Brooklyn Magic!

061906 article transfers Brooklyn Magic!Early on the evening of June 13, basketball legend Earvin “Magic” Johnson was standing before a group of about 40 cocktail-sipping real-estate brokers and house-hunters gathered in a 10th-floor office in the Williamsburgh Savings Bank building in downtown Brooklyn.

A stack of Brooklyn Dodgers hats, next to shirts bearing the legend “One Hanson Place” and tied with gold ribbon, were on hand for the guests. “One Hanson Place” is the new name for the building, now that Mr. Johnson and his business partners have begun selling off apartments in the 34-story office building they purchased for $71 million in May 2005. Prices in the 189-unit condominium range from $350,000 to $3.5 million.

To call the Williamsburgh Savings Bank building iconic is hardly to the point. It is possibly the only skyline landmark in the borough, besides the Brooklyn Bridge; a great tower dominating south Brooklyn’s busiest intersection at Atlantic and Flatbush avenues.

It’s largely as a visual point of reference that Brooklynites know the building, unless they happen to frequent one of the many dentists’ offices in the building. (Some, in fact, will remain there.)

But for the most part, the building is being redeveloped into expensive condominiums, one of which Mr. Johnson himself, looking businesslike in a navy blue suit with an orange tie and a color-coordinated dress shirt, told the assembled group he planned to buy.

“I know that I have always been looking for a place to have an office and an apartment,” Mr. Johnson said. “Then I can walk to New Jersey Nets games!”

“Brooklyn Nets!” shouted Brooklyn Borough President Marty Markowitz, who was standing nearby.

“Sorry—Brooklyn Nets,” Mr. Johnson said.

Their reference to the extremely controversial plan to develop a vast swath of acreage a few blocks away, centered upon an arena for the New Jersey Nets basketball team, only served to give an edge to the otherwise smooth proceedings: One Hanson Place was not, itself, without controversies.

A few hours before Mr. Johnson’s presentation, the activist group ACORN sent out a press release announcing their plans to picket the grand-opening party for the building, to be held minutes later downstairs in the grand bank lobby, which ultimately will become a Borders Bookstore.

As guests listened to smooth jazz and ate and drank cocktails in the vast, vaulted stone-and-marble bank lobby, a group of about 30 picketers formed outside, wearing little paper pins depicting skunks, slashed through with a black line.

“Sweetheart deals stink!” they shouted as they picketed. “Housing for the Needy, Not for the Greedy!” And: “Come Down, Magic! Come Down Now!”

The group was angry that there was no plan to include a component of affordable housing in the redeveloped condominiums, which will include Viking appliances and views as far out into the ocean and over the city as far as the eye can see.

Mr. Johnson did not appear to be coming down. But earlier in the evening he did address the growing controversy that had built after his investment group took over one of Brooklyn’s most beloved landmarks and turned it into condominiums well out of the price range of most of the building’s lifelong admirers.

“Every time we go in, we always look to see how we can make affordable housing work,” Mr. Johnson had said. “But I have people that I have to answer to, and in this situation it just didn’t work out.”

The picketing outside was enough to prompt his partner to hold a 45-minute meeting with Bertha Lewis, the head of the New York chapter of ACORN, to talk things out.

“[We] have an ongoing dialogue to address their concerns,” Mr. Johnson’s business partner, Bobby Turner, told a small group of reporters.

But later, Ms. Lewis was less than enthusiastic about the meeting.

“Less than nothing,” she told a reporter from the picket line outside. “That’s what they gave us.”

The group had wanted Mr. Johnson and his partners to guarantee they could transform a nearby parking lot into affordable units for neighborhood people. They didn’t get their guarantee.

Ever since Mr. Johnson and his partners bought the building, politicians, brokers and bloggers have been buzzing over the conversion of Brooklyn’s tallest building.

Built in 1927-9, the Byzantine-inspired Art Deco tower, with its four-face clock and gold dome, has been a treasured landmark to generations of Brooklynites.

And so the massive conversion is not about just getting a bookseller into a former bank; it’s also about bringing affluent buyers to the neighborhood.

Developers routinely attract criticism for not providing affordable housing, but Mr. Johnson and his partners are especially vulnerable. “In addition to meeting its investment objectives,” reads the fund’s mission statement, “the partnership expects to provide and foster economic opportunities for the under-served residents of the urban neighborhoods in which it invests.”

