Real Estate

Real Estate Group Spends $42.5M On Six Area Apartment Buildings

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e 19th street between beverley and albemarle
Manhattan’s Sentinel Real Estate has purchased six local buildings comprising 261 units for a total of $42.5 million, says The Real Deal.

The firm, which already owns approximately 32,000 rental units across the US, added buildings at 259 E 18th Street (between Beverley and Albemarle Roads), 287 East 18th Street (on the corner of Beverley Road), 120, 146, and 165 East 19th Street (all between Beverley and Albemarle Roads), and 2105 Foster Avenue (on the corner of E 21st Street) to their roster on April 29.

The buildings were bought from Pinnacle Group. The Real Deal says current average rents of the units sold range from $870-1,344 per month.

“So basically 261 families are screwed,” said one Brownstoner commenter of the transaction.

“The only way this deal makes sense is if the buyer is assuming a significant number of tenants can be ‘induced’ to leave thus allowing their units to be renovated and rented at market rates,” said another, although he added he was skeptical of that strategy’s success.

As with other recent rental building purchases like 1834 Caton Avenue and 220 E 18th Street, this deal seems a bit worrisome to us in terms of longtime or low income tenants retaining their homes.

“It’s exactly what you think it is,” says Aga Trojniak of the Flatbush Tenant Coalition, “a predatory equity company buying buildings (from another predatory equity company) at an incredibly inflated price so the only way they can make their money is to evict long-term tenants en masse. I expect tenants in these buildings to face lack of repairs (while vacant apartments are fully renovated), random nonrent fees, frivolous court cases, repeated MCI rent increases, and more.

“But tenants can fight back — this is not a foregone conclusion.  Organizing together brings power — with a strong tenant association, tenants can protect their homes. We will be reaching out to folks in these buildings to make sure everyone knows their rights, what to expect, and how they can work together to stop the plan to illegally gentrify these buildings.”

We’d be interested to hear if neighbors disagree. Any tenants of the aforementioned buildings and/or local real estate buffs care to weigh in?

 

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37 COMMENTS

  1. My husband and I are residents of 165 E 19th, where we have lived for 3 1/2 years. Many would already see us as harbingers of gentrification, but the fact remains that we would not be able to afford a rent much above what we pay now. We have come to love the neighborhood and building so much in our time here that it makes me sad to acknowledge that the new ownership is a moot point to us, and that our already-planned move in a few months’ time (for the purpose of attending school) will make it nice and easy for them to carry out their objective with one of the biggest units in the building. Feels icky.

  2. There is a lot of negativity in this post given that the writer doesn’t seem to know what Sentinel’s plans are. Maybe they–gasp–want to invest in our neighborhood by improving the buildings? Maybe they will be much better landlords than Pinnacle? Anonymous comments on Brownstoner don’t seem like much of a source to quote.

  3. when you move the rent spikes.. that’s why they love white tenants.. you pay on time and you never stay long.

  4. No, it is obvious what they are doing. They are Terraforming traditional poor black neighborhoods for the expected mass migration of white settlers. People with money need some place to live too.

  5. I certainly hope you’re right, JC. I hope there are people willing to invest tens of millions of dollars to be good landlords to existing tenants who are paying low rents. I’m sure it’s possible.

  6. Ummmm……I don’t think this has anything to do with COLOR – whether one is black, brown, white, yellow, red or purple.
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    Landlords SHOULD expect tenants to pay their rent. This is a free market and capitalist society following the rules of supply and demand.
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    The concept of “paying your rent on time” SHOULD be a priority – and if you can’t pay it then you need to move to a location where you CAN manage your bills. *shakes head*

  7. Correction: “somewhat free market” (there’s too much government meddling)

  8. I know it depends on which side of the coin you’re looking at – but if you’re a renter you have to understand two things. 1) the rent will ALWAYS go up 2) landlords can kick you out (or “screw you over”)
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    42.5 million divided by 261 units = $162,835 per unit. Even taking the higher end of the rental rate ($1344) it’ll probably take Sentinel at least a couple of years to recoup their investment (even with tax breaks or the added renovation costs). And the goal of ANY business is to MAKE MONEY.
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    Otherwise it’s called a charitable organization.
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    If you don’t want to be “screwed over” housingwise – scramble for every dollar, save it, and BUY. You’re always going to have to pay SOMETHING to keep a roof over your head (even when you are mortgage-free, there are maintenance fees & property taxes).
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    And no, don’t tell me you can’t buy in a location you want to live in – you have to buy in a “questionable neighborhood” that you can AFFORD. And with some patience and luck, your investment will appreciate.

  9. True…….. too true. except color is an indication of culture. And the whites have all the money.

  10. Hopefully somebody does something to help people who want to stay in their neighborhood regardless of trendy market activity. Something is already in the works.

  11. No place exist in NYC any more. My black family are lucky to own buildings..and houses..so we stay.. but i feel for the rest.

