Along with his father, Joshua, Muss Development principal Jason Muss has been overseeing construction and marketing for the family-owned, boroughs-focused company since 1996. Last week, Mr. Muss, 39, talked about a surge in sales in Brooklyn, predictions for 2011, and the story behind JetBlue, which subleased space in a Muss-owned building in Queens before signing a deal elsewhere.
The Commercial Observer: Muss Development has long focused on the outer boroughs. How has commercial activity fared in recent years?
Mr. Muss: I can only answer from our perspective, but we’ve done a lot of leasing in the last year–a lot of things that had not been leased that are now getting leased. A lot of office space, retail space, apartments being sold. Everything that had sort of been lingering in 2008 and 2009, a lot of it has gotten taken care of.
And there’s still more work to do in 2011, but we’re definitely on the upward slope right now as far as some of these neighborhoods that have not been overbuilt, and never been overbuilt. And now the excess space is being used and taken up.
One example is the Oceana, the 15-building complex in Brighton Beach, Brooklyn, which earlier this month Muss Development completely sold out. Tell me about it.
Well, Oceana is a very unique project. It’s 15 acres on the ocean, with a subway station at the foot of the project. So you have a very unique situation where you can take one train ride to midtown Manhattan while at the same time living with an ocean view and a beach outside your door–that and the fact that there are a lot of upwardly mobile Russian-speaking Americans who live in Brighton Beach who have aspired to new housing for a long time.
Those two factors together have made the project incredibly successful. Even at the height of the recession that we had, we were still moving apartments at Oceana–albeit at a slower pace. But we didn’t have as much inventory that we did in the boom time. We really never stopped-we were always selling there, and we never cut our prices.
It was a unique situation because almost everybody else was dead in the tracks and yet we were still selling.
How long did it take to sell all 865 units?
The actual sales took about seven or eight years to sell 865 units. So we sold about a hundred and change each year. At the height of the market, we were selling about 200 a year, and then it died down at the end because we just didn’t have as much inventory to sell. But we sold all 15 buildings out entirely, and we have one more site left, where we can build approximately 100,000 square feet or so.
When will construction begin?
We don’t know exactly when. We still have to plan it, do the drawings and get the attorney general’s approval before we can even start selling. So I couldn’t tell you, but we’re actually working on it now.
Besides the Brooklyn Marriott in downtown Brooklyn, Muss has been involved in a number of other retail projects along Adams Street. How do you envision that corridor between the hotel and Willoughby Street shaping up over the next several years?
We envision it being what it should be, which is a retail connection between the Metrotech, Fort Greene and Dumbo areas, and Brooklyn Heights and brownstone Brooklyn to the south. There’s all the foot traffic that goes from Metrotech to the subways–the Borough Hall stop and the A, C and F lines on Jay Street. And then you have all the people going into the hotel, almost 700 rooms of people, basically changing over each night.
So if you factor in all walking distance from Dumbo and Brooklyn Heights, that retail is a prime strip, and something we’ve always envisioned as a pedestrian and activity connector.
And the vision has already started because Morton’s Steakhouse is in the base of our hotel expansion, and that’s been a big success. And then on the other side, to the south of 345 Adams Street, Shake Shack has announced that they’re opening. And then we recently announced that we signed Panera Bread in 345 Adams Street. And since those three things have happened, already the area is starting to transform.
When they all start to open, and when we round out the rest of the project, you won’t even recognize the area. It will be a totally different facade, and it’s going to create a lot of interesting sight lines.
Last year, one of the biggest real estate deals in New York was with JetBlue, which threatened to leave the city, until, of course, Brause Realty inked a city-backed deal with the airline to move into the Brewster Building in Long Island City. Why wasn’t Muss able to keep them in one of its buildings?
We’ve been very aggressively marketing the Forest Hills Tower property with Jones Lang LaSalle. We just hired them a few months ago. JetBlue was a major tenant in the building, and they’re leaving in 2012. So we have about 200,000 square feet on the block. It could be up to 250,000, depending on the tenant.
As far as them leaving, I can’t really speak for them, but it was a matter of being able to economize for them. From my perspective, they went a little off the beaten path maybe, but it’s a good building, and I’m sure they’ll be very happy there. But we’re really just looking forward, and we think we’ll be very successful finding a replacement for some or part of the space.
I’m surprised to hear you call Long Island City ‘off the beaten path.’
Well, I shouldn’t say that; I say that just for an office building. It’s just the fact that they’re an airline, and with us they were very close to the airport. I can’t speak to them as to why they left, but we never signed the lease with them. They were a subtenant for Con Edison, so we never really had the direct relationship with them. So we’re not surprised they didn’t stay. I think they viewed it as a temporary location, and we need to find the tenant who’s going to view it as a permanent location.