March–April, 2008 / Feature

The no-risk approach

Glass panes: The Richard Meier–designed On Prospect Park condo rises above Grand Army Plaza just to the east of Park Slope. Its developers are confident that they can lure big-spending Manhattanites to Prospect Heights. The initial word is that they’re right.

By Gersh Kuntzman

The Brooklyn Paper

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Gregory P. Mango

Lou Greco (left) and partner Mario Procida atop their On Prospect Park building.

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The adjective that keeps appearing around the names Louis Greco and Mario Procida is “gutsy.”

The word on the street — not to mention the word on the Street — is that Greco and Procida showed incredible intestinal fortitude and rare fearlessness in planning and building On Prospect Park, the glass-walled jewelbox at the corner of Eastern Parkway and Plaza Street East, just across Grand Army Plaza from Park Slope.

It is said — as indeed it was said in the New York Times earlier this year — that “developers are watching” the “gutsy” project “with keen interest and some skepticism.”

Not to take anything away from Greco or Procida — or the Times — but “gutsy” is not the right adjective.

Indeed, is there any more charmed building than On Prospect Park?

It is on the market years before the comparably innovative, Frank Gehry–designed buildings at Atlantic Yards even have a shovel in the ground. And it looks as though Greco and Procida’s 114 units will be sold out by the time the stunning renovations at the Williamsburgh Savings Bank tower or One Brooklyn Bridge Park are even finished.

And compared to the generic wedding cakes that are spreading faster than kudzu on Fourth Avenue, On Prospect Park is a gem.

Community resistance? A British tabloid reporter with a thick checkbook wouldn’t be able to uncover neighbors with a significant complaint about how Procida and Greco acquired a synagogue parking lot for $4.5 million, presented their designs, marketed their product and started construction.

“These guys came to fill us in on everything even when they don’t have to,” said Robert Witherwax, a member of Community Board 8, who lives a few doors down on Eastern Parkway. “They go above and beyond.”

Greco and Procida have also been credited for taking a risk in hiring Richard Meier to design On Prospect Park. Meier had already redefined the residential tower with his two glass-walled buildings on West Street in Manhattan — and gotten those developers far higher prices than anyone thought possible — alongside a busy highway so far from a subway.

And the Brooklyn building had the advantage that Meier would be designing the apartments, too, not just the structure, as he did in Manhattan.

So “gutsy”? Not really.

Given how many people — rich people, that is — who are clamoring to live in a Richard Meier–designed shell in Manhattan, it was hardly a risk to believe, as Greco and Procida do, that there would be enough of those stylish people left over to fill On Prospect Park.

But if there is any scant doubt, it is this: would those Manhattan exiles pay $1,400 a square foot — among the most expensive prices in Brooklyn history — to live in an outer borough? And would they pay such a price for an apartment that’s not even in a hip, happening, one-subway-stop-away neighborhood like DUMBO or in gold-plated Brooklyn Heights, but so deep into Brooklyn (just beyond Park Slope) that the closest subway stop is actually named “Eastern Parkway” and the name of the neighborhood — Prospect Heights — might sound like a real-estate-broker euphemism for Crown Heights, an area still known for the 1991 race riots.

The answer, experts say, is “yes.”

“Will it be that powerful Wall Street guy? No,” said Ira Krivit, director of sales in Prospect Heights for the Massey-Knakal real-estate firm. “But there are enough people who have done well for themselves and want the best.

“Hindsight is 20-20,” Krivit continued. “Now, everyone is saying, ‘Oh, of course that building makes sense.’ But Greco and Procida were the ones who actually put their neck on the line and built it. That was bold. This building will permanently change how people feel about the neighborhood.”

Prices at On Prospect Park are comparable to those at One Hanson Place, the luxury condo conversion of the Williamsburgh Savings Bank tower (where you don’t get a park) and at One Brooklyn Bridge Park, the conversion of an old Jehovah’s Witness building on the Brooklyn Heights waterfront (where you don’t get a subway).

At One Hanson, $1.75 million gets you 1,595 square feet, two bedrooms, and two baths. At One Brooklyn Bridge Park, the same money gets you 1,523 square feet. At On Prospect Park, it gets you 1,137 square feet and a balcony.

Then again, at the flashy new J Condo tower in DUMBO, $1.45 million will get you a 1,592-square-foot, three-bedrooms, two-and-a-half bathroom apartment on the 21st floor with killer views of the Manhattan Bridge and the Financial District.

So if there’s any risk at all, it’s the question of whether Greco and Procida have misread the complicated nexus of location, price, amenities and market.

Of course, they don’t think they’ve misread anything.

“We think it is actually in a great location,” said Procida, who once predicted that On Prospect Park would be the “most aesthetically significant structure” in a borough that’s home to a world-famous bridge.

