The Real Deal New York

Meet the developer building market rate in Mott Haven

Joshua Weissman’s JCAL Development has built more than 200K sf in the Bronx over the last six years
By Eddie Small | May 17, 2018 11:30AM

From left: 131-135 Alexander Avenue, William Bollinger, 329 East 132nd Street and Joshua Weissman (Credit: Michael McWeeney and JACL)

From left: 131-135 Alexander Avenue, William Bollinger, 329 East 132nd Street and Joshua Weissman (Credit: Michael McWeeney and JCAL)

When Bronx Borough President Ruben Diaz Jr. released his annual development report for the borough this week, the top four projects were massive affordable housing complexes from prominent developers like Phipps Houses and BFC Partners. And even more such projects are coming to the Bronx, including a roughly 750-unit complex from Maddd Equities on River Avenue and 1,045-unit building from L+M Development Partners near Mill Pond Park.

JCAL Development, founded by outer borough developer Josh Weissman in 2012, has brought its share of affordable housing to the Bronx, too. But in another sign of a changing borough, its portfolio includes several market-rate developments, along with commercial tenants who seem geared toward cementing Mott Haven’s burgeoning hipster status.

The firm has brought more than 200,000 square feet of development with a mix of 150 market-rate and 58 affordable units to the borough. Its portfolio includes 131-135 Alexander Avenue, 136 Alexander Avenue and 55 Bruckner Boulevard, all in Mott Haven. And next month, JCAL and co-developer Altmark Group plan to start leasing at the BridgeLine at 329 East 132nd Street, its largest project to date.

Though JCAL’s projects are relatively small in scale, they’ve generated buzz. The developer is leasing a ground floor retail space at 131-135 Alexander Avenue to The Lit. Bar, the Bronx’s first bookstore since Barnes & Noble shuttered its Co-op City location in 2016.

JCAL officials said they’ve believed in the borough for decades and were happy to see other companies start to take an interest in it as well.

“We’ve always been big believers in the Bronx,” said company principal Bill Bollinger. “Despite some of the stigmatism way back in the day about it being unsafe and things like that, we always kind of knew it was a real gem.”

Mining the market

Weissman got his start in real estate in the late 1990s, managing the construction of two-, three- and four-family homes in Brooklyn and the Bronx for the now-defunct Jackson Development Group. He began developing multifamily properties in the Bronx in 2002, including condominium projects, and launched his own firm a decade later, with a focus on Mott Haven and Port Morris.

JCAL completed its first building at 55 Bruckner Boulevard in 2014. The site contains four market-rate rental units in addition to JCAL’s headquarters. The firm then moved onto slightly larger projects such as a five-unit market-rate building at 136 Alexander Avenue and a 14-unit residential property at 131-135 Alexander Avenue. Both contain ground floor commercial space.

The roughly 20-person firm has affordable housing projects on its books as well, including a completed 58-unit development at 950 Summit Avenue in Highbridge and a 75-unit, under-construction property at 2395 Frederick Douglass Boulevard in Central Harlem.

The BridgeLine on East 132nd Street is arguably JCAL’s most ambitious project to date. Rents at the 91-unit market-rate project will range from $1,500 to $3,000 a month.

The development’s pricier apartments will be well above Mott Haven’s median asking rent, which was $2,200 a month as of March, according to StreetEasy. This marked a solid increase from March 2014, when the median rent was $1,900 a month.

Weissman said they were going for a luxury feel at the BridgeLine, similar to what renters would find in Manhattan or Brooklyn.

“We have a ground floor gym, ground floor lounge,” he said. “We have a rooftop lounge, and we’re going to be offering a shuttle from the building to the 4, 5 and 6 trains.”

Mychal Johnson, a South Bronx activist, said members of the JCAL team had joined one of the walks that his organization hosts in the community, and he believes the company is working to develop a solid reputation in the neighborhood. But, he remained generally skeptical of the demand for luxury rentals in the South Bronx.

“When you have offerings in Manhattan with these free rents and no broker fees and a lot of incentives, are they really going to be able to get the money they’re looking for, and is the market really there for those units?” he said. “You have a great availability to stay in Manhattan at the same rates or lower.”

