Tag Archives: Stephen Preuss

Flushing development update: lack of space, increasing demand


| stephen.preuss@cushwake.com

Rendering courtesy of TDC Development International

In March, we discussed the development market in Flushing. Over the past couple of years, Flushing has been experiencing a rapidly increasing development market.

Approvals for multiple mega mixed-use projects were carried through — for example, the Willets Point project, Flushing Commons, and multiple hotel sites, including the Intercontinental Hotel at 36-18 Main Street, are in the development works.

Another topic of discussion in 2014 was potential upzoning for West Flushing, which would allow for increased residential development in order to provide for the dense flow of residents in Flushing. But although we have been seeing record pricing in 2015 as previously discussed, recently we have seen a lag in available land for development while demand is still rising.

Flushing has long been considered as a development Mecca in northern Queens. Its population is rapidly and consistently rising. Predominantly Asian, it is a thriving city for Asian culture, earning the name “the Chinese Manhattan.” Residential condos are selling at record prices — up to $700 per square foot for a two-bedroom condominium — and apartment rentals are seeing up to $2,000 and beyond per month for a one-bedroom. So it is no wonder downtown Flushing and its greater area has kept developers bullish over the potential.

Flushing Commons and the Willets Point project reach a square footage capacity upwards of 500,000 square feet. The amount of land left in Flushing to accommodate another project like that of Flushing Commons is significantly lacking.

We have been recently retained to sell 30-05 Whitestone Expwy. in Flushing. The site boasts 80,510 square feet of lot area with proposed plans for rezoning for a potential 523,315 buildable square feet for a mixed-use project or hotel development. Its location is within minutes from LaGuardia Airport and blocks away from downtown Flushing with great visibility from the Whitestone Expressway.

As previously discussed, the lack of space available has been a hindrance for developers — this site could serve as a rare opportunity for developers looking to capitalize on the little space Flushing has left.

Stephen R. Preuss is an executive director in the Capital Markets Group of Cushman & Wakefield, where he focuses on investment sales for various Queens neighborhoods. He has transacted in over $1 billion of investment and commercial real estate over his 15 year career. During his tenure, he has sold over 125 properties to date with an aggregate value of over $650 million.

Stephen Preuss

Stephen Preuss

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Mixed-use Bayside buildings sell for record value due to rising demand


| lguerre@queenscourier.com

Photo courtesy of Cushman & Wakefield  

Filled with bars, shops and a wide variety of restaurants, Bell Boulevard is the main commercial strip in Bayside.

The thoroughfare is serviced by buses and the Bayside LIRR station on the boulevard, which brings high foot traffic to the area.

For these reasons, and partly because of a spillover from nearby Flushing due to lack of inventory, rising demand for real estate on the Bayside commercial strip is leading to sale prices well above past averages.

In fact, the two attached mixed-use buildings at 39-32 and 39-34 Bell Blvd. recently sold for $3.8 million, which equates to about $731 per square foot and is a record for a residential and commercial mixed-use building sold in Bayside, according to broker Cushman & Wakefield.

“The package provides great upside for the investor in an area that is continuing to see an abundance of attention in the real estate world,” said Cushman & Wakefield’s Stephen Preuss, who handled the transaction for the seller.

In 2012, commercial real estate was selling for an average of $550 per square foot on Bell Boulevard and as much as $600 for top properties. Last year, the average rose to $615 per square foot, according to Preuss.

The two buildings at 39-32 and 39-34 Bell Blvd. have 5,200 square feet of space, in which there are four residential units and two ground-floor retail spaces.

As a side note, one of the retail tenants, Il Vesuvio Pizzeria, is moving a few doors down to the location of the former Okinawa restaurant and expanding to include a bar, restaurant and pizzeria.

Il Vesuvio is also changing its name to Il Borgo and is expected to open in the coming weeks.

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Developer to break ground on 45-home Whitestone project this summer


| lguerre@queenscourier.com

Renderings courtesy Frank Petruso Architect PC

The new owner of the former Cresthaven Country Club site in Whitestone is hoping to break ground on a massive development project of 45-single family detached homes by the end of the summer.