  12. I don’t know anything about real estate or business, but 240 units divided by 6 is 40 units per building; 6 units divided by $42 million is $7 million per unit. Is that an “incredibly inflated price” as the rep from the Tenant Coalition put it? I’m not being sarcastic, I’m genuinely asking, because $7 million for a 40-unit building doesn’t seem like that much when individual homes go for over $1 million alone. Can someone savvier than I am please explain? I realize the investment will take time to hit its break even point and even longer to turn a profit, but if we’re talking about a company with many, many holdings, why couldn’t this be seen as a long term stable investment, especially in light of DeBlasio’s efforts to create and maintain affordable housing. I realize I’m being naive about the success of that effort, but still. Please explain.

  13. Its about 1/3-1/2 market price – because of all the stabilized tenants. They’d basically be winning the lottery if the units were somehow destabilized – but they can still turn out a healthy ROI on this purchase even if they only get the increases mandated by the city.

  14. Quite a statement. Last time I checked being poor and underemployed was a colorless issue.

  15. Nope…just look around.. only one type of people are being priced out of their traditional neighborhood..

  16. “TRADITIONAL” – just how far back does your traditional extend? 10 years? 20? 50? 100? 500? Let’s see – Lenape native americans, then white dutch settlers, then white europeans, then white flight, then poor black. I think you need to visit the Brooklyn historian or at least pay attention to the origin of street and neighborhood names in BREUCKELEN!

  17. If they can make a healthy ROI without needing destabilization, why is there the assumption that there will be? Again, not trying to be sarcastic, I’m just wondering if people know something we don’t.

  18. After the white flight.. internet warrior. “BREUCKELEN!” hahah jokes and thoughts one can only say on the internet. I hope your not one of those realestate Israeli immigrants.. I see how they treat black jews over there, now all of a sudden their buying up all the apartment buildings in black neighborhoods and kicking people out at a breakneck pace.. if they think people dont notice they have another thing coming.. all it takes is one incident…… 10 years huh…………. then you missed the last riot.

  19. You’re not making any sense. You said “10 years is not nearly long enough”. So tell me – not long enough FOR WHAT?
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    And how am I “self entitled”???

  20. Moonandstar – please clarify.
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    You mentioned in a post above, white tenants “pay on time and never stay long”. Then you say that “color is an indication of culture”. So connecting the dots, am I to assume that CULTURALLY only ‘white people’ pay their rent on time?
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    That statement is insane. People who prioritize their bills pay their rent on time.
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    But what I find interesting is somewhere below you said your “black family” owns buildings and houses. So I wonder – do YOU prefer to rent to white people who (supposedly) pay their rent on time and leave in a couple of years allowing you to raise the rent to market prices?

  21. New(er) tenants can join the fight to preserve affordable housing in a lot of ways. First step: get your complete rent history from DHCR 718.739-6400. Call them, tell them you want your COMPLETE rent history. They’ll mail it to you in a few days. This will tell you how much the tenants before you were paying for the apartment. And we (Flatbush Tenant Coalition) can help you figure out if there’s a possible overcharge involved – 718.635-2623. If there is, you can file a complaint with DHCR and get back whatever you were overcharged. And the rent will be set at the appropriate legal level for the next tenant. Doesn’t solve everything, but it’s a big step in preventing illegal rent increases.

  22. The assumption is based on the past behavior of virtually all landlords in similar cases.

    But maybe this one is different.

  23. New(er) tenants can join the fight to preserve affordable housing in a lot of ways. First step: get your complete rent history from DHCR 718.739-6400. Call them, tell them you want your COMPLETE rent history. They’ll mail it to you in a few days. This will tell you how much the tenants before you were paying for the apartment. And we (Flatbush Tenant Coalition) can help you figure out if there’s a possible overcharge involved – 718.635-2623. If there is, you can file a complaint with DHCR and get back whatever you were overcharged. And the rent will be set at the appropriate legal level for the next tenant. Doesn’t solve everything, but it’s a big step in preventing illegal rent increases.

  24. Sorry, but no, I have no idea who Jaguar is and I’m not an alias of any kind. I’m just a regular person raising a family in Ditmas Park.

  25. I think this is great news for all who love this area. If the intention is to revitalize these buildings. I feel sorry for those who will get pushed out because of rising rents but that is a fact of life in NYC. I recently put down roots in this neighborhood because I was pushed out of my neighborhood I lived in for 10years due to rising rents. In that neighborhood whites were pushing out long time residents which were also white and you didn’t hear the same us vs them rhetoric. Older residents just said they were leaving because the neighborhood was getting too expensive. We moved here (one of the only neighborhoods we could afford) to purchase an apt to raise our family. By doing so we participated in raising local prices. We are surrounded by numerous long time residents who are happy with the influx of newer families since they are greatly benefiting from the increase value of their homes. NYC is an expensive place to live and only getting more so and people of all races get priced out of their neighborhoods and have to move on unless the own a home then the story is different.

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