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Category: Apartments, Net Lease Retail Tags: -

Property Profile

1269 Broadway Bushwick, Brooklyn, NY
Leasable Area
9,700 sq. ft.

The Journey of a Successful 1269 Broadway Transaction with Matthews™


Matthews™ is excited to share the success story of the recent closing at 1269 Broadway in Bushwick, Brooklyn. This 9,700 square-foot mixed-use building was 28.5’ wide and 75’ deep across four floors and a fully usable basement. The 2,500 square foot retail space was delivered vacant, and the residential unit mix offered four large unrenovated free market units and two rent-stabilized units with an average rent of $500 per month. There was a stop work order against the building due to an unpermitted loft in one of the free-market units, and the building had accrued 75+ violations. In addition, a free-market tenant was in court for non-payment. The common areas and basement were in good condition despite the violations. Zoning allowed for an additional 3,500 SF of air rights that can be used later or sold to a neighbor.


The sales price was $1,530,000 or $158 per SF and $190,000 per unit. We projected a future rent roll of $225,000 with an NOI of $165,000. The assumed cost to renovate the building is in the range of $600,000, bringing the total cost to $2,150,000. This suggests a return on cost of 7.5% and a total basis of $215 per SF and $260,000 per unit. The new owner may have a different strategy or the means to renovate at a lower cost, which could increase returns.


The seller had owned the property since 1999 and decided to sell it so he could pay down a loan on a larger property in his portfolio. This is a common trend where owners sell specific properties to help stabilize their core buildings. Preserving equity and resizing debt has been the primary motivation in this market, and we were successful in helping this owner do that.


The challenge was finding a buyer quickly with local retail experience and an appetite to renovate around two rent-stabilized tenants. The free-market units were destabilized over 10 years ago, so paperwork was naturally limited, although there were no historical overcharge cases, and three of the four free-market units were delivered vacant. We were able to secure a reputable value add investor who we had transacted with before and was able to close quickly. In fact, the buyer bought one of the first parcels we ever sold back in 2010, a testament to our long track record of execution in Bushwick. While tours and negotiations took roughly two months, we were ultimately able to schedule a sit-down closing. The buyer executed as promised, and the seller was able to pay down their loan in time to ward off a default on their primary property.


With 15 years of experience selling investment properties in Brooklyn, with a heavy concentration in Bushwick, Bed-Stuy, and Crown Heights, our knowledge of the local market and significant experience securing the right buyers for any situation puts us in a position to truly help sellers during this difficult market. If we can be of service in any way or provide market data, please don’t hesitate to connect with us.


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