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Seventy percent of the residential condominiums in the luxurious Sweeney Building in Dumbo, Brooklyn, have been sold, Two Trees Management recently announced. Of those homes, only one of the six rooftop cabanas remained on the market, according to executive sales director Toby Klein. Since completion in April, 40 families have moved into the building.

The Sweeney Building, located at 30 Main Street in DUMBO (the 24/7 landmark waterfront district named for its location “Down Under the Manhattan Bridge Overpass”), is the first opportunity to own newly converted luxury loft apartments in the neighborhood in five years.

The twelve-story turn of the century factory building has eighty-seven finished lofts.

“The private rooftop cabanas, known as the ‘tar beach cabanas,’ are a truly unique feature of the buildings,” said David Walentas, the developer of The Sweeney Building. Just one of the individual cabanas — a 500 SF rooftop space with running water and electricity –remains available for sale at $175,000. Views from many of the lofts and all of the rooftop cabanas overlook the five boroughs of New York City and the major waterways, including New York Harbor, the East and Hudson Rivers and both the Manhattan and Brooklyn bridges.

Only one of the penthouses a 2,299 SF loft with an interior staircase leading to a private cabana with an additional 1,128 SF of outdoor’ private space and panoramic views, is still for sale. “Our price for this unit is $1.720 million,” said Klein. “There are 27 other lofts at various price ranges still available. Sales are very strong and all units have been sold’ for our asking price. Buyers love the large loft spaces and luxurious finishes.”

Amenities offered include 11-ft. ceilings, oversized windows, and kitchens outfitted with custom shaker style wood cabinets with smoked glass door pantries, marble and brushed stainless steel countertops and high-end stainless steel appliances from Sub-Zero, Thermador, Viking, Bosch, Broan and Franke. Master bathrooms feature mosaic marble tile floors, extra large whirlpool tubs and double sink marble vanity tops. Fully outfitted laundry rooms are found in all of the units.

The location of The Sweeney Building in exhilarating DUMBO is part of the building’s appeal. Art galleries and restaurants abound on the charming cobblestone streets and Jacques Tones, the world-famous chocolatier, both makes and sells his chocolates from his DUMBO storefront.

Two Trees Management Co. LLC, a Brooklyn developer, owns most of the Brooklyn neighborhood, of DUMBO

Fleet Real Estate Finance Group, a unit of Fleet National Bank, announced it has arranged $42.7 million in financing for Strivers Gardens Realty, LLC, an entity controlled by Bernard and Robert Friedman.

The funds will support the construction of Strivers Gardens, a residential condominium building located on Frederick Douglas Boulevard between West 134th and 135th Streets in Central Harlem, sponsored by The Greater Harlem Chamber of Commerce. Fannie Mae is participating in Fleet’s construction loan.

Designed by Davis Brody Bond, LLC and to be constructed by B RF Construction Corporation, the building will feature 169 distinctive condominiums, 37,000 SF o f retail space, as well as underground parking.

Construction is slated to commence shortly with the first units expected to be ready for occupancy by fall 2004. The project carries a total development cost of $67 million.

Strivers Gardens is being developed under the Alliance for Neighborhood Commerce Home Ownership Revitalization (ANCHOR) program, which is administered jointly by the New York City Department of Housing Preservation and Development (HPD) and the New York City Housing Partnership.

ANCHOR promotes the development of mixed-use projects in low- and moderate-income neighborhoods. In compliance with HUD mandates, 75% of the units in Strivers Gardens have been earmarked for households with income under $110,000. Additional funding for this development includes various subsidies from HPD, the New York City Housing Development Corporation (HDC), the Upper Manhattan Empowerment Zone, and United States Department of Housing and Urban Development (HUD) and the Empire State Development Corporation.

“Fleet is proud to serve as the lead arranger of financing for this development which will result in quality housing for Central Harlem residents,” said Philip Grossman, executive vice president and market manager, community real Estate Finance at Fleet.

Strivers Gardens represents the third ANCHOR project in Harlem to date and Fleet has played a key role in each, including 1400 on 5th and The Renaissance at 116th and Lenox.

In what is one of the most uniquely designed residential real estate projects in Westchester, Wilder Baiter Partners broke ground on a 25-acre tract in Mount Kisco and Bedford that will be home to both seniors seeking affordable apartments as well as more affluent individuals looking for luxury single family homes.

