The Real Deal New York

Under new ownership, 109 Gold goes rental

MNS tapped as exclusive marketing agent for Vinegar Hill building

March 27, 2012 10:00AM
By Katherine Clarke

From left: Russell Appell, president of Praedium, and exterior and interior shots of 109 Gold Street

A recently completed condominium building at 109 Gold Street in Vinegar Hill, which The Real Deal yesterday reported was purchased by the Praedium Group in a partnership with North End Equities earlier this month, is going rental, MNS, the exclusive marketing agent for the property, said yesterday.

The 33-unit building, which was designed by developer the Constellation Group as a condo and sold for $14.5 million March 6, is set to hit the rental market in two to four weeks, said Highlyann Krasnow, an executive vice president at MNS, after Praedium decided it made more sense to lease the units than sell them.

“The market itself [allows for] condos or rentals but the building works much better as a rental,” Krasnow said, citing the size of the units, which, at 478 square feet to 1,269 square feet, are on the small end for condos. She added that the building is eminently marketable as a rental for its high-end finishes, which are “much nicer than you’d usually expect in a rental.” She declined to comment on the prospective asking rents at the property.

The building also has a landscaped roof deck, courtyard and a gym. Some of the units come with private outdoor space.

As The Real Deal previously reported, Halstead Property took over marketing the project as a condo from Prudential Douglas Elliman in July, after a team of Mordechai Werde and Michael Ettelson struggled to sell the units. Selling the building was a challenge, they said, because it went to market in November 2010, far before construction was complete, an Elliman spokesperson told The Real Deal at the time. The units were asking prices ranging from $325,000 to $1.08 million. No units appear to have closed in the building. Halstead did not respond to a request for comment.

There will be no changes to the property itself in the move towards rental.

Charles Herzka, principal of North End Equities, told The Real Deal that the project had been brought to the firm’s attention last year as an underperforming and undervalued asset. They later brought Praedium on board as a partner. North End chose to go rental at the site, he added, because “the rental market is extremely hot.”

The market for rental properties in Brooklyn isn’t shabby: Rental prices continued to escalate rapidly over the last year, according to a recent report by MNS for February, as one- and two-bedroom apartments in the borough saw year-over-year rents increase 7.5 percent and 10.2 percent, respectively. The average rent for a Brooklyn studio was $1,686 last month, one-bedrooms’ monthly cost averaged $2,294 and two-bedroom prices settled at $2,950, according to the report.

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