Eye On Real Estate: But Watchtower rare acreage 'not for sale at this time...'
By Lore Croghan
Brooklyn Daily Eagle
Jehovah, hear our prayer!
Eager developers have been trying to convince the Jehovah's Witnesses to sell the biggest bulldozed-and-ready-to-build development site in DUMBO – for a princely sum.
Would-be buyers who have approached the Watchtower about the three-acre site at 85 Jay St. are willing to pay $400 per buildable square foot for the land, a source told the Brooklyn Daily Eagle.
The prime location occupies a full block, bounded by York, Jay, Front and Bridge Streets. It is zoned for 880,000 buildable square feet, all of which can be residential, The Real Deal reported in 2010.
That would mean $352 million for the property, which is now a parking lot surrounded by a 10-foot metal fence topped with rolls of razor wire.
Wanna-be purchasers are number-crunching based on the assumption that condos built at 85 Jay St. will sell for $1,600 per square foot, the source said.
“This is the last great site in DUMBO,” said a second source, adding the property would be easy to build on because there's room on it to put a construction office and set up cranes and concrete trucks so no street closings would be necessary.
A builder who bought the site for $400 per developable square foot would make “an excellent profit” if condos go for $1,450 to $1,500 per square foot instead of the projected $1,600, which may be a “little bit high even two and a half years down the road,” this source said.
Luxury construction would cost less than $400 per square foot, including soft costs such as the interest on the construction loan, taxes and broker fees.
A spokesman for the religious organization confirmed that developers have been pursuing the site – but said the Watchtower is not ready to sell the property.
“Since the recent October sale of our five buildings in DUMBO, several qualified real estate developers have expressed interest in purchasing 85 Jay St.,” spokesman David Semonian said in an email.
“However, 85 Jay St. is not for sale at this time because of our need to continue using the property,” said Semonian – who noted that Watchtower officials have not hired a real estate broker to sell any of the DUMBO and Brooklyn Heights properties the organization continues to own.
In the past two years, the Witnesses have closed on the sale of 17 properties in the two neighborhoods as they prepare to move their world headquarters to a 253-acre location in upstate Warwick.
The transactions include five industrial buildings Semonian spoke of – which were purchased last month by the Kushner Cos., RFR and Invesco. (See related story for more details.)
Two real estate sources think that should the Watchtower decide the time is right to sell the massive Jay Street parking lot, condos built there would be able to command $1,600 per square foot.
“It's an extremely desirable area,” said one. “There's no reason apartment prices there won't set records in the borough of Brooklyn.”
Nine years ago, the Witnesses won a city zoning variance allowing residential construction at 85 Jay St. Architecture firm Beyer Blinder Belle drew up plans for four towers to house about 1,600 residents. The design included a three-story auditorium, a dining facility and a parking garage.
Neighborhood residents and community advocates who opposed the project thought it would “overwhelm the scale of the historic waterfront neighborhoods[,] destroying their sense of space” and said “the lack of retail would have long-term, deleterious effects on the emerging, mixed-use, DUMBO neighborhood,” according to a 2004 City Planning Commission document.
The Witnesses do not put retail spaces in their buildings because their charter prohibits them from doing so, the Planning Commission document noted.
The Witnesses got demolition permits in 1990 to tear down several residential and industrial buildings that then occupied the site.
Before they decided to go residential at 85 Jay St., they were thinking industrial. Plans filed with the city Buildings Department in the early 1990s called for construction of a six-story, 117-foot-tall factory building, 834,000 square feet in size.