According to the Real Deal, Manhattan-based Chetrit Group has purchased the 95,000 sf warehouse at 77 Commercial Street in Greenpoint. The property is one of the northernmost waterfront parcels that were rezoned to residential in the 2005 rezoning, and the potential development on the site could in a big, bigger or biggest development scenario.

It will be interesting to see how this plays out. What is the market for housing at this location, and how much of a market is there? First off, the site is, in the words of the broker on the deal, “‘not the most centrally located’ site in Brooklyn”. This site is basically at the very end of Manhattan Avenue, a long walk from either the bus, subway or ferry. The property does have 220 feet or so of water frontage, and will have great views and (hopefully) a beautiful city park next door. But – that water frontage is all along the mouth of Newtown Creek; a lot of those views are of Queens (and eventually more towers across the creek in Hunters Point South); and, the City has yet to acquire the adjacent property for a park, let alone fund clean up and capital costs. (It’s also worth asking when the developer plans to building – they’ve completed one project in the area, at 175 Kent, but have at least one other large development site, at Union and Metropolitan, that they’ve been sitting on for a few years now.)

The second question is how big will the developer go here? The base zoning – as with all the waterfront parcels rezoned in 2005 – is relatively low, but there is a sizable floor area incentive under inclusionary zoning for a developer to add 20% affordable housing (without any public review). Beyond that, though, there are also a ton of air rights available from the adjacent parcel at 65 Commercial Street (300,000 sf, according to the Real Deal). Those air rights come with strings attached – in addition to a full ULURP review, the purchasers are supposed to build an additional 200 units of affordable housing (15% of the new affordable housing committed to by the city). And the rights are supposed generate at least $12 million (in 2005 dollars) to create a $2 million “Greenpoint Williamsburg Tenant Legal Fund” as well as provide $10 million to help offset costs associated with creating inclusionary housing on other waterfront properties.

Which raises a third question (largely related to the first one), is there even a market for these air rights? Either with this developer, or the developer of the other adjacent parcel at 37 Commercial.