Investor Prospectus: Prime Retail Development Opportunity

166 Berry Street, Williamsburg, Brooklyn

Executive Summary

166 Berry Street, Williamsburg Brooklyn NY 11249

166 Berry Street is on a prime Williamsburg retail corner at North 4th Street and Berry Street (the “Property”). The site can be

developed into a 3-story retail space with a terrace and a total of 16,740 BSF*. Asking price is $32,000,000 or $1,912 per BSF.

Given the growth explosion in Williamsburg, the lack of high-end retail space and the foot traffic on this block, there is already

substantial brand interest in the site: Shake Shack, Nike and Zara among others. The neighborhood already boasts a new Whole

Foods complex, a WeWork office sharespace and an Apple Store.

Property Overview (166 Berry)

Block/Lot 2342/23 Lot Area 6,200SF Lot Dimension 62ft X 100ft Zoning/FAR M1-2/R6A/MX-8 Max Buildable Area 16,740SF* Available Air Rights 10,540SF* Current RE Tax $16,800(1)

Projected RE TAX $23,506(1)

Financial (166 Berry) Asking Price $32,000,000 Price/SF $1,912/SF Construction Costs $10,044,000 ($600/SF) Annual Rent 16,740 x $156/SF= $2,611,440 Less: Projected RE Taxes $23,506(1) Less: Expenses $66,960(2) NOI $2,520,974 Cash on Cash Return 6.0%

Proposed Development (166 Berry plus Townhouse)

Building Type Commercial/Retail/Development Gross Building Area 23,490SF*(3) Building Dimension 87ft X 100ft Total Retail Area 17,443SF*(3) Floors 3 plus terrace Elevator yes Entitlements as-of-right, no-landmark School District 14 (*)Approximate – Architect should be consulted

(1)Estimate

(2)Estimated $4/SF

(3)Blended rate of $250/SF Street Level and $100/SF Above

(4)Add townhouse annexed 25x100 lot and 6,750BSF – price upon request

Neighborhood Description

Williamsburg Brooklyn NY 11249

Williamsburg is one of Brooklyn’s most popular and exciting neighborhoods. The L Magazine, a New York City publication, lists Williamsburg as one of the top Most Livable

Neighborhoods in Brooklyn. It is one of Brooklyn’s top dinning, shopping, and nightlife destinations. The hipster hub has a diverse demographic that attracts people from all over

the city. Bedford Avenue is the neighborhood’s main thoroughfare, anchored by the Bedford Mini Mall, and surrounded by shops, bars, and eateries. The ‘Burg, as locals call it,

also offers many seasonal events and activities, including Smorgasburg in East River Park, one of NYC’s best street fairs. Williamsburg also has a thriving music scene and boasts

several local music venues. The neighborhood is known for fantastic beer and cocktail bars, and its dining options. Spanning everything from old-school steakhouse Peter Luger,

to new hip eateries like Reynard, the Williamsburg restaurant scene is one of the best in Brooklyn. Brooklyn Brewery and Brooklyn Bowl are considered two Brooklyn institutions

that are located in Williamsburg. Brooklyn Brewery offers an award-winning roster of year-round, seasonal, and specialty beers. The venue has been such a success, that it just

opening locations in Las Vegas and London, with Chicago on the way. The brewery is open to the public seven days a week for both private and open tours and tastings. Brooklyn

Bowl, located on Wythe Avenue, was labeled as “one of the most incredible places on earth,” by Rolling Stone Magazine. The venue offers premier performances, food by Blue

Ribbon, bars which feature local craft brewed beers, and 16 bowling lanes. The Wythe Avenue corridor is zoned commercial, leaving hotels as the only development option.

With the major success of the Wythe Hotel, three more hotels are underway. The planned hotels will certainly help generate more foot traffic, and lead to more retail options.

The Wythe Hotel sits in a converted waterfront factory that was built in 1901. It has 70-rooms, including four lofts, six event spaces, cinema, the Reynard restaurant, and The

Ides rooftop bar. Parks and Recreation Space There are several parks within the neighborhood that also offer a variety of activities. The three most notable parks are McCarren

Park, East River State Park, and Cooper Park. The 35-acre McCarren Park is centrally located, and has baseball, soccer, and football fields, basketball, bocce handball and tennis

courts, ice skating rinks, playgrounds, running tracks, dog runs, recreation center and a newly renovated Olympic sized pool. The 7-acre East River State Park offers incredible

views of the Manhattan skyline, play areas, picnicking, barbeques, and music concerts. Lastly, Cooper Park, steps away from 81 Olive Street and 29 Orient Avenue, features a

Sunday Farmer’s Market and sports facilities.

