BACKGROUND
In 2012, Redsky Management had acquired a very large site in the heart of Williamsburg, 241-247 Bedford Avenue. The site’s prime location on Bedford Avenue, directly across from another significant site that was then under construction, made it an ideal project to attract an eclectic mix of retailers and add significant value to Redsky’s large Williamsburg portfolio. After a “beauty contest” in which many brokers were interviewed, Redsky hired the team at Lee, led by Peter Braus, based on their vision for the neighborhood. Not to populate it with chain stores, but to respect the integrity of the neighborhood by pursuing retailers that will complement the area and serve the residents. And at the top of our list was Apple. The challenge was how to communicate all the attributes of the neighborhood to retail tenants who largely were unfamiliar with the area. Plus, virtually every owner and developer in Brooklyn was eagerly chasing Apple, hoping that the brand would choose its project.
DEVELOPMENT
Extensive conversations between the Lee team and Apple’s brokers ensued to impress upon them the numerous assets of this site, knowing that Apple likes architecturally unique locations, as well as ones that are contextual to the neighborhood in which they operate. Our site was a former factory with arched windows and red brick walls. In addition, we knew that Redsky, unlike many other Brooklyn owner/developers would be willing to expend significant capital to make the improvements necessary to get the tenant. Finally, we knew that the young, affluent opinion-leaders living and visiting Williamsburg would be a demographic that Apple would love. The next step was to meet face to face to discuss the project.
A meeting was held at the ICSC conference in Las Vegas between the principal of Redsky, the LEE team and Apple’s broker. At this meeting, we were able to present a compelling case as to why this was the optimal site in Brooklyn for Apple to make a statement. The seeds were sewn at this meeting, and it was determined that there was sufficient interest to proceed with more in-depth discussions of business terms and design.
VALUE CREATED
Almost four years after our initial meeting at ICSC in 2012, Apple is preparing to open its first store in Brooklyn. While shrouded in secrecy, this store has been the focus of tremendous excitement and has received extensive mention in the press, despite our requirement (from the tenant) not to publicize it.
And since Redsky signed the deal long before it became public knowledge, they were able to use this “inside information” to purchase numerous other buildings on Bedford Avenue, knowing that the rents would increase dramatically.
We have now signed deals and are negotiating deals with several excellent tenants (Sweetgreen, Flywheel, By Chloe, Rituals, Supreme, Sephora, etc.). The project is undergoing its first round of refinancing and, when, completely leased, will be one of the most financially successful retail projects undertaken in Williamsburg, and has added billions of dollars in value to retail projects all over the neighborhood.