent of the Owner or B6. By accepting this Offering Memorandum, the party in possession hereof agrees to return it to B6 immediately upon request of B6 or Owner. No portion of this Offering Memorandum may be copied or otherwise reproduced or disclosed to anyone without the prior written authorization of B6 and Owner. Each prospective purchaser and/or broker proceeds at his, her or its own risk.

You have the obligation to keep this Offering Memorandum, and any various papers, documents, legal instruments, studies, leases, brochures, computer output, and other materials concerning the Property (all of the aforementioned information is collectively referred to as “Evaluation Material”) confidential. Certain Evaluation Materials, including the leases, are described in summary form. The summaries do not purport to be complete nor accurate descriptions of the full agreements involved, nor do they constitute a legal analysis of such documents.

The information in this Offering Memorandum has been compiled from sources deemed to be reliable and does not purport to be all-inclusive or to contain all of the information which a prospective purchaser may desire. Neither B6 nor the Owner makes any representation or warranty whatsoever regarding the accuracy, veracity, or completeness of the information provided herein and each of Owner and B6 (and their agents, advisors and representatives) expressly disclaim any and all liability for representations or warranties, express or implied, contained in this Offering Memorandum or the Evaluation Material or for omissions therefrom.

Financial projections and information contained herein and in any Evaluation Material, shall not be relied upon, are provided for general reference purposes only, and are based on assumptions relating to (and subject to) the general economy, market conditions, competition, and other factors beyond control and, therefore, are subject to material change, volatility or variation. A prospective purchaser must make its own independent investigations, projections, and conclusions regarding the acquisition of the Property. This includes legal, tax, environmental, engineering and other as deemed necessary relative to a purchase of the Property. This Offering Memorandum does not constitute an offer to accept any investment proposal but is merely a solicitation of interest with respect to the investment described herein. This Offering Memorandum does not constitute an offer of securities.

The Owner expressly reserves the right, at its sole discretion, to reject any offer to purchase the Property or to terminate any negotiations with any party, at any time, with or without written notice. The Owner and B6 reserve the right to negotiate with one or more prospective purchasers at any time. This Offering Memorandum is subject to errors, omissions, changes or withdrawal without notice and does not constitute a recommendation, endorsement or advice as to the value of the Property by B6. Only a fully-executed real estate purchase agreement, approved by the Owner, and executed and delivered to Owner and a prospective purchaser shall bind the property. In no event shall a prospective purchaser have any claims against the Owner or B6 or any of their affiliates, officers, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property.

The terms and conditions set forth above apply to this Offering Memorandum in its entirety.

TAX BILLS391 WEIRFIELD STREET

1438 HANCOCK STREET

B6 REAL ESTATE ADVISORS1040 Avenue of the Americas, 8th FloorNew York, NY 10018

FOR MORE INFORMATION, PLEASE CONTACT ONE THE FOLLOWING INDIVIDUALS

DJ JOHNSTONPartner, Senior Managing Director646 933 [email protected]

WILLIAM CHENGDirector 646 933 [email protected]

MICHAEL MURPHYSenior Associate646 933 [email protected]

BEN RECHLERAssociate646 933 [email protected]

FOR QUESTIONS ABOUT FINANCING, PLEASE CALL

STEVEN SPERANDIOPartner, Sr. Managing Director646 933 [email protected]

PETER CABRERAAssociate646 933 [email protected]

weirfield · due diligence l. executive summary. 6 b6 real estate advisors weirfield development...

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