When completed in 2005, the project off Routes 117 and 172 will comprise 90 affordable senior condominium apartments in three elevator buildings on the southern end of the site, and 34 semi-attached single family homes starting in the high $500,000s on the northern end of the site.

The senior housing component is to be called the Woodcrest Village Condominiums; the luxury homes will be called Glassbury Court.

Of the 90 senior condominiums, 66 will be priced and affordable to seniors whose household income does not exceed 80% of the Westchester County Area Median Income–approximately $58,000. These homes will sell for $170,000 to $210,000.

Although the balance of 24 will be available for those with income that exceeds the county’s standards, they will be priced significantly below market at approximately $250,000.

Seven of the 66 affordable condominiums will be allocated with first preference to Bedford seniors. The balance of the units will be allocated and have first preference to Mount Kisco seniors.

In the center of the development there will be an 8-acre open space preservation area to be managed by the Westchester Land Trust.

Unlike many other affordable senior housing communities, Woodcrest is receiving no government funding. The entire $45 million project is 100% privately funded, according to William Baiter, a principal of the Elmsford-based development company.

Construction on both the affordable and upscale sections will progress simultaneously. The architect is Westchester-based Warshauer Mellusi Warshauer, P.C., WBP’s construction affiliate, Griffon Associates, is the construction manager.

The popularity of condominiums continues to surge, and conditions in the rental apartment market are finally showing signs of improvement, according to the National Association of Home Builders’ Multifamily Market Index, a quarterly gauge of multifamily market activity and builder confidence.

“People across the country are realizing that condos can be an ideal choice for people who want to enjoy the financial advantages of homeownership while maintaining the amenity-rich, low-maintenance apartment lifestyle,” said NAHB President Bobby Rayburn.

“We expect that the demand for condos will continue to rise, especially in urban areas, and particularly while excellent financing opportunities exist.”

The for-sale component of the MMI climbed to 59.5, up six points from the previous quarter and up eight points from one year ago. Multifamily builders also expressed confidence that the demand for condos would continue-the index gauging expected for-sale starts over the next six months jumped to 62.0.

The MMI is based on a survey of multifamily developers, owners and managers, whose answers to a series of questions are assigned numerical values in order to calculate separate indices that track both supply and demand. An index value over 50 indicates that more respondents view market conditions as good rather than poor.

JULIE Cline was working as a private art dealer in Santa Barbara in the early 1990s when she discovered her true calling.

Luxury hotel developer Kim Richards had just announced plans to build a Four Seasons hotel in Hawaii, where Cline grew up. Though she didn’t know Richards, Cline envisioned creating an art collection for the Four Season Hualalai Resort that would showcase fine art from Hawaii’s golden age in the 1920s and 1930s.

All she had to do was convince Richards to hire her as the hotel’s art consultant.

“I started with a plan and kept writing and calling him,” said Cline, “and I was relentless.” She spent two years pursuing Richards, the president and chief executive of Athens Group, a hotel developer based in Phoenix. “Finally, I called on a Friday night at 5:30 p.m. and he picked up the phone.”

The pressure was on: Cline was given just 15 minutes in the firm’s reception area to pitch her concept to eight executives. She came armed with storyboards and photographs of Hawaii’s royal family–and a theme that incorporated fine art into the hotel’s lush surroundings.

“I was able to tell a story that really grabbed them,” she said. That was the origin of Julie Cline Fine Art Services.

Since that first major project in 1994, Cline has had no trouble finding high-end clients for her niche in the art world.

She has developed art collections for the Montage Resort & Spa in Laguna Beach, for Azzurra, a 19-story condominium in Marina del Rey, and for the Californian, a 23-story residential high-rise on Wilshire Boulevard, among others. One of her first corporate clients was Gary Winnick, the former Global Crossing chairman, who paid $400,000 for 330 drawings that Cline had to auction off when Global went bankrupt.

Signature statements

It seems evident today, but 20 years ago the concept of using fine art to add a design element to luxury hotels was counter to the “cookie cutter” approach of building hotels.

“When Ritz-Carlton came to the forefront as a luxury product, they tended to build the same style hotel and often had the same exact art in the interior,” said Richards, who built the Ritz-Carlton at Half Moon Bay. “But that assumption was ultimately rejected. Now the luxury product has evolved into a comprehensive demonstration of the art history and culture of the place where a resort is located.”

Of course, art is so personal it can often lead to conflict. In fact, Richards fired Cline five times in three years–but always hired her back because of her skill and passion.