“This building was carefully crafted and designed. It breaks the mold of the normal residential building. Normally, residential buildings are, frankly, regular. But this has Richard’s design imprint all over it.”

Originally designed at 114 units, several buyers have already snatched adjoining apartments and combined them. The building is now 102 units, Greco said.

“There was, apparently, a demand for four-bedroom apartments,” he said, mentioning that they start at about $3 million.

Working with Meier on an A-list building puts Greco in lofty company — a stretch from the 1980s, when he got started doing loft conversions in Manhattan. He jumped the river and started doing renovations in Brooklyn Heights, first at 71 Pierrepont St., where in 1997, Greco turned a former SRO into four high-end condos with a two-story “carriage house” that earned approval from the Landmarks Preservation Commission. Next, in 1998, he took five rundown commercial buildings on Court Street in Brooklyn Heights, added three floors, and created 44, loft-style residential units.

But it was his loft-style building at 322 Hicks St., between Atlantic Avenue and State Street, that sent Greco on a trajectory towards developing On Prospect Park.

“From my work in loft conversions, I learned that there are some customers who need their apartment to fit their lifestyle,” said Greco over a cup of coffee in his Remsen Street office. “So I would do these lofts, which would be 25 × 90, but the first 25 feet would be the living and dining area. And that’s where they wanted to put their money.

“The rest of the apartment, they would wall off with filing cabinets or screens or milk crates. But they wanted the front area to be nice and comfortable. The bedrooms could be dark and tiny as long as they had that big, nice open space up front. That was the theme.”

Greco brought that approach to 322 Hicks St. — building a “new loft” from the ground up. Big spaces up front; bedrooms not so much.

That was truly a risk.

“This was five, six years ago,” Greco said. “We had six units and we were asking a million apiece. It was $1,000 a square foot, which was unheard of. We were petrified. But they sold in a week. It blew everyone away.”

Meanwhile, Procida had spent his career in the Bronx, building his empire through government-subsidized affordable housing during the 1980s — a time when other master builders were running for cover.

Procida still operates out of an office in the Bronx, the heir to a family business that began with his grandfather, a Sicilian immigrant, in the late 1920s. Procida’s father, Joseph, built the kind of small-scale projects that provide a living, but not a great one. Procida learned from his father how to build things, but he also learned that in order to make real money, you had to be the developer, not the builder.

His firm, he estimates, is now a $500-million business.

His partnership with Greco started in 2000 on Boerum Place on the fringe of Downtown Brooklyn, where they turned an old office building into be@ Boulevard East, their oddly named, reasonably priced, dormitory-style condo.

It was originally meant to be a rental building, but the developers changed plans after seeing that there was a growing number of hip, young and well off Manhattanites who were being priced out of “the city,” but were more than willing to live one or two subway stops into Brooklyn, which didn’t have an “outer-borough” stigma to them.

And as Downtown booms, SDS Procida is racing other developers into the sky around Flatbush Avenue to get its next be@ property, be@Schermerhorn, topped off before several others, including the Oro condo tower at Flatbush Avenue Extension and Gold Street, are finished.

It’s unclear whether be@Schermerhorn, a 246-unit building that is expected to be completed in 2009, will be a condo or a rental. The market will make that decision, Greco said.

But as a development venture, the market has already spoken. At least a dozen such residential towers are rising in the heart of Downtown Brooklyn. The area between Fulton and Tillary streets was once imagined by city planners to become the heart of a great business district. Instead, it is becoming the bedroom community for existing business districts in Manhattan — a result of demand for more housing than office space.

“People, younger people, are moving to Brooklyn in ways that they never did decades ago,” Greco said. “Even during the period when young Wall Streeters were staying in the city rather than moving to the suburbs, they sniffed at Brooklyn.

“But now, everyone knows someone in Brooklyn, so they realize it’s not so foreign,” he added.

At be@Schermerhorn, just as it was at be@BoulevardEast, that means scores of young urban professionals, possibly backed by down payments from their parents.

At On Prospect Park, the prices are certainly attracting Brooklynites who want to trade up (or down, in the case of brownstone-owning empty nesters), but the trick is to get those Manhattanites.

It’s no wonder that the On Prospect Park sales office is in trendy Tribeca, not in staid, suburban Park Slope.

“We put the sales office in Manhattan because we really couldn’t find an appropriate place in Brooklyn that would really show off the building,” said Cheryl Nielsen-Saaf, the Corcoran Group vice president who is handling sales at On Prospect Park.

“So far, yes, we have seen more buyers from Brooklyn, but there has been and will continue to be a strong contingent of Manhattanites interested in this building. These units are half the price of those in the Meier buildings [on West Street] in Manhattan …”

“This location makes it the AOL Time-Warner building of Brooklyn. No one will be able to duplicate this ever again.”

©2008 The Brooklyn Paper