Davis offloads Fulton Street site to Yitzchok Katz

421a deadline looms for proposed 45-story, mixed-use highrise

Davis Companies' Jonathan Davis, Slate's Martin Nussbaum and 570 Fulton Street
Davis Companies' Jonathan Davis, Slate's Martin Nussbaum and 570 Fulton Street (David Companies, Slate, Google Maps)

Davis Companies is passing the baton — and the buck — on a proposed 45-story, 139-unit rental project in Brooklyn.

Its $24 million sale of 570 Fulton Street to Yitzchok Katz makes Davis the second developer to bail on the project in recent years, according to city records.

The development is beholden to a series of promises made to the City Council for a 2019 rezoning by its previous owners, Slate Property Group and Meadow Partners, who scooped up the wedge-shaped property for $22.9 million in 2015.

To appease the local community board, Slate and Davis agreed to use union labor. They also signed off on renovating the entrances to the nearby Nevins Street subway station by modifying the steps and replacing handrails, according to the City Planning Commission.

The project was also expected to create 35 to 42 affordable housing units — a promise that Slate said would stick with the development even if Slate didn’t.

Sign Up for the undefined Newsletter

“Regardless of the owner of the site, all agreements made with the community and organized labor will be honored,” a Slate spokesperson said to The Real Deal in 2019. The affordability is a matter of law, as the rezoning triggered the city’s Mandatory Inclusionary Housing mandate.

Neither Slate nor Davis responded to requests for comment.

Katz, who also owns a 186,000-square-foot property just around the corner at 370 Livingston Street, where he plans a 105-unit building, got a $36 million mortgage for the Fulton Street site from Slate.

Under Davis’ helm, a four-story mixed-use building that previously occupied the site was razed to make way for the 200,000-square-foot tower, which would include 87,000 square feet of office space.

It’s unclear if Davis always intended to sell the lot after flattening the low-rise. Demolition was completed in April, qualifying the project for a 421a tax abatement, but the looming 2026 completion deadline puts pressure on Katz to build quickly to reap the hefty tax break, which is probably essential to get a construction loan.

Real estate interests are petitioning the state legislature to extend the deadline.

Read more