From the December issue: New York City is known for its sky-high rents. But lately, tales of Brooklyn’s hot rental market have become as numerous as the 20-somethings flooding into the borough.

Two Trees recently finished leasing up its 103-unit rental at 25 Washington Street in Dumbo, where all 80 of the market-rate units were rented in four months at prices of roughly $50 per square foot, according to company vice president Jed Walentas. At JMH Development’s 184 Kent Avenue, a Williamsburg warehouse converted into a 340-unit rental building, leasing was completed within 10 months, according to Jason Halpern, managing partner at JMH. Now, with some of those leases starting to turn over, interest in the building is stronger than ever — so strong that the rental office inked eight new leases and fielded 25 walk-in inquiries during one week last month, Halpern said. [more]

Two Trees Management has secured $229 million in construction financing for the second phase of its massive Mercedes House development on the Far West Side, according to Morrison & Foerster, the law firm that represented lenders Wells Fargo and JPMorgan Chase in the deal.

About 60 percent of the loan comes from proceeds of bonds issued by the New York State Housing Finance Agency which will fund about 480 units, 100 of which are reserved for low-income households. The remainder will finance 162 residential condominium units. – Adam Fusfeld [more]

The penthouse triplex at 1 Main Street in Dumbo

The now somewhat famous Clock Tower triplex penthouse by developer
David Walentas at 1 Main Street in Dumbo has been chosen as Esquire
magazine’s bachelor pad, the magazine said today. The unit will be
host to various celebrity and charity events throughout the fall and the magazine’s annual design showcase. This will
be the first time the bachelor pad has come to Brooklyn.

“The Esquire Apartment concept was conceived in New York in 2003,”
noted Jack Essig, senior vice president, group publishing director and chief revenue officer of Esquire. “Although we create our house every other year in Los
Angeles, this is the first time we’ve taken our New York project to a
location outside of Manhattan. We really challenge ourselves every
year to find a new prime neighborhood and a building that represents
the essence of the magazine.” — Katherine Clarke [more]

From left at the Brooklyn Real Estate Summit: Tim King of CPEX, Joe Chan of the Downtown Brooklyn Partnership and Michael Phillips of Jamestown; Michael Zazza of the Zazza Development Group and Susan Pollock of CPC Resources

Though the price disparity in their residential markets may be narrowing,
Brooklyn still lags far behind Manhattan in the number of big national
retailers. That was a major discussion point at the 2011 Brooklyn Real
Estate Summit held yesterday at St. Francis College in Downtown
Brooklyn. Not coincidentally, commercial real estate veterans pointed
to the very neighborhood where the conference took place, Downtown
Brooklyn, as crucial to landing those retailers.

“Brooklyn is too spread out to achieve national retailers in every business
district in the borough,” said Michael Phillips, managing director at
real estate investor Jamestown, which has stakes in Be@Schermerhorn in Downtown Brooklyn and four Manhattan buildings. But, by trumpeting Downtown Brooklyn, where retail traffic is already evident, Brooklyn
can lure the big-box national retailer willing to be a pioneer. [more]

The penthouse triplex at 1 Main Street in Dumbo

David Walentas’ famous Clock Tower triplex in Dumbo has been pulled from the rental market less than a week after making headlines as the priciest apartment up for lease in Brooklyn.

The 7,000-square-foot spread, which is still listed for sale for $23.5 million, had been asking $50,000 per month. The Post reported yesterday that listing broker and “Selling New York” star Michele Kleier, of Gumley Haft Kleier, was seeking a renter to sign a two-year lease with an option to buy, but she confirmed to The Real Deal this morning that time has already run out for that opportunity. She declined to comment further on her reasoning, but once again, if you want views of the New York Harbor and Brooklyn Bridge through those 14-foot glass-faced clocks, you’re going to have to buy them. [more]

City Joinery, a Dumbo-based furniture making company, is moving to Easthampton, Mass. after the landlord upped the rent by $3,000 on its 5,500-square-foot showroom and studio space at 20 Jay Street, bringing it to $8,000 a month, according to Crain’s.

Jonah Zuckerman, City Joinery’s founder and owner, said the rent hike made the space essentially unaffordable, especially since demand is lessening for wooden furniture since the recession.

“In the boom years, we would have a couple walk-ins and one or two appointments every day, so the showroom investment was totally worth it,” he said. “But in the past six months, we’d be lucky if we had one party a week.” [more]

Brooklyn-based real estate development firm Two-Trees Management has provided a 6,440-square-foot space at a highly subsidized rate for a new city-sponsored business incubator to support the development of technology start-ups in Dumbo, the city said today. The incubator, located at 20 Jay Street — one block from Brooklyn Bridge Park — is designed to accommodate technology entrepreneurs in New York City over the next three years.

Seth Pinsky, president of New York City Economic Development Corp., announced the plan this morning during an Internet Week NY panel on the city’s “Digital Corridors.” EDC has provided a $250,000 grant for the incubator as part of a major Bloomberg administration effort to encourage entrepreneurship. TRD [more]

For months, brokers have been describing the Manhattan luxury rental market as white-hot, and here’s further evidence: the 222-unit first phase of Two Trees Management’s new Mercedes House, which hit the market less than three weeks ago, is already 50 percent spoken for.

The 29-story building at 555 West 53rd Street, named after the 330,000-square-foot Mercedes-Benz showroom at its base, was designed by starchitect Enrique Norten and is priced from $2,200 per month.

Among the draws: floor-to-ceiling windows, views of the Hudson River, on-site parking and amenity menu that includes a health club, boxing ring, golf simulator, basketball and volleyball courts and both indoor and outdoor swimming pools. TRD [more]

The Mercedes House, a 29-story rental building at 555 West 53rd Street, is opening 222 of its 900-plus units for rent beginning this Sunday. Two Trees Management developed the building, the Brooklyn-focused firm’s first Manhattan property in 30 years, and enlisted Enrique Norten to design the zig-zagged glass tower. The Midtown building’s amenities include a health club, indoor and outdoor swimming pools, two outdoor decks, an indoor basketball court, golf simulator and a screening room. The Mercedes House was named after the 300,000-square-foot Mercedes-Benz showroom, and the car manufacturer’s American headquarters, located in the ground floor. TRD Comments

Two Trees Management has signed a deal with the city’s School Construction Authority to build a 300-seat middle school within its planned Dock Street residential tower, moving ahead a project that’s drawn criticism from the likes of actress Helen Hunt, historian David McCullough and director Ken Burns. According to the Brooklyn Paper, Two Trees, which is run by father-and-son development team David and Jed Walentas, has agreed to pony up the construction costs for the middle school. The facility will be on the Dock Street side of their future 17-story building and is slated for completion in time for the 2014 school year. Comments