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Wednesday January 04, 2012
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Buyer of Jehovah's Witness Brooklyn Buildings Revealed
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 Sugar Hill Capital Partners has purchased 50 Orange Street in Brooklyn Heights for $7.1 million from the Jehovah’s Witness-operated Watchtower Bible and Tract Society of New York, brokers revealed yesterday.
Sugar Hill, according to its website, is a real estate investment firm that focuses on Brooklyn and Manhattan assets with repositioning potential. A spokeswoman for the firm, Aliza Weinstein, confirmed the company had purchased the building but declined to comment any further.
Fifty Orange Street is a five story, 15,355-square-foot, multi-family building with 20 residential units, an equal mix of ten studios and ten one bedroom apartments. The building had been used to house members of the Jehovah’s Witness organization, which owns about three-million-square-feet of residential and commercial office space in Brooklyn and operates its world headquarters in the area. According to recent reports, the organization is considering liquidating its substantial real estate holdings in the city and relocating to Upstate New York.
Bob Knakal, chairman of the real estate brokerage company Massey Knakal, handled the sale and said that the property was especially desirable because it was offered by the seller fully vacant. Usually properties of this type and in prime locations have rent stabilized tenants, he said, which can impact value because these types of tenants pay lower-than-market rental rates.
The Jehovah’s Witnesses also take excellent care of their real estate holdings, Mr. Knakal noted—and 50 Orange Street was in pristine condition. According to a release issued by Massey Knakal, the property was renovated by the religious group in 2006.
“We didn’t set a specific price [marketing the property],” Mr. Knakal said. “We received a ton of interest. About a hundred buyers took a look at this building, which is a lot. It was clearly very highly sought after because of the location, it was vacant and the Jehovah’s Witnesses keep their properties in immaculate condition.”
Mr. Knakal is in the process of marketing two other Jehovah’s Witness properties in the Brooklyn Heights neighborhood: 183 and 161 Columbia Heights. The former is a seven-story, 13-unit, vacant apartment building that boasts approximately 15,000 square feet. 161 Columbia Heights, meanwhile, is smaller—about 7,500 square feet—and has seven fair-market apartments, one that is rent stabalized and two that are rent controlled. Mr. Knakal said the two properties are nearing a sale and estimated that they would trade for roughly $7.1 million and $3.5 million respectively.
Busy through the downturn in the real estate market, Mr. Knakal predicts that sales will pick up in 2012.
“Financing is plentiful and at low rates and the liklihood that capital gains rates will rise after next year will drive sellers to put properties on the market,” Mr. Knakal said. “I think that 2012 will be a fantastic year.”
In addition to the Brooklyn buildings he is handling for the Jehovah’s Witnesses, Mr. Knakal is currently in the process of marketing a larger deal in the Bronx. 385 Gerard Avenue, a 410,000-square-foot warehouse, is on the market and could trade for as much as $45 million, Mr. Knakal said. According to Mr. Knakal, the property offers potential buyers an opportunity to convert the space to another use, such as residential, or maintain the asset as an industrial property.
Daniel Geiger, Staff Writer, is reachable at DGeiger@Observer.com and can also be followed at Twitter.com/DanGeiger79.
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Home Goods Maker, Dinnerware Retailer, Move to Park
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 French luxury home goods maker Daum Inc. and its sister dinnerware company Haviland will officially move out of its longtime Madison Avenue storefront to 4,500 square feet of office and retail space at 499 Park Avenue, where the business had been recently operating a temporary store for the holiday season.
With its new lease, Daum and Haviland will be taking 1,500 square feet on a ground floor space and 3,000 square feet on the concourse, brokers close to the deal said. The lease is for ten years, with asking rents at $250 per square foot for the ground floor and $45 per square foot for the concourse.
Daum Inc. was rapidly growing out of its old space at 694 Madison Avenue, where it had been for 20 years, and needed to move to a new location where it would be “in the middle of the action on Park Avenue, where you have this critical mass of flatware, porcelain, antiques and home furnishings,” said Jonathan Krevine, a Director at Newmark Knight Frank who represented Daum in the deal.
“They were really in kind of a zone where it was largely jewelry,” added Mr. Krevine about the company’s Madison Avenue store.
Daum had six years remaining on its Madison Avenue lease.
Hines, 499 Park Avenue’s landlord, was represented by Gene Spiegelman, Alisa Amsterdam, and Michael O’Neill, all of Cushman & Wakefield.
The 499 Park Avenue building had a ground floor space that was once the home of disgraced lawyer Marc Dreier and his now-defunct law firm Dreier LLP, said Mr. Spiegelman. The ground floor was also the former site of Bloomberg LP’s headquarters before it moved into its own tower at 731 Lexington Avenue.
“It hadn’t been in the retail inventory in quite a while,” added Mr. Spiegelman.
French luxury porcelain maker Bernardaud formerly occupied the entire ground floor space to the north of the lobby but shrunk its storefront to half the size, Mr. Spiegelman said.
Daum and Haviland, both century-old French luxury goods makers who have been operating in the US market for the past thirty years, held a soft opening at the new 499 Park Avenue storefront for the 2011 holiday season. Both are now renovating the space—which will also house offices for Daum and Haviland—and are slated to open this spring, said Mr. Krevine.
Once complete, Daum and Haviland will officially be neighbors to fellow luxury collectables vendors like Scully and Scully and James Robinson, just as Mr. Krevine had wanted.
Daniel Edward Rosen, Staff Writer, is reachable at DRosen@Observer.com and can be followed at Twiter.com/Dedwardro
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