Watermark pays $15M for church dev site in Fort Greene

Watermark Capital Group through the entity 144 Bam LLC paid $15 million to Hanson Place Central Methodist Episcopal Church for the specialty building (M9) at 144 St. Felix Street in Fort Greene, Brooklyn.
The deal closed on June 27, 2024 and was recorded on July 5, 2024. The property has 65,500 square feet of built space and 99,004 square feet of additional air rights for a total buildable of 164,460 square feet according to a PincusCo analysis of city data. The sale price per built square foot is $229 and the price per buildable square foot is $91 per the PincusCo analysis. (The price per square foot analysis is the transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)
The signatory for Hanson Place Central Methodist Episcopal Church was Willie Dixon and Isice Adams. The signatory for Watermark Capital Group was Wolfe Landau. The contract date was February 28, 2024. PincusCo reported on the transaction shortly after it went into contract.

According to the offering material from broker Geoffrey Newman of Savills, the block was “recently rezoned to a C6-4 which allows for a 10 FAR for residential, commercial and community facility. Through this far the max floor area can now reach 164,460 ZSF.”

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Watermark Capital Group purchased seven properties in seven transactions for a total of $105.9 million and sold one property in one transactions for a total of $4 million over the past 24 months.
The seller Hanson Place Central Methodist Episcopal Church had not purchased any other properties and had not sold any properties over the same time period.

The property

The specialty building in Fort Greene has 65,500 square feet of built space and 99,004 square feet of additional air rights for a total buildable of 164,460 square feet according to a PincusCo analysis of city data. The parcel has frontage of 165 feet and is 100 feet deep with a total lot size of 16,446 square feet. The lot is irregular. The zoning is C6-4 which allows for up to 10 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The property is in the Brooklyn Academy of Music Historic District. The city-designated market value for the property in 2022 is $9.2 million.

Violations and lawsuits

The property was involved in one court case over the past two years. The court filing was a $15 million judgment concerning a leave to sell filed on March 4, 2024, by Hanson Place Central United Methodist Church with Watermark Capital Group and Wolfe Landau as the buyer. In addition, according to city public data, the property has received seven DOB violations, $3,650 in ECB penalties, and $4,250 in OATH penalties in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Fort Greene, The bulk, or 35 percent of the 12.8 million square feet of commercial built space are elevator buildings, with specialty buildings next occupying 22 percent of the space. In sales, Fort Greene has 2.3 times the average sales volume among other neighborhoods with $617.8 million in sales volume in the last two years and is the 8th highest in Brooklyn. For development, Fort Greene has 1.6 times the average amount of major developments relative to other neighborhoods and is the 7th highest in Brooklyn. It had 1.8 million square feet of commercial and multi-family construction under development in the last two years, which represents 14 percent of the neighborhood’s built space.

The block

There are no active new building construction projects on this tax block.

The majority, or 100 percent of the 189,635 square feet of built space are specialty buildings, with industrial buildings next occupying 0 percent of the space.

The buyer

The PincusCo database currently indicates that Watermark Capital Group owned at least 124 commercial properties with 1,448 residential units in New York City with 1,426,235 square feet and a city-determined market value of $277.8 million. (Market value is typically about 50% of actual value.) The portfolio has $141 million in debt, with top three lenders as BridgeCity Capital, Signature Bank, and Bridge City Funding respectively. Within the portfolio, the bulk, or 58 percent of the 1,426,235 square feet of built space are walkup properties, with elevator properties next occupying 21 percent of the space. The bulk, or 93 percent of the built space, is in Brooklyn, with Queens next at 7 percent of the space.

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