A deal has been reached to sell a major Gowanus development site that is co-owned by one of the largest commercial landlords in the city SL Green and White House adviser Jared Kushner’s company Kushner Cos., according to a report by Crain’s News with confirmation by multiple sources with knowledge of the transaction.
The site spanning 140,000-square-feet is located at 175-225 3rd Street in Brooklyn, along the Gowanus Canal, and currently functions as a parking lot. The property is being purchased by RFR Realty for the rumored price around $120 million.
In 2014, the site was bought for approximately $70 million by Kushner and SL Green. Kushner held a 5 percent share while the majority 95 percent was owned by SL Green. All the shares held by both partners are being sold to RFR Realty.
According to Crain’s, “The development parcel is part of an area of Gowanus that many planning experts and real estate investors expect the city will soon rezone. The city could embark on a public review of that rezoning as early as March, which if approved will likely permit larger residential and commercial buildings to be raised in a neighborhood long populated by low-rise industrial and warehouse properties. The deal will liquidate the only partnership between Kushner and SL Green, a $10 billion public real estate company. Kushner’s involvement in the Gowanus development site had been viewed as problematic by some real estate investors in the area, according to sources, because of the antagonism it spurred from city officials who hold sway over the Gowanus rezoning. Jared Kushner, who had been chief executive of the company before joining his father-in-law’s administration, has been making headlines recently for losing his top-secret security clearance.”
Back in November, the local councilman Brad Lander, whose approval is required for any rezoning in the Gowanus area, told WNYC, “Voting to take part in enriching the White House senior adviser … that feels ethically tainted in a way I don’t see how I could do and how I could ask my colleagues to do.”
SL Green is the second major New York City landlord to recently work to depart from its partnership with the Kushner.
On behalf of SL Green and Kushner the deal was handled by brokers Doug Harmon, Kevin Donner and Adam Spies of Cushman & Wakefield.
A source told Crain’s that the RFR is planning to rezone the site from 280,000-square-feet of buildable space to just under 1 million-square-feet.
By Mark Snyder