The Real Deal New York

Waterbridge in $100M-plus contract on Williamsburg’s North 3rd St.

Properties are home to area hotspots such as Radegast Hall and Egg

September 16, 2014 04:06PM
By Hiten Samtani

Radegast Hall at 113 North 3rd Street

Radegast Hall at 113 North 3rd Street

Joel Schreiber’s Waterbridge Capital is in contract to lay out $100 million to buy multiple properties on North Third Street, including the buildings that house the popular beer garden Radegast Hall and brunch hotspot Egg, The Real Deal has learned. The investment firm will pay nearly $1,000 per square foot for the properties, its boldest bet yet on one of the city’s hippest neighborhoods.

Waterbridge is buying 103-119 North 3rd Street as well as 188-190 Berry Street, according to sources familiar with the transaction. The deal gives Waterbridge about 110,000 total buildable square feet, including more than 50,000 square feet of residential space with 41 rental units that are ripe for repositioning, sources said. The properties generate about $4 million in annual income, a source said. The properties also house several commercial units leased out to establishments such as Mast Brothers Chocolate and Mexican eatery Viva Toro. Those businesses are likely paying below-market rents, and will be repositioned over time. The area is also likely to see continued gentrification, perhaps best epitomized by the upcoming Whole Foods at the Cayre family’s 242 Bedford Avenue.

Still, it’s a lofty bet. Jared Epstein, a vice-president at Bobby Cayre’s Aurora Capital Associates, said the property had been shopped around for six months at the $100 million price tag.

“The price for the bricks is very high,” Epstein said. “The income in place which throws off a sub 4% unlevered yield and slim foreseen upside turned off most investors. Waterbridge has a great track record of finding value where others have not, I wish them the best of luck with this acquisition.”

Eastern Consolidated’s Gabriel Saffioti and Nicole Rabinowitsch are believed to have brokered the transaction. Representatives for the firm couldn’t be immediately reached for comment. The seller, Olga Sosa, couldn’t be reached. Waterbridge declined to comment.

The latest deal gives Waterbridge control over a large swath of the area. The firm recently acquired 158-160 North 4th Street, 151-173 North 3rd Street and 237-241 Bedford Avenue in partnership with RedSky Capital for upwards of $66 million. Waterbridge will develop about 50,000 square feet of retail space and 39 residential units on that package.

  • Crian Bashman

    Do these people realize that the reason people go to Williamsburg is for places like Radegast and Mast Brothers. Once you replace them with sterile chains there is no reason to visit or live there.

    • Adam Levine

      Spot on. I am usually one to be all for new development but loosing these establishments will be a huge loss for the area.

    • scuds

      Yes, BUT… Eventually the 20-something hipsters become 30-somethings and settle down and have kids and stop going to bars and eating out as much. The neighborhood changes and can only support fewer, more mediocre restaurants and almost all the residents are happy for the convenience of “sterile chain” stores and banks and national retailers. A small, but vocal minority laments all this but it happens again and again in NYC. Look at the history of Columbus Ave, or 5th in Park Slope or Smith Street. It’s happening to Williamsburg now, and will happen to Bushwick next, then Franklin in Bed Stuy and Crown Heights, and eventually in St George or wherever the hot neighborhood of 2040 is.

      • Crian Bashman

        5th Ave in Park Slope hasn’t been turned into a stretch of sterile chain stores. Yes, the Southpaws and Bar4s are gone, but it is not like Mast Brothers and Radegast appeal only to the 20-something “hipsters”. Smith Street is full of interesting bars and restaurants, not chain stores and duane reades. The 30 somethings staying with kids don’t want what you think they want either. It is part of the reason why they are pushing out further into places like Crown Heights and Bed-Stuy. The problem is the industry just doesn’t get that these people are moving to these places because they reject the sterile chains you think they desire.

      • akrnyc

        Smith Street is far from an endless row of sterile banks and corporate chains. A few of my favorite independent restaurants and retail outlets still exist (and thrive) on Smith. RIP Williamsburg of the 90s and early 2000s (when I lived in NY).

      • savorysalmon

        yeah but when there’s nowhere affordable to live in the area…

        the last thing any part of this city needs is more developments.

        • scuds

          You have absolutely no understanding of economics. rule #1: less supply = more demand and more supply = less demand. What NYC needs for there to be affordable places to live is MANY more developments. Do you think that if there is less construction in a desirable area that prices will magically decrease, or can you try to understand that scarcity will drive prices even higher?

          • savorysalmon

            you have absolutely no understanding of nyc housing (see how that works?)

            developments don’t mean affordable housing. this city needs more affordable housing, not super unaffordable housing. walk down through all the finished developments in LIC after sunset and you’ll find most of the lights turned off, no one living there. so many people i know are priced out left and right. and for what? so some rich guy or girl can come in and use this place as an alternate residence that they only spend a few months a year in? that’s not right

  • MisterVanBuilderAss

    If you build it they will come. Well if the price is too high they will go elsewhere.

  • Beware

    Who’s money did Schreiber steal this time to do the deal ?

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