“Art, like everything else we do, is very authentic, it’s very honest,” he said. “But it doesn’t lend itself to a corporate process.” Creating an art collection that includes hundreds of pieces on a budget can be time-consuming.

Cline typically works on three to four projects over a two-year period. She currently has six projects in various stages of development, all in California.

Key to her work is spending time at private estates, rare book stores and antique shops looking for old drawings and photographs that tell a story about a project. She also has connections with many gallery owners who advise her of upcoming shows. She charges a fee that ranges from 10 percent to 20 percent of the total budget of a project.

Amazing eye

For Colony Capital’s Azzurra condominium project, Cline purchased 150 works from the Venice Beach art scene of the early 1960s. With a $2 million budget, she assembled Dennis Hopper photographs plus art from Andy Warhol and Ed Ruscha.

For the Montage Resort & Spa in Laguna Beach, Cline put together a collection of works from the Plein-Air art movement, with 20 original oils by William Wendt, Edgar Payne and Jean Mannheim.

“She brings an incredible amount of knowledge as far as the art world is concerned,” said designer Jonathan Barnett, of Jonathan Barnett Studio in Beverly Hills. “Most of the time when you finish a job it’s really unfinished unless you have art on the walls. And Julie has an amazing eye.”

Cline credits her schooling at the prestigious Punahou School in Honolulu for instilling a love of art and ability to tell a story. “Living in Hawaii, you see art through storytelling and you become a storyteller,” she said.

But she struggled for years trying to figure out what to do with an art history degree. For a while, Cline raised thoroughbred horses with her first husband. After getting a divorce, she launched her own business as an art advisor but spent three years battling breast cancer while raising a young son.

Though there are hundreds of art consultants nationwide, few have successfully melded art with real estate.

“There are plenty of art consultants who will go to a poster book and simply mass print posters,” she said. “I really want to tell a story. That’s the difference.”

Julie Cline Fine Art Services

The Inn of the Seventh Mountain in Bend, Ore., launched fractional ownership of the resort condominiums. A $1,000 deposit secures a reservation to purchase a residence at the property, starting at a minimum one-sixth fraction. INNspired LLC owns the property, and Fandango Resorts manages it. The inn is undergoing a $20-million renovation project.

That question has plagued many young Angelenos sifting through the pros and cons of buying an entry-level condominium or renting a two-bedroom apartment.

For the most part, retail and wholesale apparel companies have been spared the headache–usually they can only lease space. But what if leasing wasn’t the standard? Would business people do the same calculations and jump at the opportunity to be condominium owners?

A series of new commercial condo projects is testing that theory. Developers of these projects are confident that the skew of the current commercial market–with its ascending rents and short-term leases–will tilt the equation toward the “own” direction, at least in L.A.’s dense Fashion District.

“It is very analogous to the residential side. Some people are more comfortable renting and others want to own their unit,” said Kent Smith, executive director of the Fashion District’s Business Improvement District. Downtown’s Fashion District is where the commercial condo concept has its longest local history–the 300-unit San Pedro Wholesale Mart was built in the mid-1990s and an annex was added a couple years ago–and is where the largest new projects are going. In the vital apparel industry core, these condos give wholesalers a place to display their clothes to buyers for retail stores.

Among the latest developments is the 200-unit Los Angeles Fashion Center or L.A. FACE, slated to open next year on South San Pedro Street, and the 200-unit Stanford Regency Plaza, scheduled for a 2008 launch, on Stanford Avenue and Pico Boulevard. Other smaller commercial condo complexes are cropping up as well.

Alix Chang, operations manager of Khan Development Co. Inc., is responsible for attracting buyers for L.A. FACE’s units and said about 85 percent of them have been sold since they went on the market in 2004. The average price for a 1,200-square-foot space is now $750,000, up from $360,000 two years before and well over the county’s average residential condo price of $415,000.

“The popularity of this sort of a project is very, very high. The price has been doubled, but it is still cheaper than your average (rental) price in downtown,” said Chang. “It is like owning a house. You don’t have to worry about the lease, you pay your mortgage. It is your store, you own the land and the property.”

Depending on the down payment and the size of the property, the L.A. FACE selling price brings estimated monthly bills of around $3,000 to $4,000. Leasing space at comparable locations in the Fashion District starts around $2.50 per square foot and can, at the very best spots, go up to $10 per square foot. Using those figures, monthly rent at a 1,000 square-foot showroom ranges from $2,500 to $10,000, not including tenant improvement costs and other fees.