Most of the homes on the six-acre site will have approximately 2,500 square feet of living space with four bedrooms and four full bathrooms, according to Tim O’Sullivan of Fulcrum Real Estate Advisors, which purchased the site in a foreclosure auction last month for $13.6 million.

Great Neck-based architect Frank Petruso is designing the project. The current plans could change, but the 45 homes in O’Sullivan’s plans would sit on 4,000- to 6,000-square-foot lots, so each could have space for driveways and private yards. And based on the renderings, homes would have garages and basements. They could sell for $1.5 to $2 million each.

Although original plans were for 50 homes, they were shrunk to 45 so each home will have more space.

However, as smart investors do all the time, O’Sullivan is testing the real estate market to see the possible value for the site and has listed it with brokerage Cushman & Wakefield. He is taking offers for the site, but said a potential buyer would have to offer a price that “hit it out of the park” to get him to sell the site.

“Very few people get a chance to make their mark with 45 properties in an area,” said O’Sullivan, who grew up in Whitestone. “Our intention is we are in the ground in the summer. That’s the reason we bought the property.”

He added, “After we got it on auction, I had people coming to me offering me ‘X’ dollars. What we decided to do is put it out there and test the market. But we are continuing with our development plans.”

Stephen Preuss of Cushman & Wakefield, who is handling marketing for the site, said he doubts any potential buyer of the site would try to divert from the plan.

“For them to be in the ground in the next few months, they would have to follow those plans,” Preuss said. “I don’t think any developer would change those plans. It’s been well received by the community.”

Cresthaven Development Site

Cresthaven site

While residents and politicos in the area have approved O’Sullivan’s plan, they are starting to warm up to another developer’s plan for the nearby 18-acre Waterpointe site.

After negotiations with Councilman Paul Vallone, Edgestone Group, which owns the much larger site, turned away from a plan with 107 townhouses to one with 52 community-supported, single-family residences with a waterfront park, promenade, marina and other amenities.

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Flushing real estate seeking new heights


| stephen.preuss@cushwake.com

Photo courtesy of PropertyShark/Scott Bintner

Stephen Preuss is a vice president at Cushman & Wakefield who focuses on the Queens market. 

Last year showed us record-breaking pricing of development sites in the Flushing area. This year has taken those numbers upwards and has even left real estate professionals scratching their heads.

The average price per buildable square foot in the fourth quarter of 2014 throughout the city was approximately $303, which is 52 percent higher than the same period last year. Since the start of 2015, we have seen multiple properties sell at more than $300 per buildable square foot.

Just this past February we sold a development site at 142-26 Roosevelt Ave., a prime location in downtown Flushing. The property offered 21,060 buildable square feet and sold at $322.89 per buildable square foot.

Recently we have received several calls from appraisers trying to make sense of these prices where capitalization rates and price per square foot do not make financial sense.

The interest from foreign buyers has kept the interest in an upswing and has since resulted in sale prices comparable to those in Manhattan. Multiple properties especially on Northern Boulevard have sold for above average pricing, and most properties have a retail component with development potential.

For example, 138-12 Northern Blvd. in Flushing sold at $341.27 per buildable square foot. The property consisted of a four-unit retail strip, but allowed for an additional 20,000 buildable square feet to be developed on site.

We have been seeing an exponential amount of interest in development since 2012 and expect the remainder of this year to follow suit.

Stephen-Preuss

Stephen Preuss

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Trio of sites in Briarwood and Oakland Gardens trade hands for $23.7 million


| lguerre@queenscourier.com

Photos courtesy of Cushman & Wakefield

The owner of three commercial sites scattered in Oakland Gardens and Briarwood sold the properties for more than $23.7 million, according to real estate firm Cushman & Wakefield, which handled the transaction.

The deal involves the cluster of properties at 221-02 through 221-50 Horace Harding Expressway, 137-67 to 137-79 Queens Blvd., 138-09 84th Dr., and 138-07 to 138-11 Queens Blvd., which the real estate firm refers to collectively as “The Vanguard Retail Portfolio.”