“The Canyon Johnson Urban Fund is the largest private-equity fund solely focused on urban revitalization,” said Mr. Turner. For Mr. Turner, the Williamsburgh Savings Bank building encompassed the “three D’s” needed for a successful project: diversity, density and demand.

“We have a mandate to make money,” said Mr. Turner. “We manage money on behalf of many New Yorkers. But we have committed—when we can—to foster opportunity for the residents in the community that we are investing in.”

“We clearly believe that this is a resegregation of downtown Brooklyn,” said Ms. Lewis. “And not just in terms of race, but in terms of class.”

“Any time you see—as with the Williamsburgh Savings Bank building, or any of these developments—a big huge sign that reads ‘luxury condos,’ that sign is really saying ‘keep out,’” she said.

And Ms. Lewis does not buy the argument that there couldn’t be any affordable units.

“They can say that they cannot crunch the numbers and make it work,” said Ms. Lewis. “You can decide that out of 200 units, you’re going to have 50 [affordable units]. You figure out programs to subsidize those, and you make it work.”

“You make a decision,” said Ms. Lewis. “And once you make that decision that you are going to have an affordable component, you work backwards. You make the investment in affordability.”

“With great respect to ACORN, not every deal can provide affordable housing,” said Mr. Turner. Mr. Turner offered a suggestion for those “being antagonistic and picketing” the building: “Be proactive, rather than reactive.”

Indeed, Mr. Johnson’s investment fund typically provides many affordable-housing units, according to Mr. Turner, but it still has a fiduciary responsibility to its investors—which include the New York City Pension Fund. In the past five years, Mr. Johnson’s fund has provided capital to build about 6,500 residential units. Of those, 85 percent are affordable, according to Mr. Turner.

Development partners the Dermot Company agreed with Mr. Turner’s assessment.

“We spent time to see if we could make the economics work,” said Andrew MacArthur, principal of the Dermot Company. “Economically, it wasn’t viable.”

“I suppose when you are in development in New York City, you expect that you are going to receive some criticism from somebody,” said Mr. MacArthur. “The issue of affordable housing is a very serious issue in New York City. In all of our other projects, we’ve had an affordable component to our projects.”

But not this one.

“They need to understand that there is a crisis in affordable housing,” said City Councilmember Letitia James. “Downtown Brooklyn is becoming very monolithic and resegregated.”

Ms. James also had harsh words for the Borough President, a supporter of the building’s conversion (as well as the Atlantic Yards project).

“Marty Markowitz came out and supported the ACORN plan [for affordable housing],” said Ms. James. “Why would he go out and support a project that doesn’t have affordable housing? Shame on him.”

“I’d love to see affordable housing at that location,” said Mr. Markowitz, who mentioned the parking lot nearby, which the fund also owns, that has been discussed as a possible location for it. “Everyone at Borough Hall is willing to work with the developer if they are willing to make that commitment.”

“The Williamsburgh Bank building will always be Brooklyn’s landmark building,” said Mr. Markowitz. “It will instantly—between its commercial and residential—become a hub of Brooklyn in a new use.”

So who are these wealthier buyers coming to Brooklyn’s new hub, anyway?

“Our demographic is going to be so open,” said Adam Pacelli, a vice president of the Corcoran Group, whose firm is marketing the building. “I think we are going to have as many baby boomers and empty-nesters—maybe more than we are going to have thirtysomethings.”

On June 8, a few days before the launch party, Mr. Pacelli provided an enthusiastic tour though the storied building: from the underground bank vault to the observation deck—which offers sweeping views over the city, and out to New Jersey.

“Basically, the majority of new development tends to have this modern, flashy appeal,” said Mr. Pacelli. “It’s fad-driven. They have to create this urgency and buzz about it, to get people in.”

“Everyone has such an interaction with this building,” said Mr. Pacelli. “Everyone is so curious to see what the new life will be.”

On an overcast Thursday afternoon, workers moved quickly through the 10th floor, preparing a sample unit for the June 13 launch party. Inside the corner apartment the white paint on the doors was still wet; the built-in Viking appliances were not yet installed. The future Corcoran sales office is located on the same floor down the hall. There were still no desks, computers or brokers; however, a striped gray rug was recently installed.

“Oh yeah, look at the rug, dude,” said Mr. Pacelli, heading into the future sales office. “Hot!”

