Dear PLG Neighbors,
Prospect Park East Network and
several other community groups have been fighting the 23 story tower at
626 Flatbush Avenue because we believe it offers few benefits to our
community and many negatives. One of the reasons a developer could gain
such an outsize benefit at the expense of our neighborhood is that our zoning is outdated and does not match our needs.
Thanks to your signatures on petitions, the letters
you wrote to our elected officials, and your voices at our meetings, the
Department of City Planning has finally begun meeting with Community
Board 9 and members of the community to discuss rezoning to prevent
future towers and address other issues of concern to the community.
But what is "zoning"? How exactly does it affect
what can be built on your block, your quality of life and your business?
What exactly is "upzoning"? "downzoning?" What is "contextual zoning"?
Are changes planned for your block? How can you participate effectively
in the rezoning process? How is zoning related to affordable housing or
the retail environment? Are you concerned about parking, traffic, noise,
or crowding on subways?
To answer all these questions and more, Prospect
Park East Network, Prospect Lefferts Gardens Neighborhood Association
and the Parkside Empire | Flatbush Merchants Association are co-sponsoring
a zoning workshop with Tom Angotti, Professor of Urban Planning at
Hunter College, former City Planner, and Brooklyn resident.
Date: August 27
Time: 7-9 pm
Place: Tafari Cafe, 591 Flatbush Avenue
We hope to see you there!
20 comments:
This might sound like a secondary concern, but I think it's worth mentioning. Is there any way to encourage these developers to consider condos (including affordable ) instead of rentals? There's high demand in the area and barely a handful of coops.
Home ownership overall is better for the neighborhood potentially. Homeowners tend to stick around longer and have a larger stake in qualify of life in the neighborhood.
True, but we're looking at developers building 100's of units in Lefferts (Sullivan Place is Crown Heights, incidentally) in the next several years, especially if sections of Empire Blvd are converted to residential zones. Every planned building - 123 Parkside, 33 Lincoln, 626 Flatbush, and all of the builds on Clarkson are slated to be rentals.
The condo-rental calculation is really dependent on developers' assessment of the market. There were many condo projects that were forced to convert to rentals when they didn't sell after 2008, and developers lost a lot of money while carrying them empty. Since then most new non-ultra-luxury construction has been rentals. I think condos in this area would sell really well, but possibly not for the prices developers would want vs. the rental stream they can get in this very hot rental market.
I know Sullivan Place is in Crown Heights, but I had mentioned the building will have condos and it's only one block from the PLG catchment.
Sorry DP, I was getting Sullivan confused with Carroll or a street further up. Either way, with all of the new developments going up at present and in the near future in Lefferts, it would be great if some could be condos, and I am still wondering if there is anything that PPEN, CB9, Eric Adams, or anyone can do to encourage it.
So does that mean that there is still a chance that the developer will not be able to build 23 stories or is that building alreadyvabdone deal?
Cali: there is still an appeal to the supreme court decision. if the appeal is denied, the building goes up as advertised. Chances are slim that any modification will happen.
Rentals are safer for developers at this point. The extraordinary demand by young professionals has ensured that the apartments will be filled as soon as they're built. You know, it wasn't always thus. I can remember not so long ago when it was still a bit of a risk, particularly in un-hip neighborhoods.
The Q has said it before. The current environment is not sustainable. Eventually, a correction will come, meaning prices will come down, though probably not to "affordable" rates. Some buildings will get sold for firesale prices. No one is building for the future. This is all game of profiting as quickly as possible and passing on the risk. There is no one looking out for the longterm interests of our neighborhood - except us.
I'd say it's a done deal - and it will rent very quickly. The only change they might consider would be making some or all of them condos, which might not be a bad idea, but it would depend on their market estimates - and if they're betting on a big upside here, it might be better to ride the rental train until sales prices are where they want them and then cash out by converting the building to condos.
And I don't think they're expecting sales prices in PLG to come down any time soon Q - otherwise the time to sell would be now. Either that or they're projecting a crash in the near term (12 - 18 months). But with so many new construction projects in Manhattan selling based only on plans, I don't know why they wouldn't try that here, now, unless they expect to get more money down the road.
