By Sierra Brown
Adrienne Blanks, 26, loves her chic two-bedroom apartment. The wood floors, granite tabletops and brand new Frigidaire dishwasher and refrigerator attracted her to the cozy Bedford-Stuyvesant abode. At $875 a month — $1,750 that she splits with her roommate — her building, known as the Stable House, is a bold step up from the vermin-plagued home where she lived in West New York, N.J., until she moved to Brooklyn in February.
“Sometimes I don’t want to leave because it’s so comfortable here,” Blanks said of the property that also boasts a game and reading room and laundry room. Though the apartment costs $250 more than her New Jersey digs, where she had lived since 2007, Blanks said that the amenities and security still make the apartment a great deal. “I don’t have to get a gym membership, I can just go downstairs,” she said.
But the apartment wasn’t meant for Blanks to rent. Blanks, managing director of TheBlvd.com, is just one of the many renters reeling in deals after a condo bust that has left stale condominium sales throughout the area for over a year.
Situated on Bedford and Jefferson avenues, the Stable House is like so many others in Bedford Stuyvesant — one of the neighborhoods hit hardest by foreclosures in the city. From September to November last year, the median sales price decreased by 18.4 percent and the number of sales decreased by 14.3 percent. Average price per square foot decreased by 24.1 percent, down to $161 compared to the same period last year, according to Trulia.com.
Condo sales in Brooklyn have plummeted from 979 sales during the third quarter of 2007 — a high — to 463 sales during the same period of 2009, according to data from Miller Samuel, a real estate appraisal company. The median cost of an apartment or house in February 2010 was $485,353, 14.87 percent lower than the $570,110 high of August 2007, according to Departmentofnumbers.com, which tabulates rates from New York City rolling and annual property sales.
“The condo market isn’t where their hopes were. They paid big numbers for their land during the craze, if you will,” said Michael Amirkhan, vice president of sales at Massey Knakal Realty Services, who covers Bedford Stuyvesant. Amirkhan said that several buildings in the neighborhood are now being sold as rentals, including a 15-unit project at 552 Lafayette St., at 354 Franklyn Ave. and, most notably, the Mynt building — a mammoth 72-unit complex at Myrtle and Nostrand avenues — that has become a rental property.
“Renting out the units makes a lot of sense — there is a steady stream of Manhattanites and West Coasters migrating to Brooklyn, and brand new condo projects make very desirable rental apartment,” Carlos Angelucci, chief operating officer at Rapid Realty, said in an e-mail. Many former condos are much more spacious than rental units designed to maximize bedroom count.
Justin Richardson, a transplant from Washington, D.C., looked at a duplex in Crown Heights that was originally supposed to be a condo, a refurbished brownstone featuring brand new amenities and electronic fireplaces in every room. The four-bedroom unit would have cost Richardson, 24, and his three roommates $550 each. “It was the perfect bachelor pad,” he said.
Castle Braid, an eclectic rental property, equipped with a recording studio, woodshop and yoga — welcoming to the local Bushwick arts community — was built as a condo, but the poor market persuaded its developers to rent instead. “Nobody is buying right now and some are having trouble renting,” said Taylor Clark, marketing director for the complex. Clark said that converting the space to a rental has been positive. Ninety percent of the 143 units were full in six months, he said. Condos, which are then turned to rentals, cannot legally return to condo status, so the decision to go rental is a serious one for developers. Yet Clark maintained that rentals are more profitable in the long term. “Over 20-30 years apartments make more money,” he said.
Still, renting is only an option for developers who can afford it. Some developers do not have enough flexibility with their lenders to convert to rentals.
“If you bought the wrong building at the wrong time, you may be stuck in a situation where no amount of rent is going to cover your financing,” Angelucci said. “That’s why we’ve seen so many smaller developers lose their building and their shirts. If there’s any chance of them holding onto their project, though, they should definitely be renting those units out — some money is better than no money.”
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