NYC Real Estate News

Over a decade after the longstanding Pathmark store closed, residents of Two Bridges this week celebrated the opening of a new grocery store in the neighborhood. Brooklyn Fare Kitchen & Market has opened at the base of luxury condominium One Manhattan Square at 227 Cherry Street. The new store measures 25,500 square feet, features an [...]

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Pity the auction house specialists. As they scrambled to assemble work for the all-important spring auctions in New York that run during the week of May 13, an ongoing market slump has kept many potential consignors on the sidelines.

“Sellers, for this period of time, seem a bit cautious and nervous that there are strong headwinds,” says Brooke Lampley, Sotheby’s global chairman and head of global fine art. “They’re thinking that if they can choose to wait, perhaps they should.”

That’s not good news for Sotheby’s, Christie’s and Phillips. This is the first May auction season in recent memory that’s largely devoid of significant estate sales—the kind of collections upon which these bellwether auction weeks are usually built.

“It was really dire in terms of collections this season,” says Alex Rotter, chairman of Christie’s 20th and 21st century art department, of available estates. “By scoring the collections of Norman Lear and Rosa de la Cruz, we basically got the only two.”

For context, the objects from the Lear collection are expected to sell for more than $50 million and those from de la Cruz’ between $25 million and $37 million; in May 2023, the late record executive Mo Ostin’s collection sold for more than $123 million at Sotheby’s. 

Adding to the supply crunch is the fact that rich people are mostly faring well enough, meaning they can afford to wait it out. “The art collecting community is a high-level community, which is not impacted by daily inflation or something like that,” Rotter says. “If our collectors were only commercial real estate guys, that would be a different thing.”

As a result, auction house specialists say they’ve had to pound the pavement to drum up material to sell. “We haven’t been this proactive about business in quite a while,” Rotter says.

Similarly, says Lampley, “I think it’s kind of refreshing to see sales that have been curated and designed the more traditional way, which is brick by brick.” From a sales perspective, she continues, “it was great this season to really pursue material that we thought was just right for the market.” 

This May auction season, in other words, might prove to be one of the truest barometers of the art market in recent memory, one that reflects not only what people are willing to buy but also what they think they can sell. 

Lampley says she was able to persuade consignors to part with their work by arguing, effectively, that they’d be big fish in a smaller pond. “I had a lot of conversations with sellers or owners of works this season, saying: You know what? Counterintuitively, it’s a good time to sell because a lot of other people aren’t selling,” she says. “Less internal competition is favorable to the sellers.”

The end result of all this hustling? Volumes are similar to years past—but overall values are dramatically lower.

In May last year, Christie’s sold about $922 million worth of art (a total that includes auction house fees known as premiums, which can range from roughly 14% to about 26%). This year it anticipates totals ranging from $578 million to $846 million before fees are calculated. Last May, Sotheby’s sold more than $716 million of work, with fees, and this year it aims to sell from $549 million to $784 million before fees are added.

Only much-smaller Phillips expects a year-over-year increase: Its New York auctions should bring in from $113 million to $163.5 million before fees; last year’s May sales totaled about $108 million, including fees.

“The market is not where it was last year,” says Rotter. “It is smaller, and it is very selective.” 

In this context, you might expect the quality of the material to plummet. Over the past week, though, as the New York art world assembled at cocktail parties and art fairs, the general consensus seemed to be that the auction houses have managed to cobble together a surprisingly strong showing.

“I think they’ve managed it pretty well,” says Alex Glauber, president of the Association of Professional Art Advisors and founder of the firm AWG Art Advisory. “Not surprisingly, volume and value are down, so they’ve put together conservative and safe sales. You don’t see auction debuts or trendy names coming in.”

Rotter says that given the multiple conflicts around the globe, he deliberately tried to put together a comparatively cheery sale. “The sale has a more—a happy character. That sounds so lame, but it’s definitely more joyful,” he continues. “I didn’t go for the intense pieces. I tried to avoid that.” He cites a large 1964 Flowers by Andy Warhol (estimate: $20 million to $30 million) rather than, say, a piece from the artist’s Death and Disaster series.