Mable Ivory, an Engel & Völkers real estate agent focusing on the South Bronx, maintained that there was a strong demand for market-rate housing in the area, and in some cases, she was finding tenants for her apartments faster than her Manhattan colleagues.

“It still takes some time, but I’m getting a lot of calls on what I have available right now, so I would say yes,” she said, referring to whether renters in the neighborhood were looking for market-rate units. “I think that when I look at my colleagues in my office, I’m renting my apartments a lot quicker than they are.”

Tracy Dembicer, a senior banker at KeyBank Real Estate Capital, which provided $22.1 million in funding for the BridgeLine, said she saw the project as “an opportunity to be part of an early resurgence in the South Bronx.”

“This area is really starting to boom,” she said.

The next Williamsburg?

Some of the commercial tenants coming to JCAL’s buildings would be right at home in Brooklyn’s trendier enclaves.

The Lit. Bar, an indie bookstore and wine bar, and Beatstro, a combination restaurant and music store focusing on hip-hop, are opening at the firm’s 131-135 Alexander Avenue later this year.

Alfredo Angueira, who runs the Bronx Draft House by Yankee Stadium, said JCAL approached him and his partner about opening a spot in Mott Haven. Although he was nervous about whether the neighborhood was ready to support a business like Beatstro, they eventually came to an agreement.

“I knew the area was changing, but my concern was that the demographics wouldn’t change in sufficient time for us to get people with disposable income and get people who were looking to go to the venue,” Angueira said. “They understood my concern. They were extremely accommodating with the lease terms.”

Bronxite Noëlle Santos has been spearheading a high-profile push to open The Lit. Bar in the Bronx for years. She said she had pretty much given up on Mott Haven as a home for her new business due to the area’s high rents until she encountered the JCAL team, who were enthusiastic about getting her in one of their buildings.

“They’ve been so supportive of my project, and this is my first time doing construction,” Santos said. “So they’ve been kind of handholding me through the process because this is not what I do.”

Santos said she is also very sensitive to the gentrification debate surrounding Mott Haven and wanted to make sure she didn’t end up working with a landlord who felt no actual connection to the neighborhood — something she didn’t feel was the case with JCAL.

“When I go to these community meetings, they’re there,” she said. “When we have panel discussions in the community about gentrification, they’re there.”

Another tenant of JCAL’s at 136 Alexander Avenue is the Italian restaurant Nobodys Pizza, one of many businesses in the neighborhood backed by Keith Rubenstein, the founder of Somerset Partners.

Although Rubenstein has backed away from his largest project in the area — he and the Chetrit Group recently sold 101 Lincoln Avenue and 2401 Third Avenue to Brookfield Property Partners for $165 million — he said he remains a big supporter of the work JCAL is doing and described Nobodys Pizza’s tenancy in their building as a win-win situation.

“We get along perfectly well, and they’re helpful,” he said. “I think we bring value, and I think they bring value.”

But despite the bevy of trendy establishments coming to the neighborhood, Bollinger said that he does not foresee Mott Haven transforming the way Williamsburg did. He argued that the character of the neighborhood in the South Bronx is much more established than it was in Williamsburg prior to its transformation.

“I think it’s going to be always Port Morris and Mott Haven,” he said. “I get the sense that Williamsburg had much more of a blank canvas at that point when things were happening.”

Weissman said he and his colleagues are constantly on the lookout for new neighborhoods in the Bronx to develop in, as they are already seeing signs that Mott Haven might get too expensive for them in the future.

“The prices that we are seeing land being marketed for do not pencil out for us,” Weissman said.

Bollinger, who previously worked for the economic development corporation SoBRO, said it’s important to develop a mixture of affordable and market rate housing in the area. He stressed that market-rate housing would be particularly important to the borough’s returning college graduates, who may not be as eager to escape the South Bronx as they once were.

“The key is making sure we don’t have brain drain,” Bollinger said. “Kids go to school, get their degrees, and they don’t want to move out of the borough anymore. Back in the day, the first thing you did was you got a job, and you moved out. That mindset has changed.”