October 29 2015
Gentrification strikes Alphabet City
New York Post
By Zachary Kussin
October 29th, 2015
Nothing captures today’s Alphabet City better than one single block: Second Street between avenues C and D. Vacant, but graffiti-covered commercial spaces lead to drab tenement-style buildings and some truly no-frills retail storefronts.
But at the end of the stretch stands The Adele — a newly constructed luxury rental where a listed two-bedroom apartment with floor-to-ceiling windows has a market value of $5,095 per month.
Sure, this gritty East Village enclave saw its fair share of shenanigans related to drug use and violent crime not terribly long ago, and perhaps that’s one reason why new housing construction here has remained relatively dormant — until now.
One block north of this Second Street scene, Venetian Management’s 30-unit building at 321 E. Third St. reportedly topped out in June. Venetian could not be reached for comment, and it’s not clear whether the structure will house condos or rentals. Meanwhile, developer Douglas Steiner — who didn’t return a call seeking comment — is working on what signs say is a mixed-use project at 438 E. 12th St., which building permits further specify has 82 units and 8,376 square feet of commercial space. There’s also 67 Ave. C — an eight-apartment condo, which launched sales in August, is currently half-sold, and now has apartments priced from $865,000 for a one-bedroom.
Yes, at last, Alphabet City is getting a healthy dose of nice housing, and experts agree the activity there comes hand-in-hand with downtown’s development boom. But it also marks developers’ discovery of the area’s cheaper land and convertible buildings. Combined with buyers’ strong demand for downtown living, this previously overlooked zone is filling up quickly with more upscale new options. (They’re a far cry from the rundown artists’ shacks immortalized in the ’90s hit musical “Rent.”)
“It’s booming right now,” says Miron Properties honcho Jeff Schleider. His firm leased out the 33-unit Robyn rental at 316-318 E. Third St. between avenues C and D last year, which now has three listings with asks spanning $3,095 to $4,450. He adds that even with this activity, Alphabet City is still largely home to income-restricted co-ops and rental buildings, lending itself to economic diversity that he says is positive for the nabe. Most of all, he says, the area still has charm. “It really is a neighborhood — you see the same people over and over again,” he says.
A homey feel is a great draw for any interested resident, but prices in Alphabet City deserve special attention. Median asking prices here rose a slight 2.79 percent to $699,000 year-over-year through the end of 2014, according to StreetEasy tallies. But from January through the end of September in 2015, they soared to $865,000. It’s a notable increase, but still a better deal than the East Village’s median of $955,000.
“You get a little bit of a price break because you are farther east,” says Corcoran broker Georgine Paulin, who’s handled deals in the area for over a decade.
Prices in Alphabet City, in part, encouraged visual display artist Adrianna Gardini Youngren and husband Craig to snag a 500-square-foot unit in the neighborhood this spring, which Paulin had listed for $440,000. (Buyers had to meet income restrictions.) They’ve since moved in with their children Miranda, 6, and Clark, 1, in tow.
“I assumed that Manhattan was out of our price range, but when I looked at Brooklyn, it was unaffordable,” Gardini recalls. “We were looking all over … the right one was going to hit us in the face at some point.”
Beyond the friendly atmosphere and better prices, sources say Alphabet City’s creative spirit — thanks to a long-standing community of artists — is another lure for house hunters. For example, it’s home to the Nuyorican Poets Cafe, a famed institution for slam poetry, music and visual arts located at 236 E. Third St., which always draws big crowds. “Its indy, edgier vibe is what a lot of people respond to,” says Halstead’s Ari Harkov, who together with Warner Lewis is marketing the 11-unit 324 E. Fourth St. — a development that is turning a four-story rental into a spiffy seven-story condo.
Mortar Architecture and Development handled both the design and the construction of this building, which should reach completion in early 2016. The project launched sales two weeks ago, and now has a two-bedroom spread on the market for $1.45 million. “There are these elements that make [Alphabet City] the old school New York that you don’t see anymore,” says Anthony Morena, Mortar’s principal.
Not far away is 189 Ave. C, a conversion project at 12th Street that launched sales in August. A studio here is going for $725,000.
“There are great amenities, such as a very hot restaurant scene,” says Douglas Elliman’s Rob Gross, who’s leading sales at 189 Ave. C, of nearby perks.
And he’s right. Especially around Ninth Street and Avenue C, there are a number of fun options.
There’s Latin-fusion eatery Esperanto, which stands kitty-corner from The Wayland, a bar with food and live music. Down Avenue C, Lois — located between Alphabet City Beer Co. and Alphabet City Wine Co. — serves wine and bites in cozy settings. Across the way is popular beer hall Zum Schneider. Over on Avenue B is Oda House — a Georgian restaurant that opened in 2013 to rave reviews.
“What’s nice about the East Village is that it’s finally becoming residentially amenable to everybody,” says Nest Seekers’ Ryan Serhant — who’s gearing up to launch sales at Magnum Real Estate Group’s 33-unit 100 Ave. A. Meanwhile, Magnum’s president, Ben Shaoul, says the area’s “very cool modern bohemian lifestyle vibe” is a winning factor for buyers.
“I feel like it’s the real New York,” says Cherie Hinson, a Nest Seekers International agent who recently bought a condo at the sold-out Seven East Village, or 277 E. Seventh St., which her boss, Serhant, helped market. “People create their own businesses and thrive. That’s what this city is all about.”
Such commercial activity stems in part from buzzing residential development. But not everyone views all these changes as positive.
“These developments bring Walgreens, boutique shops and upscale restaurants, not bodegas where you can go and shop on credit,” says Eric Lugo, 54, who’s lived on Avenue C for the past 24 years, though he does admit the changes have made the area both trendy and safer. “These developments ended the days when you sat on your stoop and knew virtually everyone who passed by name. It’s definitely my neighborhood, but it used to be my community, and losing that is sad.”
To Lugo’s chagrin, construction continues, even on Alphabet City’s fringes. One building, 415 E. Sixth St. — a three-unit conversion between First Avenue and Avenue A that will have residences spanning roughly 2,000 to 2,500 square feet — anticipates a fall sales launch with pricing from $2.95 million for a full-floor apartment.
“It’s the only neighborhood left that’s quintessentially downtown,” says one of the project’s developers, Jody Kriss, of East River Partners, “and provides good value.”