Bidders can also expect to see familiar names at (occasionally) unfamiliar low prices.

An abstract painting by Gerhard Richter from 1988, for instance, carries an estimate of $10 million to $15 million; a similar work from the same series, Rotter says, sold two years ago for $22 million. “You can get things you couldn’t get before, at what we consider fair prices,” he says. In another instance, a bright portrait of a young man by Elizabeth Peyton, from 1997, is estimated from $1 million to $1.5 million. “Looking at prices, in the last few years this used to be $2 million to $3 million,” he says.

It’s not all billionaire-level bargains. Each sale is dotted with standouts. In the contemporary evening auction on May 13, Sotheby’s will offer a painting by Francis Bacon, Portrait of George Dyer Crouching, from 1966; it carries an estimate of $30 million to $50 million. In its modern evening auction on May 15, a work from Claude Monet’s haystacks series, Meules à Giverny, from 1893 is unofficially estimated to exceed $30 million.

At Christie’s, a 2004-07 abstract painting by Brice Marden carries a $30 million to $50 million estimate in its 21st century evening sale on May 14. In its 20th century evening sale on May 16, a painting by David Hockney from Lear’s collection, A Lawn Being Sprinkled, from 1967, is estimated from $25 million to $35 million.

Not to be outdone, Phillips plans to lead the week on May 14 with a 1982 Basquiat painting, Untitled (ELMAR). It carries an estimate of $40 million to $60 million.

From top to bottom, the success of the sales will offer, Glauber says, a critical insight into the overall strength of the art market. “Much as we tried to talk about the art market as a monolithic entity, it is not,” he says. “Each of our perspectives can be a bit myopic. So this provides, really, a snapshot—more broadly—of where we’re at.”

Guggenheim Partners is talking to lenders, including private credit firms, to gauge their interest in financing the potential $6.6 billion buyout of U.S. department store chain Macy’s Inc. by investment firms Arkhouse Management Co. and Brigade Capital Management.

The funding could include at least $1.4 billion of debt, spread over multiple transactions tied to different types of collateral, according to people with knowledge of the matter. Guggenheim is seeking a $650 million loan at the operating company level, said the people, asking not to be identified as the details are private. That financing would be a type of debt known as “first in, last out,” and would be in addition to a large asset-based loan from a bank.

Meanwhile, Guggenheim is sounding out investors for debt backed by the department store-operator’s real estate, which could total more than $700 million to be financed through the commercial mortgage-backed securities market, according to the people. Another slice of debt tied to the company’s properties could be added on top of that, said the people. 

The conversations are preliminary and financing details may change, the people said. Additional funding may be necessary, with specifics for that borrowing determined later, they noted.

Representatives for Macy’s, Guggenheim, Arkhouse and Brigade declined to comment.

The lender outreach comes after Macy’s initially rebuffed a bid of $21 a share from Arkhouse and Brigade in January, saying it lacked “compelling value.” The firms returned in March with an improved offer of $24 a share. Macy’s recently opened its books to the buyout firms and named two new directors nominated by Arkhouse, which agreed to end its effort to seek majority board representation.

New York-based Macy’s, which also owns Bloomingdale’s and Bluemercury, has struggled to compete as long-term shopper preferences shift toward online retailers and away from department stores. Its possible buyout by Arkhouse and Brigade has an estimated enterprise value of more than $11.5 billion, including debt, according to data compiled by Bloomberg. 

Not all big-ticket properties live up to their astronomical price tags, but the most expensive listing in Park Slope–a custom-engineered five-story townhouse at 535 1st Street on a prime landmarked block–is the very definition of no-expense-spared reconstruction. The five-bedroom residence, asking $18,000,000, was commissioned by the award-winning architecture and design firm Leroy Street Studio. Recently [...]

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Brooklyn State senator Zellnor Myrie is taking steps to challenge Mayor Eric Adams for re-election in 2025, further complicating Adams’ already uncertain hopes for a second term amid sagging approval ratings.

