Pair of DoBro properties up for sale by Slate, Meadow Partners

City Council approved rezoning for 570 Fulton Street earlier this year

Nov.November 04, 2019 12:03 PM
1 Flatbush Avenue and the site at 570 Fulton Street (Credit: Google Maps)

1 Flatbush Avenue and the site at 570 Fulton Street (Credit: Google Maps)

One of Downtown Brooklyn’s newest apartment towers as well as a site next door that can accommodate an even bigger one are for sale.

Developer Slate Property Group and its private equity real estate partner, Meadow Partners, have put the 19-story, 183-unit rental building they completed last year at 1 Flatbush Avenue on the market.

Slate and Meadow are also looking to sell the development site next door at 570 Fulton Street, which the city rezoned earlier this year to allow for a 40-story tower with 139 rental units and about 87,000 square feet of office space.

To get the rezoning, Slate and Meadow agreed to make 35 to 42 of the units affordable, hire union building workers, hire locally and work with the Metropolitan Transportation Authority to make the Nevins Street subway station in front of the site compliant with the Americans with Disabilities Act.

A spokesperson for Slate — headed by David Schwartz and Martin Nussbaum — said those mandates will stay in place for any new owner.

“Regardless of the owner of the site, all agreements made with the community and organized labor will be honored,” the spokesperson said.

Slate and Meadow teamed up in 2015 and bought the sites at 1 Flatbush and 570 Fulton for $40.9 million. The decision to sell is being driven by Meadow Partners’ timeline for its private equity funds, sources said.

A JLL team led by Stephen Palmese is marketing the site, which has about 210,000 square feet of development rights. Sources said the owners are taking bids and there is no asking price.

As for 1 Flatbush, a Cushman & Wakefield team of Adam Spies, Doug Harmon, Adam Doneger and Dan O’Brien is marketing the property, which a source familiar with the building said has an asking price of $150 million.

The property, which includes more than 25,000 square feet of retail that wraps around Fulton Street and Flatbush Avenue, has a 25-year 421a tax abatement that runs through 2044.

The owners, however, are in the process of converting the abatement into the Affordable New York program, the successor to 421a. That will lower the property’s taxes even further for 35 years through 2054. Of the building’s 183 units, 48 are affordable and 134 are market-rate.

A source familiar with the property said Slate could end up buying Meadow’s share.

The joint venture partners are certainly hoping the market has improved since a year ago, when a pair of Downtown Brooklyn apartment buildings were made available but drew little interest.

Late last year CBZ Management put its 110-uni BRiQ apartment building at 237 Duffield Street up for sale with an asking price of $100 million. And around the same time Pink Stone Capital sought to unload its 103-unit “Brooklyn Warehouse 180” building at 180 Nassau Street for north of $60 million.

Both buildings failed to attract buyers. And as state lawmakers worked to overhaul rent regulations laws this year, the entire multifamily market ground to a virtual halt.

Sources said the tighter rent law that Albany passed in June is driving more investors to market-rate properties, pushing up interest and pricing.

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