Brooklyn, NY – A collection of Borough Park apartment buildings is on the market for $50 million.
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The Real Deal (http://bit.ly/18ZjeOg) reports that the four buildings, marketed by Gabe Saffioti and Nicole Rabinowitsch of Eastern Consolidated, have 193 rent-regulated units. They buildings are located at 4520 12th Avenue, 4711 12th Avenue, 1314 46th Street and 1217 47th Street.
A family investor has owned the portfolio for more than 30 years, and did not want to be identified.
The properties in the mostly Orthodox Jewish neighborhood are all rent-stabilized with the exclusion of five rent-controlled units. Three commercial spaces housing a doctor, a dentist and a real estate company are also located in the buildings.
Saffioti noted that the area does not trade often. Rabinowitsch estimates that rent rolls could increase by about one-third in the next two years due to high turnover in the area.
Rabinowitsch also stated the family is firm on their bid of the high $40 million to low $50 million dollar range.
I’m not a real estate guru but about 200 apartments at an average rent of $1500 per month per unit multiplied by twelve months would earn approximately 3.6 million annually.
Fifity million is the equivalent of about 14 times annual rent roll when the average worth of rental buildings are about 7 to 10 times annual rent roll.
At the high end of about 10 times rent roll these buildings should be marketed in the 36 million dollar area! But then again I’m no real estate guru!
Im thinking
Don’t forget about the value of the bricks, and used boilers.
commercial space
how much will it cost to build 193 units in that area at today’s cost, that should be part of the factoring in the selling price.
The calculations are pretty straightforward. They base it on expected changes in rent, especially if they can decontrol it to market rate.
if they have section 8 apartments at least they are guaranteed that rent
the buyer will pay around 250,000 per unit, will apply for condo conversion, and can start selling at 400,000 + each unit
this is sad big time, i loved my managers until now 🙂 they were doing a wonderful job.
We’ve been looking for a one bedroom is the area. They are going for 1300 and up.
dont forget the maintenance costs and all the tenants that dont pay on time or ever
I would estimate it at 17-18 times the rent roll. As for the estimate that it will increase by 1/3 over 2 years is so ridiculous, it borders on fraud.