Myrie, a 37-year-old progressive, confirmed in a statement on Wednesday that he is moving to run against Adams. He joins former comptroller Scott Stringer in eyeing a Democratic primary challenge to the incumbent mayor.

“For too many New Yorkers that I speak to, they’re tired of the showmanship,” Myrie said. “What people want to see are results. New Yorkers want to see their government working relentlessly to make this city affordable, safe, and livable — and that’s why I’m taking the first steps to explore a race for Mayor in 2025.”

Myrie, who is Afro-Latino and an attorney by training, represents the state Senate district that Adams himself once held, covering Central Brooklyn neighborhoods like Crown Heights, Prospect Heights and Park Slope. Myrie won his seat in 2018 as part of a progressive wave that ended Republican control of the state Senate, and has since championed causes including criminal justice reform, including the “clean slate” law that will seal more criminal convictions.

“My parents came here from Costa Rica nearly 50 years ago because this city held promise and opportunity, but I’ve watched that opportunity disappear for too many New Yorkers like me,” Myrie added in his statement. “We need to build a city where families can find good housing in a safe neighborhood, schools to care for and educate our kids, and leadership that is laser-focused on solving our city’s challenges.”

Myrie told the New York Times that his campaign would focus on “competence,” and criticized Adams’ cuts to schools, parks and libraries. But he is sure to face his own hurdles: Myrie is not well-known among voters citywide, and lacks Adams’ head-start on fundraising and his connections to powerful labor unions. Mayor Adams has $2.2 million on hand in his re-election campaign account.

But the mayor’s vulnerabilities are obvious: Adams’ approval rating fell to just 28% in a December Quinnipiac University poll, the survey’s worst-ever result for a New York City mayor. Myrie also has the potential to undercut Adams’ historically strong bases of support in Central Brooklyn, and in the Black and Latino communities.

Myrie’s interest in challenging Adams has been known for months, and was a topic of discussion at last year’s Somos conference that drew New York’s political power brokers to Puerto Rico. Others seen as potential challengers include Queens State Sen. Jessica Ramos and former Gov. Andrew Cuomo.

Evan Thies, a longtime Adams representative who said he does not yet work for the mayor’s re-election campaign, sent Crain’s a supportive quote from Brooklyn Assemblywoman Rodneyse Bichotte Hermelyn in response to Myrie’s entry on Wednesday.

"Mayor Adams has brought down crime on our streets and raised test scores in our schools while creating more jobs than New York has ever had, raising wages for hundreds of thousands of New Yorkers and lowering the Black unemployment rate — all while handling multiple crises, from COVID to migrants,” said Bichotte Hermelyn, who also chairs the Brooklyn Democratic Party. “And that is why New Yorkers — especially working class New Yorkers — will be behind him for mayor."

Red Hook, a shipping hub on New York Bay, has seen big dreams dashed like waves upon rocks. Many promised redevelopments of industrial sites have never come to pass despite obvious potential and considerable hype.

A new developer hopes to break the streak. Eschewing the mixed-use approach that has characterized previous proposals, the team of Bungalow Projects and Bain Capital Real Estate is planning to create a single-purpose project for the historically commercial neighborhood: a 225,000-square-foot, 4-soundstage film studio on a site that once repaired cars.

“It will be a total game-changer,” said Newmark broker David Behin, a 20-year Brooklyn real estate veteran who found the site, at 145 Wolcott St., for the developers. “Red Hook is turning into a nice place to live and play and work.”

Offering a blank slate-esque one-and-a-half acres of vacant land across a nearly full-block site, Wolcott has appeal on a practical level. But it’s also located in a place that could translate into savings for filmmakers. Indeed, if a show is shot within eight miles of Columbus Circle (considered the city’s geographic center), producers can save on transportation and overtime costs for actors and crews.

Not served by any subway lines, out-of-the-way Red Hook has sometimes suffered for being hard to get to, though city ferries have serviced the neighborhood since 2017. Still, Hollywood workers are prone to get around the city by car. Bungalow and Bain, which will employ just 10 full-time workers at the Wolcott site, may be betting that the hundreds of others hired for productions will be unfazed by a little extra driving.