Transportation

Williamsburg is just one subway stop away from Manhattan. All of the properties are serviced by local stops on the L train, which provides service in and around Brooklyn as well

as to and from Downtown Manhattan. The neighborhood is also serviced by the J, M, Z and G trains. The East River Ferry makes stops in both North and South Williamsburg; and

provides service to 34th Street and the Wall Street area in Manhattan. The neighborhood is also serviced by express and local MTA buses for local and Manhattan bound service.

By car, Williamsburg is easily accessible from the Brooklyn-Queens Expressway. The Williamsburg Bridge connects the Lower East Side in Manhattan to Williamsburg.

Williamsburg is close to three major metropolitan airports; LaGuardia Airport (approximately 15 minutes by car) located in Queens, NY, John F. Kennedy Airport (approximately

30 minutes by car) located on Long Island, and Newark International Airport (approximately 35 minute drive).

Why Williamsburg

Williamsburg offers the best of both worlds: stable cash flow with enormous future potential upside in both the residential and retail units. The location encompasses one of the

best Brooklyn neighborhood to live and work. In today’s market commercial space of this magnitude and quality are extremely rare.

Potential Buyers

Williamsburg, Brooklyn, NY 11249

Crown Acquisition Ponte Gadea Acadia Realty Trust Waterbridge Capital Xinyuan Real Estate

Vornado Realty Trust Ashkenazy Acquisition Sitt Asset Management RedSky Capital Monian Group

Wharton Properties SL Green Realty Chitrit Group BrooklynBoss Capital Aurora Capital

Thor Equities Aurora Capital

Associates

Alex Adjmi Family Kuafu Properties

Potential Retailers

Williamsburg, Brooklyn, NY 11249

Appendix: Published References

Williamsburg's $40 Million Retail Sites to Add 21,000 Square Feet of Shopping

Racked, LAURA GURFEIN Feb 23, 2015

184-186 Bedford Avenue. Photo: Meshberg Group

It looks like RedSky Capital wants to turn a profit on its Williamsburg investment as quickly as possible. The real estate firm that spent $40 million on two Bedford Avenue addresses late last year will convert both properties to all-retail spaces, The Wall Street Journal reports, and have set rents at $400 per square foot for the ground floor and $125 per square foot on the second level.

"Five years ago, you would decide to do retail on the ground floors and apartments upstairs," Peter Levitan, of the firm that represented RedSky in the transaction for 184-186 Bedford Avenue and 204-206 Bedford Avenue, told the newspaper. "I think there is a lot of pent-up demand from before the recession for retailers to open stores in Williamsburg."

These conversions will bring a total of 21,000 square feet of refurbished retail space to Bedford Avenue, which has higher commercial rents than anywhere else in the borough—elsewhere, the average is $125 per square foot. Driving that price up here are businesses like Whole Foods, J. Crew, and Redsky's other Bedford Avenue project: the Apple store.

Shop Williamsburg

Mainstream brands look for a foothold in Brooklyn’s hippest neighborhood September 01, 2012 The Real Deal, By Jane C. Timm

The corner of Bedford Avenue and North 5th Street in Williamsburg

Now that major retailers like Whole Foods are opening in the area, other mainstream brands are clamoring to get into the hip neighborhood, too. “This year, there has been a new level of acceptance of Williamsburg as a prime spot for business,” said David Leiter of the Williamsburg-based brokerage Leiter Real Estate Group. “Whole Foods was the stamp of approval on the neighborhood as an area retailers needed to be in.” The shift is also due in part to changing demographics in Williamsburg, which has long attracted twentysomething singles. As the city emerges from the downturn, pricey condos and rentals are now filling up with wealthy families, who in turn are attracting high-end retailers. “As more and more families come into the neighborhood, more and more family-oriented and mainstream retailers are coming to meet that demand,” said Timothy King, the managing partner of Brooklyn-based commercial firm CPEX Real Estate Services. Demand on the rise Retail interest in Williamsburg has been spurred by skyrocketing residential prices: According to the brokerage MNS, studios in June were renting for an average of $500 more per month than last year. “The residential side of Williamsburg has really established itself and there’s a stronger density of residents now,” said Ryan Condren, managing director of retail leasing at CPEX. That, in turn, “provides a consistent flow of foot traffic to the mainstream retailers.” According to brokers, the floodgates opened in March, when Midtown Equities and other investors signed a deal to buy 242 Bedford Avenue, where they plan to develop a $40 million, 150,000-square foot complex with a Whole Foods, luxury apartments, a Citibank and a New York Sports Club. That deal has prompted other mainstream retailers to seriously consider Williamsburg, brokers said. Williamsburg Cinema, a new movie theater being built at Driggs Avenue and Grand Streets, will have seven screens and 1,000 stadium seats, giving movie-goers a more mainstream alternative to the artsy, smaller Nitehawk Cinemas, which opened this summer. And sources say clothing behemoth J.Crew is considering taking space at 247 Bedford Avenue, a recently renovated, 35,000-square-foot space with 13 retail storefronts available for rent. The site — which offers some of the largest retail spaces in Williamsburg — started leasing this summer, with asking rents between $185 and $200 per square foot.

