Karl Junkersfeld writes about his latest opus:
The attached video talks about Brooklyn Bridge Park economic development and sources of income ranging from condo and hotel construction to park concessions. BBP is designed to be self sustaining with a projected annual costs of $15.2 million for operating and maintenance expenses. The state and city are contributing over 100 million for construction of the park but daily operating and maintenance costs will be generated from the park itself. This ties in quite nicely with the concept of its environmental self sustaining elements like renewable energy generation and habitat restoration. For example, as explained in prior video, reuse of rainwater for irrigation.
As mentioned earlier, condominium development (4 newly developed condos) plus the existing One Brooklyn Bridge Park building added to the Hotel at Pier One are the major sources of income for the Parks construction. This, in my opinion, is problematic considering the precipitous drop in real estate values in New York City area. This is especially the case in the Downtown Brooklyn area. There is already a glut of luxury condo and rentals that are either recently completed or ready for completion within the year. Toren, Oro, Tillary, Avalon Fort Greene , Ratner’s building on 80 Dekalb, Brooklyner, Be@Schermerhorn, Forte, Beltel to name a few. One Brooklyn Bridge Park is approximatly 20% full and is currently holding a major sale with a 35% discount on selected apartments so they can reach the 30% threshold in oder to get proper financing from the bank. Forte went bankrupt. Be@ has been on the market over a year now and hasn’t sold any apartments and now is considering changing to rentals. From the video, does John Street at the edge of DUMBO look appealing? The view is less than stellar as you can see. If 1 BBP can’t sell, do you think that 2 condos further south will do better? As I mentioned earlier, this financing is very problematic and definitely not a sure thing. Will the City and State step in to fill the vacuum? How can 1BBP be expected to contribute anything with an empty building on their hands with the future looking like prices will decline further and a less wealthy tenant likely to be asked to supplement building maintenance to sustain a park? Remember 20 Henry? Ouch.
The theory is that that this recession is temporary and jobs will return and NYC will be like it was prior to the collapse of Lehman Brothers, the financial capital of the world. Wishful thinking. We are experiencing a structural change in both flow of jobs in the financial sector and the range of salary given to these”so called” masters of the universe.