To be sure, the site has seen grand plans before. Previous owner W-G Capital Advisors, which bought the parcel in 2019 for $21.5 million, envisioned a multipronged project with offices, restaurants and apartments, including affordable housing. But W-G’s vision collided with local opposition over the developer’s approach to rezoning the property, which supposedly limited community input. The idea of building homes on streets that have been known to flood was also a point of contention.

But by offering an industrial-only use at Wolcott, Bungalow and Bain may be able to swim where the previous landlord sank.

In any event, the developers appear to be moving on multiple fronts. In December they closed on a similarly industrial site on Moore Street in Bushwick for $26.7 million, a location where they are planning another movie studio, this one measuring 330,000 square feet with six soundstages.

145 Wolcott St.

Auto-repair shop Perfect Bodies occupied this nearly full-block site for years. Yards filled with cars surrounded a gray corrugated-metal garage. But in 2019, owner Gregory Iovine sold the property to Washington, D.C.-based W-G Capital Advisors, an investment firm headed by John Gerber, for $21.5 million. Soon after, Gerber and partners, including former Department of City Planning official Alexandros Washburn, unveiled the kind of ambitious mixed-use redevelopment that Red Hook’s half-empty blocks have often attracted in recent years, though usually with limited success. W-G’s offering was a 300,000-square-foot development featuring a 14-story tower, 210 apartments, office space, restaurants and shops, as well as light-manufacturing facilities. But opponents led by Council Member Carlos Menchaca criticized W-G for seeking a rezoning by variance and not through the more transparent land use review process. And despite demolishing the site’s garage in 2023, W-G ultimately unloaded No. 145 in April to Bungalow Projects and Bain Capital Real Estate for $35.1 million, records show. The team is planning a 225,000-square-foot film studio with four 18,000-square-foot soundstages. A project spokesman declined to share the development cost but said that construction will begin in the first quarter of 2025 and end in early 2027.

202 Conover St.

Change turns heads in this aged and sleepy area. Arresting architecture may help too, like with this site’s new 4,200-square-foot nonprofit arts space, whose façade features a four-story glass wall ribbed with wooden fins. Along another wall are seven white angular sections that invoke sails, a seeming tribute to the time a few centuries ago when tall-masted schooners tied up nearby. Dr. Michel Cohen, the founder of the popular child-focused Tribeca Pediatrics chain, developed No. 202 after purchasing its formerly weedy 25-by-100-foot lot in 2017 for about $1 million, according to the city register. Known for his design-minded offices, Cohen’s choice for an architect for No. 202 was Thomas Barry, who also styled Tribeca Pediatrics’ Bushwick and East New York offices. The building is eventually supposed to host concerts, films and parties, though permits indicate its interior is still incomplete.

199 Conover St.

Up until a few years ago, residential condos were a rare sight in Red Hook. An early stab at a 70-unit conversion at 160 Imlay St., a concrete warehouse once used by mail-order powerhouse Montgomery Ward, was stalled for years before recently resuming sales. But perhaps as home-buyers become less concerned with proximity to their offices, a handful of projects have entered the market, including the Conover, a 3-story, 22-unit offering at this address. With one- to three-bedroom units, the project, from developer RedHoek+, won approval for its offering plan in 2022, and had sold and closed 15 of its units between spring 2022 and May 2, according to the city register. A spokeswoman for the project said a handful of other units are in contract as well. Among them is No. PH3A, a three-bedroom that went for $2.6 million, or about $1,600 per square foot, which appears to be a local sales record. A $38 million total haul is expected, as per the offering plan. Shell company Red Hook Building Co. assembled the nine lots that make up the site, which had a mix of boarded-up buildings and windswept lots, and sold them to RedHoek+, whose principal is Lee Cohen, for $8.1 million in 2019, records show. A.G. Ship Maintenance Corp., a cargo-handling firm, was a long-ago owner of the property.