Scanning the new sales office, and gazing over the borough from the large windows, Mr. Pacelli said that after about two years, he’s more than ready to move on to the selling aspect of his job. Soon his tours through the nooks and crannies of the 512-foot-high building—with stops in the former bank president’s office and mechanical room to look at the elevator gears—will be reserved for potential condo buyers. “I love it—don’t get me wrong—but it’s been a long time coming,” he added.

Initially, there will be 132 units released, located on floors nine though 19. Mr. Pacelli emphasized that even the lowest residential units will tower over much of the comparatively low-lying brownstones and retail shops nearby (the future Frank Gehry–designed “Miss Brooklyn” tower notwithstanding). “Where other new developments finish,” he said, “we begin.” By September, Mr. Pacelli expects to launch the higher-priced units that start on the 23rd floor.

And it’s high up above Brooklyn that Mr. Markowitz—the borough’s single greatest cheerleader—desires to live. But he can’t.

“If I was able to afford to live there, I wouldn’t be facing Manhattan, I’d be facing Brooklyn—so I would look over my borough,” said Mr. Markowitz. “In fact, I wouldn’t mind if the developers would consider having an official residence for the Brooklyn Borough President.”

“They didn’t offer,” joked Mr. Markowitz. “And I didn’t ask.”

Stephon to Net Perry Street Condo?

For New York Knicks players, a good way to get over this woeful season could be to treat oneself to something nice—say a $6.95 million apartment in the Richard Meier–designed towers on Perry Street.

Knicks point guard Stephon Marbury recently checked out such a pricey pad, according to a source with knowledge of the listing.

The 3,692-square-foot apartment includes floor-to-ceiling windows, providing superb city and Hudson River views. The full-service building also features a 24-hour doorman, concierge and state-of-the-art fitness room.

The Perry Street towers have been a celebrity outpost ever since they hit the market several years back—attracting notables like Calvin Klein, Martha Stewart and Vincent Gallo. But the building has never been popular with sports superstars.

As of now, there’s no word on whether the Brooklyn native is ready to relocate to the West Village’s glass-and-steel fishbowl. Through a spokesperson, Mr. Marbury declined to comment on his real-estate interests.

Warburg Realty’s senior managing director, Richard Steinberg, and his colleague Sarah Fiszel have the listing.

Art and the Deal

When hedge-fund manager Daniel Loeb’s deal to buy a $45 million penthouse at 15 Central Park West closes, he’ll best Rupert Murdoch’s record-setting $44 million purchase at 834 Fifth Avenue.

But the deal left him with the Bank Street townhouse he’d purchased only six months earlier for $11.2 million. He tried to do something ambitious on Bank Street, too, marketing the West Village house for $18.95 million earlier this year.

He’ll fall far short of the 69 percent markup he initially hoped for: The 44-foot-wide townhouse recently sold for a rather more modest $12 million, according to deed-transfer records.

Back in April 2005, the four-story townhouse—located on a quaint West Village block—seemed ideal for Mr. Loeb, his wife, Margaret Munzer, and their family.

Devoted patrons of the arts, the couple bought the house from fellow art collector John Stewart—not the Daily Show guy, but a collector, who made the house home to a prized art collection including over 30 works by Russian artist Ilya Kabakov

Some renovations were needed, but the townhouse already offered more than 12,000 square feet of living—or exhibition—space.

Soon, Mr. Loeb will have ample room in the 39th-floor perch above Central Park to showcase his contemporary collection. The family’s lavish spread at 15 C.P.W.—which is to be completed next spring—measures over 10,000 square feet. Inside the full-floor apartment, there are eight bedrooms, 10 bathrooms and about 800 square feet of terrace space.

Brokers Paula Del Nunzio and Guida De Carvalhosa, of Brown Harris Stevens, had the Bank Street listing. Ms. Del Nunzio declined to comment. Mr. Loeb did not return calls seeking comment.

Macklowes Move East

Lately, Macklowe Properties has been making headlines with extensive plans for midtown Manhattan: The company is reportedly developing a hotel and condominium on East 53rd Street, and they’re demolishing the Drake Hotel on East 56th Street and building a luxury condominium in its place.

But the Macklowe family apparently has designs on the bucolic Hamptons, too.

Recently, Billy Macklowe, the company president and son of real-estate mogul Harry—purchased a 10.2-acre tract of land in Sagaponack for $8.1 million, according to deed-transfer records.

Unfortunately, Mr. Macklowe is unwilling to discuss how he plans to utilize the Daniels Lane property. Through a spokesperson, the developer declined to comment.