People are even renting before buildings are finished: http://therealdeal.com/issues_articles/renters-sign-off-floor-plans-too/?utm_content=buffer7e3b1&utm_medium=social&utm_source=plus.google.com&utm_campaign=buffer
And that, Babs, is why I believe we are in something frothy beyond reason. I mean, c'mon. Every time we say "this is nuts" it turns out to be nuts. Five times in my adult life that I can recall...financial speculation that turns bust.
Clarkson writes:
The current environment is not sustainable. Eventually, a correction will come, meaning prices will come down, though probably not to "affordable" rates.
If you mean that prices will hit a temporary peak, then retreat a little, before resuming their march toward a new peak, then yes, the NY City market will maintain its long-term behavior.
Some buildings will get sold for firesale prices.
No. Not unless there's an actual fire and it's necessary to clear the land for an entirely new building, which will cost a boatload, thereby bringing the total cost of the land and the cost of the new construction up to some new high, especially if the property is in a desirable neighborhood.
No one is building for the future.
That claim is just silly.
This is all game of profiting as quickly as possible and passing on the risk. There is no one looking out for the longterm interests of our neighborhood - except us.
Wrong again. Real estate developers who build rental units and retain the properties are holding onto the risk -- because they believe the risk is low and the profit from hanging on is high.
As for who's looking out for the neighborhood, the irony is almost too much to bear.
The lower the crime and the better the schools -- two examples of "looking out for the neighborhood" -- the higher will be demand for neighborhood space.
...I believe we are in something frothy beyond reason. I mean, c'mon. Every time we say "this is nuts" it turns out to be nuts.
Prices get out of whack when credit is too easily obtained. "Cheap mortgages for everyone" was the government's housing mantra till 2007. During the temporary downturn, there was a muffling of the car-dealers'-style of huckstering. "If you can arrive at our government approved lending office before noon today, you'll have a new home in an hour. Lousy credit, bad credit, no credit -- no problem, we don't care. After all, it's not our money we're lending."
Prices are also subject to supply, which in NY City is always restrained by a choke-hold. The greater the push for "affordable" housing, the greater the price/rent increase in all free-market housing. How long does it take to learn this lesson?
Five times in my adult life that I can recall...financial speculation that turns bust.
Only when the government mandates cheap mortgages for anyone and everyone does a real estate purchase become FINANCIAL speculation.
Is anyone in NY City holding real estate that would sell today for less than its purchase price?
There may be people in NY City who foolishly took out home-equity loans at the 2007 top of the market and are now underwater -- but they merely extracted their capital appreciation without selling their real estate. By doing so, they went from a no-risk situation to a high-risk setting.
As for other financial busts, well, I suppose the Internet Bubble is an example. But anyone who buys stocks of companies that are losing huge amounts of money AND promise to keep losing money for several years before possibly, maybe, potentially turning profitable is not an investor. He is the wildest form of speculator.
Amazon is one of several stocks of the Internet Bubble that had a business plan that made sense. Yet even Amazon went to the brink of collapse when its balance sheet became highly leveraged around 2001.
There are other successes, such as eBay, PayPal, et. al. And now the Internet is bigger than ever. So, sorry, no bust. Only a temporary set-back
Here, as long as there are a million apartments in the Rent Stabilization Program, as long as the pace of building is restrained, the pace of rezoning is glacial, the public schools and crime don't get worse, NY City real estate will stay on its upward trajectory.
On the other hand, maybe a terrorist act could chill the market. If something terrible happened more than once on the subway. Or in another public venue. But even that would have no lasting effect, as the aftermath of 9/11 has shown.
Thanks once again to the Wall Street Journal Editorial Board for commenting under the name NoSlappz...
Amazon still doesn't profit, dude. And it's turning out to be every bit as predatory as Wal Mart. Take the long view and you may be wrong on a number of your assumptions. Plus, the idea that all is well when market forces do their thing belies a huge discontent in this nation that will soon boil over. Again...take the long view.
You can only push people so far before they push back.
