Who says city government isn’t good for real estate?
David Bistricer’s Clipper Equity will take home nearly $15 million a year from taxpayers after negotiating new lease terms with two city agencies at one of his properties in Downtown Brooklyn.
According to PincusCo, the city’s Human Resources Administration and the Department of Environmental Protection will take a total of 342,000 square feet at 250 Livingston Street, with the new 10-year lease kicking in next year. At nearly $44 a square foot, Bistricer’s real estate investment trust stands to make an annual $14.94 million from the city agencies, double the current rent of $7.7 million, according to PincusCo’s analysis.
Though he won’t smart a $150 million windfall, Bistricer told PincusCo that the rent rate is actually below market. When the lease deal was first struck in 1997, the city was paying $20 a square foot for the space, hence a low-expiring rent.
In its first quarter Brooklyn office market report, Newmark Knight Frank pegged the average asking rent in the borough at $51 a square foot, with an availability rate at 15.9 percent.
In December, Bistricer landed a $75 million loan to refinance the mortgage on the property, which he bought in 2002 for $26 million.