From Foreclosure to Success: The Proven Strategies Behind the $3.25M Sale of a Brooklyn Warehouse

This vacant warehouse, which sold for $3,250,000, spans 6,700 square feet (62’ x 72’) and was bank-owned, delivered in “as is” raw condition. The building features ceiling heights ranging from 12 to 15 feet and is located directly across from The Denizen, Bushwick’s largest residential building. The final sale price equated to $485 per square foot.

Seller Profile – The seller was a lender who had recently foreclosed on the property. They acquired the original note in distress and managed the foreclosure process. This approach has become increasingly common.

Buyer Profile – The buyer, an experienced developer and investor in Bushwick, plans to use part of the warehouse for their business and lease out the remainder.

Challenges Faced

Pricing warehouse properties can be difficult, as industrial rents often don’t support the average sale price for industrial buildings in Brooklyn. This necessitates targeting value-add investors or end-users interested in utilizing the space for their own business.

Solution

To attract both end-users and investors, the agents crafted clean and compelling marketing materials. Unlike the typical, generic industrial setups, our marketing approach added flair to the warehouse listing. In Brooklyn, these properties often trade more like homes than traditional investment properties.

Key Strategies Implemented

• Highlight End-User Desires – Similar to home buyers, end-users have specific wants, such as truck access, higher ceilings, ample power, exposure, a flat floor, and a clean roof. Our marketing setup made sure these features were evident within the first 30 seconds. The agents utilized floor plans, aerial shots, and our internal marketing team to present the building in its best light.
• Know When to Act – Industrial buildings typically attract interest in the first week. However, immediate action on offers is not always necessary. In this case, the agents were patient and adhered to their marketing timeline. By the end of the 8-week marketing period, offers had naturally increased by 20%.
• Leverage Competition to Strengthen Terms – While multiple bids can drive up the price, in this market, the certainty of closing is equally crucial. The agents leveraged competition to guide buyers in tightening their terms. Despite having several buyers within the same price range, one buyer stood out due to their favorable terms and execution history.
• Anticipate Potential Issues – Before listing, the agents had an open discussion about possible obstacles such as environmental concerns, structural issues, outstanding litigation, or potential squatters. Addressing these issues upfront helped maintain a smooth negotiation process.

Outcome

These strategies culminated in the successful sale of 120 Evergreen Avenue for $3,250,000 to a hybrid investor/end-user. The backup buyers included a manufacturing end-user and a retail developer. By leveraging competition and maintaining momentum, the agents executed a clean contract and achieved a smooth closing with the right buyer.