Together there are 28 units throughout the entire sale with a combined 44,858 square feet of space.

Of the properties, the largest cluster on Horace Harding Expressway in Oakland Gardens has about 33,698 square feet and 18 retail units with some space for parking.

It has up to 53,159 square feet of buildable space, according to the real estate firm. This one cluster was sold for nearly $17 million.

The properties were purchased by a local investor above the asking price, which was $23.1 million in September, according to Cushman & Wakefield.

“We received an abundant amount of interest contributed to by the continued lack of quality assets for sale along with the desirability for larger retail product,” said Stephen Preuss of Cushman, who handled the deal with Brian Sarath and Thomas Donovan.

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Commercial real estate: 2015 market forecast


| stephen.preuss@cushwake.com

THE COURIER/Photo by Liam La Guerre

2015 is expected by many to be the best year since 2007. According to a Cushman & Wakefield research report, the U.S. economy is projected to grow in the 3.0 to 3.5 percent range (which is a conservative number), giving credit to the decline in oil prices. The decline in oil prices will help to “stimulate stronger consumer spending, cut costs in manufacturing and transportation and lower the trade deficit.”

Although it has been stated several times over the past couple years, interest rates are still expected to rise within the next year. According to the federal government in a statement released after the Federal Open Market Committee meeting in December of 2014, the central bank will begin to raise interest rates in the first half of 2015. The rise of interest rates will continue as the market is tested to see how much the economy can handle. As a rule of thumb, as the economy grows stronger, interest rates will push higher.

Aside from a growing U.S. economy we are also seeing a decline in unemployment, a rise in spending, and although rising, fairly low interest rates, which makes a great recipe for a strong real estate market. We can anticipate demand increasing both in purchasing and an increase in rents in all property sectors including office, industrial, retail, multifamily and hospitality.

Recent studies show business investment in the last 12 months has significantly increased, and business spending is expected to increase, boosting the economy and creating more jobs. In just December of 2014 the U.S. economy added 252,000 jobs. Over the last three months of 2014 a total of 866,000 jobs were added. The creation of more jobs can lead to an increase in demand for office space and also further demonstrates the increase in business investment and spending, creating a better environment for commercial real estate.

The sum of the U.S. economic growth is expected to pave the way for a flourishing real estate market in 2015.

Stephen Preuss is a Vice President at Cushman & Wakefield who focuses on the Queens market. 

Stephen-Preuss

Stephen Preuss

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Astoria waterfront warehouse listed for $18M, could become residential building


| lguerre@queenscourier.com

Photo courtesy of Cushman & Wakefield 

Another Astoria waterfront industrial site recently hit the market and could be sold to an investor looking to develop the property into a residential, mixed-use structure, which has become a trend in the area.

The owner of the vacant, one-story warehouse located at 30-05 Vernon Blvd. bought the property last year for $3 million, according to city records, and was hoping to transform it into a mixed-use condo, office and ground-floor retail building. Construction permits were never filed with the Buildings Department, but renderings were created for the potential seven-story structure.

3005 Vernon Boulevard Joint Venture, which is listed as the owner, pulled the plug on its own project and is now selling the development site for more than six times what it sold for last year.

The asking price is $18.24 million, according to Cushman & Wakefield, which is marketing the site. The site has up to 96,000 buildable square feet for a mixed-use development, and its price breaks down to about $190 per square foot, which isn’t topping premium levels for sites in the neighborhood.

The property has only been on the market for about a week, but more than 50 investors have called to learn more about it, according to Stephen Preuss of Cushman & Wakefield.

Preuss and David Chkheidze are the agents marketing the site. 

Photo courtesy of Scott Bintner/PropertyShark

Photo courtesy of Scott Bintner/PropertyShark

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Developing Queens: How the Massey Knakal sale will affect the borough


| lguerre@queenscourier.com

Photos courtesy of PropertyShark/Scott Bintner and Stephen Preuss

New York City-based Massey Knakal Realty Services was sold to international real estate firm Cushman & Wakefield on Dec. 31 for $100 million. Stephen Preuss, a former vice president at Massey Knakal in Queens, talked with real estate editor Liam La Guerre about how the sale to the international firm will impact the Queens division and its clients.