Brooklyn’s fast-growing retail strips flirt with records

Rents approach or exceed $200 per square foot in some areas August 22, 2014 The Real Deal, By Tom DiChristopher

Bedford Avenue While the priciest rents in Williamsburg have long been found along Bedford Avenue between Metropolitan Avenue and North 8th Street, retailers are now looking beyond the strip as rents top $200 per square foot in some cases, brokers said. “[Retailers are] starting to look for deals outside of that prime zone where there’s still plenty of visibility, plenty of action, plenty of foot traffic,” said Joshua Singer, head of retail leasing at the Heller Organization. Heller recently marketed 101 Bedford, where Diesel has opened a pop-up store with the option to take out a long-term lease. Located near North 12th Street, it is just north of Bedford’s priciest stretch. Asking rent for the space was $175 per square foot. In Williamsburg, retailers also have options on the neighborhood’s thriving side streets, said Diana Boutross, a broker at Winick Realty who arranged for Starbucks to take 154 North 7th Street, off Bedford Avenue. “It’s a side street market,” said Boutross. “You can get half rent on the side street and open a big, awesome store.” Along the neighborhood’s second-priciest corridor, North 6th Street, Urban Outfitters recently opened a nearly 37,000-square-foot concept store called Space Ninety 8.

Joe Sitt’s Thor pays $36M for Williamsburg development site

Deal with Salvation Army for 180 Bedford Ave. comes to $2,500 per buildable sf The

Real Deal, April 15, 2015 By Konrad Putzier

…These deals, pricey even by Manhattan standards, are driven by Williamsburg’s emergence as a center of

high-end retail. The site purchased by Thor sits at arguably the busiest intersection in Williamsburg and has

over 60 feet of frontage on Bedford Avenue and an additional 60 feet of frontage on North 7th Street. Zoning

permits a building of maximum of 14,400 square feet, meaning the (typically more valuable) retail component

takes up a larger share of the building and pushes up the price per buildable square foot. Sitt described Bedford

Avenue as a “major shopping and dining hub, with strong demand and limited availability of new, high-quality

retail space.”

203 Bedford Avenue Williamsburg, Brooklyn, New York 11211 $12,500,000 - $2,866.97per BSF

Cushman Listings

Listing ID Number 24178

Property Description Cushman & Wakefield has been retained on an exclusive basis to arrange for the sale of 203 Bedford Avenue in the heart of Williamsburg, Brooklyn. This three-story brick townhouse can be repositioned into a mixed-use building by converting the ground floor into retail and building out an extension with the available air rights. A developer can also build a new two-story commercial building (as portrayed by the rendering above), which will offer tenants 4,360 SF of above grade usable space. 203 Bedford Avenue is located ideally between the new Apple Store and Whole Foods and the Bedford Avenue L Train Station.

Overview Building Type: Development/Conversion Sites

Location: Williamsburg, Brooklyn

Buildable Sq. Ft: 4360

Zoning: R6B / C1-4

Taxes: $4,784

Thor files plans for Williamsburg retail conversion

Filing deviates from previously targeted 35K sf on North 6th Street October 19, 2015 The Real Deal, By Rey Mashayekhi

Rendering of 124-136 North 6th Street in Williamsburg (credit: Thor Equities) (inset: Joseph Sitt)

Joseph Sitt’s Thor Equities filed plans Monday for its retail conversion of a site on North 6th Street in Williamsburg, and they’re somewhat different from what was expected. The site, located at 124-136 North 6th Street between Bedford Avenue and Berry Street, will contain a three-story commercial building spanning almost 20,400 square feet, according to a permit application filed with the Department of Buildings. The plans are a considerable departure from those previously expressed by Thor, whose website notes a retail development at the location spanning 35,000 square feet – with 10,000 square feet on each of the ground and lower levels and 7,500 square feet on the second and terrace levels. The filing also indicates retail space on the ground floor only, with warehouse and manufacturing space on the second and third floors. Neither Thor nor Midtown-based Building Studio Architects, the project’s architect of record, could be reached for comment. Thor acquired the assemblage for $21.5 million in August 2014, according to city property records. The site currently holds a pair of one-story commercial buildings housing restaurants, with vacant land between them. In April, The Real Deal reported that Sitt was in contract to purchase another prime Williamsburg retail site at 176-180 Bedford Avenue from RedSky Capital for $36.1 million. That site allows for a total of 7,200 buildable square feet, plus another 7,200 square feet of roof and basement space. Sitt also won’t have far to turn to find friendly faces in Williamsburg. His son, Jack Sitt, picked up a 10,000-square-foot building at 93 North 9th Street earlier this year, with plans to renovate the retail space. Retail rents along Bedford Avenue’s prime shopping strip average $347 per square foot, according to a recent Brooklyn market report by the Real Estate Board of New York.

