Towering expectations for Williamsburgh Bank building

By Lauren Elkies | October 30, 2007 01:24PM

Buyers of apartments in the Williamsburgh Savings Bank building are as focused on securing a piece of Brooklyn history as they are on scoring a luxury property, one of few that offers sky-high views of Manhattan from the other side of the East River.

A steady stream of people has funneled in and out of the sales offices of the 512-foot landmark that remains the borough’s tallest building. Sited at One Hanson Place at the corner of Flatbush Avenue, the Fort Greene architectural treasure is going condo, with commercial space on the lower floors.

“Everybody walks in and they like it,” said the Corcoran Group’s Adam Pacelli, the sales director for the project. Pacelli estimates that he has seen 800 people pass through the sales office between the end of June and mid-September. Not everybody that walks in actually intends to buy. “Because of its iconic interest, people want to come in for the tour,” Pacelli said.

The converted tower will have 189 units ranging from 500-square-foot studios starting at $350,000 up to 2,300-square-foot three-bedrooms with terraces for $3 million, and should open next autumn. More than 25 percent of its units were in contract as of late last month, Pacelli said. About 65 percent of the buyers hail from Manhattan, Pacelli said. The rest already live in Brooklyn. Occupancy will begin in the fall of 2007.

Specific lines and apartments have seen price increases of between 2 and 5 percent, he said. For example, a studio on one of the higher floors had an asking price of $410,000, but sold for $425,000. Based on current sales and value, he estimates about a $200 million net sell-out.

Serving as a focal point since its erection in 1929, the Williamsburgh Savings Bank (which, unlike the neighborhood to the north, has an “h”) boasts a golden dome and one of the world’s largest four-sided clock towers. It’s near the Brooklyn Academy of Music, the Atlantic Terminal shopping center, the Atlantic Avenue-Pacific Street transit hub station as well as a Long Island Rail Road station at the Atlantic Terminal.

“We opened in the beginning of June,” said Andrew MacArthur, a principal at the Dermot Company, a co-developer of the building. “We went into the summer season, which is traditionally slow, and managed to sell 25 percent of the building in the first couple of months.” He added, “We’re achieving our underwriting.”

Despite the hype, the Williamsburgh Bank conversion has not piqued everyone’s interest.

Elan Padeh, CEO and president of marketing firm the Developers Group, said he has heard brokers talking about the building, but “none of our buyers have asked about the building.”

Padeh, who is involved in selling a number of projects in the area, wondered about the efficiency of the conversion project in terms of the width and the depth of the available residential space.

Regardless of client interest, Padeh said the building is beautiful and noted that he had once tried to facilitate the purchase of the property for a developer.

“I was looking to turn it into residential in 2001,” he said. “They had a lot of dentists there and they didn’t think they’d be able to get them out until 2008.” The building acquired various nicknames due to its density of dentists back in the day; less than 20 remain in offices in the building.

Up until about a year ago, the Williamsburgh Bank building was owned by HSBC. The Dermot Company partnered with the Canyon-Johnson Urban Funds, headed by NBA legend Earvin “Magic” Johnson, to buy the property for $70.75 million, MacArthur from Dermot said.

This was the Dermot Company’s first condo deal and a big departure from its rental-oriented business. “If we were going to do a condo deal, we wanted to buy a distinctive property and this was about as distinctive as it gets,” MacArthur said. “We initially tried to figure out if we could do it as a rental.” The numbers didn’t pencil out.

The president of Brooklyn brokerage firm Aptsandlofts.com, David Maundrell, speculates that sales will be solid at the bank building. Its location at the junction of several neighborhoods, its height, the views and the fact that the building is a landmark — the exterior and part of the interior — will drive sales, he said.

A drawback is the location of the building, Maundrell said. It’s surrounded by excessive noise and pollution in that downtown area.

Borders laid claim to a 35,000-square-foot space that includes the first-floor, landmarked banking hall, replete with bank teller stations; the basement space, home to the bank vault with its two 48-ton doors and 16-ton jambs; and mezzanine, where Borders will build a cafeacute;. The cathedral-like banking hall has a 70-foot ceiling, the equivalent of a traditional seven stories. The book company is expected to move into the space within 12 months.

On the eighth floor, the first floor above Borders, 30,000 square feet of office space can accommodate the 16 or 17 medical professionals remaining in the building, Mac-Arthur said. From floors nine to 37, the developers are retrofitting condos.

Because the first residential floor starts 90 to 95 feet in the air, every apartment can have a view of New York Harbor, the Statue of Liberty, Manhattan and/or Brooklyn proper, brokers said. Some units have large terraces.

The Williamsburgh Savings Bank building might not remain the sole skyscraper in Brooklyn. Rezoning in downtown Brooklyn has prompted other developers to plan towers in the area, which would likely affect some of the bank building’s views.

“If you want to have a thriving community in downtown Brooklyn,” Padeh said, “you have to allow for more tall buildings.” Also, he said, some of the new skyscrapers could contribute to the skyline.

Corcoran’s Pacelli doubts the buildings slated for development would come near the height of the Williamsburgh Bank building. Even if they did, he said, the buildings would be too far away from the bank building to obstruct the views.