La Guerre: Congratulations on now being with a larger firm. Will there be any changes to the Queens division now that Massey is with Cushman & Wakefield?

Preuss: We have a very successful strategy with a territory system, and we have seasoned agents here that have a high market share and are very successful at doing what we have been doing, which is selling properties in Queens. Nothing is going to change here; it’s just going to improve with the CW name and resources.

La Guerre: Massey Knakal was on some large sales in Queens for the year. Some highlights include a garage and commercial strip in Jamaica for $22 million, the 1,270-unit apartment complex in Kew Gardens for $216 million and the Astoria commercial building for $32 million. Any idea of how much in sales Massey did in Queens in 2014?

Preuss: We’re still tallying up, because we did do a lot of transactions toward the end of the year. For Massey Knakal as a whole, we are going to be right around the $5 billion mark. In Queens, again we are still counting, but it will be in the several hundred million dollar range.

La Guerre: How does this sale help your clients now that you are with a bigger firm?

Preuss: [Cushman & Wakefield is] a full-service, global commercial firm that does all types of real estate advisory services. Now we can deliver a higher level of service and get better results for our clients and our buyer pool, which was mostly Tri-State investors, is going to increase now that we have offices all over the world.

La Guerre: That exposure to the international network will be helpful to your Queens clients since the borough’s real estate market is exploding.

Preuss: I agree. I think it’ll not only help the mid-level pricing assets that we work with, but it’ll also help us achieve, attain and excel at some of the higher-price assets that we really didn’t handle before. All across the board this is a very positive move for people at Massey Knakal and the Cushman Wakefield brand.

La Guerre: Queens is still an emerging market when compared to the city, and there are some areas that people just don’t know about. Did Cushman see value in Queens when it was acquiring Massey?

Preuss: Yes, actually. Cushman & Wakefield executives made it very clear that the boroughs are going to be a big focus and is a big reason why they acquired Massey Knakal, and Queens in particular is going to be big for them. They are going to put a lot of resources behind us to really continue on with Queens as an emerging market.

La Guerre: How does 2015 look for real estate in Queens?

Preuss: Queens will continue to be an area where not only Queens-based investors look, but Brooklyn and Manhattan investors are going to continue to trend toward Queens because of the value here. I believe 2015 will even surpass 2014.

Stephen Preuss

Stephen Preuss

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Whitestone waterfront for sale, development


| aaltman@queenscourier.com

Photos Courtesy of Massey Knakal Realty Services

House hunters searching for outer-borough bliss may soon find sanctuary on a scenic Whitestone cove, as 13 acres of waterfront property — the single largest building site in the borough — is now for sale.

The site, located at 151-45 6th Road, is currently overseen by real estate agent Stephen Preuss of Massey Knakal Realty Services. He is confident that sale price maximization will be possible over the next few months. Preuss alleges the property, which became available via short sale, has already been approved for the construction of 52 single-family homes by the City Planning Commission as well as the “proper community channels,” including Community Board 7.

“We shouldn’t have any problems picking up these plans and moving forward,” said Preuss.

According to Preuss, the land will most likely be purchased by a single developer rather than broken up into smaller plots, adding that the buyer may choose to build in phases as opposed to assembling the entire area at once.

Five of the 13 acres are submerged underwater, which, according to Preuss, the builder would most likely convert into a marina or boat slips.
“It’s one of the most desirable areas in the borough,” he said.

The average waterfront home in Whitestone sells for $2 million, according to Preuss.

State Senator Tony Avella supports the development so long as it adheres to the current plan of 52 single-family homes. Straying from this, Avella threatens, will meet “fierce opposition from the community and me.” As the land is currently an industrial site, Avella believes the addition of a well-thought-out housing complex will be an asset to the community, rather than a detriment.

“A lot of work was put into this plan which will match the character of the neighborhood and set a precedent for future development,” said Avella.