The Real Deal New York

Brause Realty to bring 250-unit rental project to LIC

Brause Realty is planning to bring an approximately 270,000-square-foot rental building to a vacant lot in the Court Square area of Long Island City, David Brause, president of the multi-generational family real estate firm, told The Real Deal.

The new building, at 44-30 Purves Street, will likely have between 250 and 300 units in total, Brause said. The building is slated to begin construction in 2014 and will likely be completed by 2015. Plans for the building are currently underway; an architect has not yet been selected.

Brause, which also owns the 700,000-square-foot Long Island City office tower known as 1 MetLife Plaza, acquired the development site, near Thompson Avenue, following a foreclosure auction this spring. The site was formerly controlled by developer and landlord Baruch Singer and investor David Weiss.

Singer and Weiss financed a residential project at the site in 2006 with a $13 million mortgage-backed loan from G3-Purves Street LLC, an entity which appears to be linked to Goldman Sachs. The lender filed to foreclose on the property last year after Singer and Weiss reportedly allegedly broke the terms of their non-recourse loan agreement with G3 by failing to pay $90,000 they owed in real estate taxes and several other liens against the property.

At the time of the auction, which took place in May, the property had an outstanding lien of $38.54 million. The lender took control of the property at the auction but later flipped it to Brause Realty.

Brause said his company paid $17.2 million for the site, though the sale has not yet appeared in public record.

Brause Realty will be building into what has become a major development boom in Long Island City, particularly for rentals. Approximately 1,900 new rental units hit the market in the second quarter of 2013, according to residential brokerage Modern Spaces’ mid-year market report for 2013.

Developer Rockrose is currently leasing a 700-unit rental tower called the Linc LIC and has plans for another 700-unit rental building at the former Electric Eagle building at 43-22 Queens Street, it was previously reported. Meanwhile, Heatherwood Communities is building a 142-unit rental building at 27th Street and 42nd Road.

Luxury rental prices in the neighborhood are averaging $53 per square foot, according to data from Modern Spaces.