160 Dikeman St.

The 4-story, 11,000-square-foot office building on this site, which opened in 2020, appears to have been built on spec, which might have seemed like a decent bet in pre-Covid times but is perhaps harder to fathom in the current remote-work era. The building, which has 13-foot ceilings with exposed ductwork for an industrial look, is completely empty, according to the commercial real estate database CoStar and the building’s own website. In fact, interested tenants can lease the entire structure, whose roof deck has Manhattan views. In 2023 Douglas Elliman was marketing floors for $35 per square foot annually, which is cheap relative to Manhattan, where $75 is the norm. In 2016 developer Ulgar Aydin of KSK Construction Corp. purchased No. 160, which formerly had a small parking lot, for $1.8 million, according to the city register. The FBI is currently investigating whether KSK illegally funneled Turkish contributions into Mayor Eric Adams’ 2021 campaign. No. 160’s seller was local landlord Red Hook Building Co., an investing arm of New Jersey-based firm Guido Enterprises. The neighborhood’s largest private owner of real estate, though, is the O’Connell Organization, a business founded in 1967 by former narcotics detective Gregory O’Connell.

117 Ferris St.

This nondescript complex has a colorful occupant, Dell’s Maraschino Cherries, which churns out multiple millions of pounds of its neon-red, Shirley Temple-garnishing signature product a year. Founded in 1948 in a Carroll Gardens storefront by Italian immigrant Ralph Mondella, Dell’s relocated to Red Hook in the 1970s after it outgrew its space and became a quirky local presence. Local bees reportedly have a scarlet hue as does their honey. Ralph’s grandson Arthur Mondella, who took over the company after a stint on Wall Street, had a secret side hustle in recent years: an illegal marijuana farm hidden in No. 117’s basement. When authorities raided the space in 2015, they found 100 plants and 100 pounds of pot, according to news reports. After police arrived, Mondella locked himself in a bathroom and fatally shot himself. Mondella’s daughters Dana Bentz and Dominique Mondella run Dell’s today. In 1994, the company bought No. 117 for $265,000, which would be about $500,000 today after adjusting for inflation. The city puts the low-slung property’s market value at $2.1 million, which means it could trade for about $4 million.

43 Ferris St.

Former factory sites in the city often have quite different uses these days, although some holdouts remain, like this well-kept three-story brick structure with paned windows on a block-long site. It appears to have had a nearly continuous line of manufacturing tenants since its 1899 opening. Designed by William Tubby, an architect put to frequent use by Brooklyn’s well-known Pratt family, the multi-building complex was first home to Witteman Brothers, which made bottles, corks, caps and labels for the beer and soda industry. Le Comte & Co., which made tin cans, moved in afterwards, and the company’s sign still endures in faded letters on No. 43’s façade. Segal Lock, which made the vertically-aligned deadbolts that are still ubiquitous in New York apartments, came next, according to a history of the property. Likewise, the site’s owner for the past couple decades has been E.R. Butler Co., which produces period door knobs, chandeliers and candlesticks. Butler, which has showrooms in SoHo, Boston and Italy, purchased the five-building complex in 1998 for $1.5 million, records show, and paid off its $2.8 million note on the property, held by JPMorgan Chase & Co., last year. The restored building has joined “the creative foment that characterizes this diverse section of Brooklyn,” Butler’s site says.

44 Ferris St.

A decade ago, California developer Estate Four had planned to turn this large parcel and five other adjacent sites into a 12-acre, 1.2 million-square-foot mixed-use office and retail complex called the Red Hook Innovation District. But for unknown reasons, Estate Four bailed a few years later before selling the entire site to UPS in 2018 for a hefty $303 million; the package delivery service vowed to build a six-story distribution center there. UPS did later raze the Lidgerwood Building, a prewar structure at Ferris and Coffey streets that once churned out heavy machinery, including log skidders, coffee hullers and digging equipment for the Panama Canal, according to the blog Brownstoner. Also demolished was a brick structure at the end of Wolcott Street that housed a New York Daily News printing plant in the 1950s and later a Snapple warehouse. But no new buildings have risen on the desolate tracts yet.