Niche practice

Sina Kangavari, managing partner of KI Group Inc., the developer of Stanford Regency Plaza, which is costing $30 million to construct, said interest in Stanford Regency is high. He’s already looking for other locations to build commercial condos. At the San Pedro Wholesale Mart, manager Jay Kim said there are now only two vacancies and even those have drawn serious prospects.

Despite the apparent demand for the condos, ownership isn’t widespread for wholesale apparel and retail businesses.

Part of the reason is that most large chains–the Best Buys and Gaps of the world–have historically leased, and properties designed to suit these chains have been arranged that way accordingly. For independent retail businesses, the failure rate is high, and lease terms reflect the chum of stores and restaurants in shopping centers. Buying a condo latches an owner-operator into a business that might not last two months, let alone several years, which raises the issue of a foreclosure that could leave a unit vacant for months or longer.

And even if business takes off, Mark Tarczynski, a senior vice president at CB Richard Ellis Group Inc., said that retailers like the freedom leases offer. They want to make a splash at a hot location, but not be stuck with depressed property if the neighborhood tanks.

“Retail is kind of a moving target,” he said. “Your store location one day could be a huge hit, and then five years later, the market has moved and you got to move somewhere else.”

That’s not as much of an issue in the Fashion District, which has been the heart of L.A.’s apparel industry for decades and still largely caters to wholesalers. But in addition to the inflexibility of ownership, banks have made it difficult to get loans for buying and building commercial condos.

Recalling the initial development of condos in the Fashion District, Cooke Sunoo, director of the Asian Pacific Islander Small Business Program, said banks weren’t keen on providing financing because they couldn’t grasp the concept. That meant that a lot of upfront cash was necessary.

“Somebody who is coming in for a construction loan, if it is for a supermarket or an apartment house, there are certainly formulas they use,” he said. “These things were anomalies.”

This book explains the legal difference between co-op and condo ownerships, the rights and obligations of the respective owners, and financing and insurance issues. The development of the planned community, another form of common interest community, is also explored. The reference also examines conversion, the process by which a rental property becomes a co-op or condominium. A glossary is included, and an appendix provides resource directories, statutes, and checklists. While the table of contents is detailed, there is no subject index. Jasper is a general practice attorney.

People just starting out and those seeking to downsize and reduce homeowner maintenance often opt for condos as less expensive options: before you sign on the dotted line, be aware of the pros and cons through Condominiums The Pros And Cons Of Ownership. From their rules, restrictions and resale/marketability potentials to repairs, damage, and governing board rules, Condominiums: The Pros And Cons Of Ownership covers it all using simple language any potential buyer will readily understand.

Falor Cos. has agreed to buy the 188-room Hilton Checkers hotel in downtown Los Angeles for about $28 million, according to sources briefed on the deal.

Chicago-based Falor owns mostly boutique properties that have been converted into condo hotels, where the rooms are sold to private investors but are rented out when the owner is away.

Falor has similar plans for the Hilton Checkers, located at 535 S. Grand Ave., sources said. Falor officials couldn’t be reached for comment.

Kor Group Inc., which owns the Viceroy in Santa Monica and the Sheraton Gateway LAX, among other properties, is in negotiations with Falor to take the hotel’s management contract from Beverly Hills-based Hilton Hotels Corp.

Lynn Kozlowski, a spokeswoman for Tarsadia Hotels, which owns the property, said the company wouldn’t comment.

Condo hotels have gained in popularity over recent years nationally, though few are operating in Los Angeles County, according to Neale Redington, national partner in charge of the hospitality division at Deloitte & Touche.

“It’s a fairly new concept,” Redington said. “It’s been very popular in New York but it’s just starting to pop up here in Los Angeles.”

At the price Falor is paying, the purchase would break down to about $150,000 per room, far above the $78,000 a room an unidentified investor is paying for the Hyatt Regency Los Angeles.

Political opposition to the sale is unlikely since condo hotels continue to pay city taxes on rented hotel rooms and they usually retain the existing workforce, which is still needed to run the hotel operation.

Typically, the hotel room owner and the property’s management company evenly split revenues derived from renting out the room, Redington said.

“The owner has a way to defray holding costs of the room,” he said. “And the hotel’s developer or manager finds people to use the rooms and generates fees for that service.”

San Fernando Valley Business Journal reporter Shelly Garcia contributed to this column. Staff reporter Andy Fixmer can be reached at (323) 549-5225, ext. 263, or at afixmer@labusinessjournal.com.