Amazon's net income in 2013 was $274 million; the company did post a loss of $39 million in 2012, but had net income of $631 million in 2011. But that's neither here nor there.
NYC real estate has always rebounded after every "crash" to reach new and ever-higher peaks. Prices today are far higher than even the heights of 2007. This means that anyone buying who holds onto that property for five years or more generally will have nothing to worry about. The people who risk being hurt by market fluctuations are those who look to sell in a shorter time period.
Apart from these periodic, and transitory, market fluctuations, only a sharp decrease in demand will cause any lasting and significant reduction in prices. In order to achieve this there would need to be a huge aspirational shift along the lines of the white flight that took place beginning in the 1960s -people have to stop wanting to live in NYC, and I don't see that happening anytime soon.
For every "normal" person priced out of the market, it seems there are two (or more) rich people wanting to move in - even if it is only for a $3 million pied a terre that's seldom visited. Perhaps when the transformation of NYC into a bland upscale shopping mall is complete the rich will grow bored and move on, at which point we'll be able to reclaim our city, or what will be left of it.
Amazon is back to losing big money in 2014. And to get a sense of how unprofitable they've been despite enormous sales, read this:
http://www.ibtimes.com/amazon-nearly-20-years-business-it-still-doesnt-make-money-investors-dont-seem-care-1513368
Feel free to buy their stock if you're feeling bullish!
Y'all have missed my point completely. I'm not talking about individual brownstones. I'm talking about big apartment buildings that have been leveraged to the hilt. We're just one downturn away from all the big money losing their shirts and dumping their properties. Oh, and it's not THEIR shirts in the first place. Never play with your OWN money!
I'm fully aware that if you buy a house in NYC you will eventually do well. But a lot of folks don't have decades...they move, they change jobs, they LOSE jobs or are forced to retire. Many DO get stuck, even in big ticket cities like NY and San Fran, and I know quite a few of them. It's never been as safe as you make it sound, unless you're a buy and hold kinda guy like the Q, who frankly lucked the hell out and never wanted to live anywhere else anyway.
About a dozen firms are cornering the market on Brooklyn apartment buildings, looking for fast profits. They need rent-stabilization to disappear, and if it doesn't, or if their investments sour for any reason, we'll take this dialogue up where we left it.
If y'all are right, well, the city will still have changed for the duller, and I'll buy you a gastro-beer.
Lastly before I go pick up my Tika Massala.
This whole issue of rent stabilization restraining the market gives me the creeps. Did it ever occur to the free-marketers that each and every one of these apartments is actually inhabited by real people? Even if they ARE the few rich ones with cheap rent.
My comments had nothing to do with rent stabilization, which I fully support, and apply equally to rentals and sales - no matter how many new (non-stabilized or temporarily stabilized in exchange for tax breaks) rental buildings they build, it seems there's always more demand, and for every family priced out of a two or three bedroom apartment (or who could never afford to live in one of the new construction ones in the first place) there are two or three (or more) young people sharing, for whom only $1000 a bedroom seems like a steal.
In terms of sales, I'm talking about co-ops, condos, and houses - all are trading at higher numbers than ever, with no sign of increases stopping any time soon.
There may be a certain number of firms looking to expand their holdings in Brooklyn, but I'd say "cornering the market" is a bit extreme, and most large apartment buildings in the borough are owned by smaller owners.
And the city already has changed for the duller (parts of it would be completely unrecognizable compared to only 10 years ago), and I'll take that beer, please.
Usually "leverage" is expressed as a percentage of value-- so yes, apartment building buyers are taking out larger loans, but banks are only willing to lend around 70% of value, which is lower than was the case in the 2000s. There are a lot of investors with a lot of cash in the marketplace and that is what is inflating prices, not excessive leverage.
The same thing is happening on the 1-4 family home side. The last two sales on my block were both well under 80% loan-to-value.. one buyer put down like 40% of the purchase price in equity. And everyone is talking about how difficult it is to get a mortgage.
So, you can't dispute that prices are a lot higher--but you also can't claim it's a house of cards built on leverage.
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