The state bailed out a long-delayed, 42-story residential tower just off Flatbush Avenue late last month, days before a tax exemption deadline would have left developers with an unfunded mega-project for at least another year.
The cash infusion allowed the Dermot Company to begin building its 347-unit tower — located on a previously empty lot at Rockwell Place and Fulton Street in Fort Greene.
The project was all but abandoned when the “financial crisis” hit in 2008, until developers made a last-minute deal — called a 421-a subsidy — with the state that would set aside 65 units at below-market rents in exchange for $90 million in subsidies.
That deal would have been void if developers didn’t pony up some affordable units by Dec. 31.
“The financial crisis left us hanging there … but the rental market moved forward and we decided to move forward, too,” said Drew Spitler, director of development for the Dermot Company. “Everything came together at the last minute.”
When it’s built out within about two years, the colossal building will stand tall in the heart of the BAM Cultural District — Brooklyn’s burgeoning answer to Lincoln Center, with theater space, arts programming and housing units galore.
And if its surrounding residential towers have anything to say, the new tower could rent out easily, despite its lofty prices. The Brooklyner in nearby Downtown, for example, has reached 90-percent occupancy in only a year after coming onto the market. DKLB BKLN, another new and swanky condo on nearby DeKalb Avenue, is also touting itself at more than 80 percent leased.
“The rental market is strong around here,” Spitler said. “People want to live here. There continues to be a demand for new product on the market.”
And the city’s demand is gargantuan, too, considering that the new project got $1.4 million in subsidy per unit of affordable housing that developers offered.
That said, breaking ground on this tower is a big deal — other mixed-income towers, like one formerly planned for Fulton Street and Ashland Place in the cultural district, have been taken off the table because those developers didn’t get a bailout in 2008’s “shaky market.”
©2011 Community News Group
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