Shake Shack Might Be Coming to Williamsburg in the Old Puccio Marble Building 10/28/15 Brownstoner, by Barbara Eldredge

NYC burger baron Shake Shack is eyeballing the former Puccio Marble warehouse at 661 Driggs Avenue as a potential Williamsburg outpost, The Real Deal reported. Brownstoner readers may remember the building — which sold in July for a whopping $1,049.32 per square foot. Though other businesses are also considering the site, Shake Shack has yet to expand into Williamsburg and 661 Driggs is well situated in the oh-so-hot vicinity of the future Brooklyn Apple store and Whole Foods. The Puccio family sold 661 Driggs to BrooklynBoss Properties (operating under the name of Brooklyn Rose LLC) for $5,666,376 in late July, after 45 years of operating their marble business there. A Brownstoner reader who wished to remain anonymous tipped us off to the sale, saying it was “for a ridiculous amount of money.”

Records show that 661 Driggs could be expanded to twice the current size — up to 15,500 buildable square feet — and indeed, The Real Deal reports that BrooklynBoss is willing to add an extra floor depending on the tenant’s requirements.

BrooklynBoss Managing Partner Dennis McCormack told TRD that a retail tenant would pay $135 per square foot for the space.

Brooklyn's 10 Most Expensive Streets for Shop Owners REBNY, By SIMONE WILSON October 14, 2015

REBNY researchers say they chose the 15 most expensive commercial corridors (as known to REBNY)

between Greenpoint and Bay Ridge. They then calculated the average asking rent, per square foot, for ground-

floor retail space currently on the market along those corridors.

REBNY says it hopes the report will give “brokers, owners and tenants... a more thorough understanding of the

retail market in these areas.”

The results are pretty fascinating, if not all that surprising: We’ve got cameos from Williamsburg, Downtown

Brooklyn, Cobble Hill, Brooklyn Heights, DUMBO and more Williamsburg.

Here are Brooklyn’s top 10 most expensive streets for shop owners, as known to REBNY.

1. Williamsburg’s Bedford Avenue, between Grand Street and North 12th Street: $347 per square foot.

2. Downtown Brooklyn’s Fulton Mall, between Boerum Place and Flatbush Avenue: $287 per square foot.

3. Williamsburg’s North 6th Street, between Driggs Avenue and Kent Avenue: $208 per square foot.

4. Cobble Hill’s Court Street, between Atlantic Avenue and Carroll Street: $162 per square foot.

5. Williamsburg’s North 4th Street, between Driggs Avenue and Kent Avenue: $153 per square foot.

6. Brooklyn Heights’ Montague Street, between Hicks Street and Cadman Plaza: $150 per square foot.

7. Cobble Hill’s Smith Street, between Atlantic Avenue and Carroll Street: $121 per square foot.

8. Williamsburg’s Grand Street, between Havemayer Street and Kent Avenue: $110 per square foot.

9. DUMBO’s Washington Street, between Front Street, Water Street and Main Street: $107 per square

foot.

10. Prospect Heights’ Flatbush Avenue, between 5th Avenue and Grand Army Plaza: $102 per square

foot.

Runners-up include a couple main drags in Park Slope and Greenpoint, and one in Bay Ridge. If you are

interested in the full REBNY report or have any inquiry about the property please contact us at:

__________________

Carrie C. Chiang Licensed Associate Real Estate Broker The Carrie Chiang Team Manhattan’s No. 1 Ranked Sales Team, Wall Street Journal 2012, 2013, 2014 Corcoran Group Real Estate 660 Madison Avenue New York, NY 10065 d: 212-836-1088 f: 212-821-9152 ccc@corcoran.com

__________________

Spencer Ting Licensed Associate Salesperson The Carrie Chiang Team Manhattan’s No. 1 Ranked Sales Team, Wall Street Journal 2012, 2013, 2014 Corcoran Group Real Estate 660 Madison Avenue New York, NY 10065 m: 917-301-1184 spencervt@msn.com

__________________

David Garland Licensed Associate Salesperson The Carrie Chiang Team Manhattan’s No. 1 Ranked Sales Team, Wall Street Journal 2012, 2013, 2014 Corcoran Group Real Estate 660 Madison Avenue New York, NY 10065 d: 212-893-1429 m: 646-924-5995 dgarland@corcoran.com