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October 31, 2008



The leasehold to a rare piece of property (and one of the best pit stops on the Belt) is up for grabs in Brooklyn—the 294k-SF, 100% occupied Ceasar’s Bay Shopping Center, which has an additional 30k SF expansion opportunity for a potential big box retailer. We went to CBRE offices at the MetLife Building to hear more from SVPs Ned Midgley and Tim Sheehan, who are marketing the property on behalf of SALTRU Associates.


Tim and Ned with associate Dan Kaplan, who’s also working on the sales team along with assistance from vice chair Bill Shanahan and EVP Jeff Babikian. They tell us what makes the property so attractive is the fact that big box sites in Brooklyn are uncommon. The potential to build another 30k SF, two-floor store—the approximate size of a generic Best Buy—also creates the possibility for an extra $1.5M in annual net operating income. Not too shabby, considering the property is already debt-free and earns in excess of $8M. The sale price has not been disclosed, but the team estimates that a potential institutional or high-net investor would have to put down substantial equity based on today’s debt markets. Bonus point: the site is located at the prime intersection of the Belt and Bay Parkways, which makes the center quite visible to everyone stuck in Staten Island and Jersey-bound traffic.


The tenant roster includes Kohl’s, Toys “R” Us, Babies “R” Us, Best Buy and Modell’s, among others. The property sits near one of most residentially dense areas of Brooklyn, whose 2.5M population is already underserved by retail—consider that the national average is 21 SF of retail space per person, yet the borough averages only 15 SF per person. It baffles us why the seller would want to let go of the leasehold, but Ned tells us that the SALTRU partnership—who rescued the property from bankruptcy 27 years ago—believes that the time has come to realize the partnership’s success. We’ll take their word. In the meantime, you can find recreational runners Tim and Ned on the sidelines this weekend, cheering on CB colleagues competing in the ING New York City Marathon.

Ray of Light in Midtown?

We love positive people (and who doesn’t need a bit of sunshine these days?), so we walked down the hall to have a chat with CB Midtown vet Matt Van Buren, who happened to be reading Bisnow when we walked into his office. No, he wasn’t kissing up to us, but he was admiring the nice shot we took of him at the firm’s quarterly breakfast a few weeks ago. We digress. Matt told us that although the investment and leasing markets have been quiet recently, the right signs are there that action is being taken to correct the economy, which will trickle down to commercial real estate. We’ve been through this many times, he said, but other downtowns were worse—this looks like an average-sized headache. Tylenol, anyone?


But Midtown looks like it will fare the best out of all submarkets, thanks to its undersupply and its considerably lower vacancy. Even with all the financial layoffs, history has taught us that these employees will find other shops or start their own platforms, which can only be positive. It also helps that the submarket houses two of the fastest growing industries, legal and media/entertainment. Verdict? Midtown never falls as far and bounces back the quickest. In the meantime, Matt’s taking the time to hone his craft and be more present with clients. When he’s home, he likes to decompress by walking his chocolate lab, whom he reports has finally stopped walking him.

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