The Real Deal New York

These Brooklyn rental properties had the highest 2016 tax assessments

Equity Residential’s 180 Montague Street topped the list, at about $10,500 per unit

June 03, 2016 07:00AM
By Ariel Stulberg and Will Parker

180 Montague Street, 55 Hope Street and 226 Taaffe Place

180 Montague Street, 55 Hope Street and 226 Taaffe Place

“In Brooklyn,” Benjamin Franklin said, almost, “nothing can be said to be certain, except death and taxes.”

The Real Deal, being a real estate publication, mostly sticks to the latter.

In our ongoing quest to document landlords’ tax bills, TRD turned to Brooklyn in search of the multifamily properties with the highest per-unit tax assessments, utilizing data from the Department of Finance tax rolls for the current year.

The top five most-taxed buildings represented the diversity of Brooklyn rentals, spanning five neighborhoods from Williamsburg to Red Hook.

Along with a building’s income, tax assessors consider its geographic location and its age and condition, as well as the expense required to maintain it, Marcus & Pollack LLP’s Joel Marcus told TRD.

As with the Manhattan dive, TRD only considered buildings with 100 or more units, to reduce the impact of commercial incomes on the properties’ overall assessment, though that impact was more modest in Brooklyn.

180 Montague Street, Brooklyn Heights
Total Units: 187
Estimated 2016 tax owed: $10,529 per unit

Sam Zell’s Equity Residential developed this 34-story, 182,000-square-foot tower, formerly known as Archstone Brooklyn Heights, in 1999.

The property’s 186 apartments, primarily one-bedroom units around 600 square feet, rent for about $3,700 per month on average, with some units going for as much $6,670 a month, according to StreetEasy. The building also has a 6,000-square-foot ground floor retail unit, occupied by Garden of Eden Marketplace, a grocer.

The building was Brooklyn’s most heavily taxed per unit in 2016 despite receiving a $4.4 million abatement.

55 Hope Street, Williamsburg
Total units: 118
Estimated 2016 tax per unit: $9,327 per unit

The 117-residential unit 55 Hope Street in Williamsburg owes the city a boatload of taxes this year. Residential units rent for $3,200 a month on average, according to StreetEasy. And if the retail portion weren’t a factor, that would mean that about 24 percent of the rent roll would be paid in taxes this year, so the real amount is probably a few ticks down from that. The warehouse-to-rental conversion was completed in 2012, but the developer, Jeffrey Gershon, does not receive any tax abatements for the property. Ground floor retail tenants at the address include a hardhat design company and an interior design company.

226 Taaffe Place, Bedford-Stuyvesant
Total units: 110
Estimated 2016 tax per unit: $7,570 per unit

This five-story, 130,000-square-feet building near the Crown Heights border, owned by Alma Realty, contains 109 apartments, all of which are studios averaging about 983 square feet, according to CoStar. The property also has a 4,000-square-foot retail space occupied by a C-Town grocery store.

167 Clermont Avenue, Fort Greene
Total units: 113
Estimated 2016 tax per unit: $7,321 per unit

The Clermont Armory, converted in 2000 by Strategic Construction and IBEC from an actual armory built in 1873, has an average monthly rental price under $2,500 per unit. The Child Study center occupies the building’s ground floor retail space. This rental building was originally financed by HDC’s “New Housing Opportunities” program, which provided for apartments geared toward middle income families. Furthermore, it still benefits from a J51 tax abatement, which does not appear in the annual notice of property value but does appear in the quarterly tax bills, which means the effective tax for Clermont Armory is quite a bit lower than the $7,321 per unit it would otherwise owe.

5 Delevan Street, Red Hook
Total units: 102
Estimated 2016 tax per unit: $6,850 per unit

The 114,000-square-foot former Monarch Luggage Co. factory is now entirely a residential property, owned by Noam Corporation, according to CoStar. Units there largely one-bedrooms which rent for about $2,300 on average.

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