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Durst venture pursues subsidized housing.

In the absence of market-rate residential development opportunities, Robert Durst and partners are finding their place in the subsidized housing market.

Gunther Associates, a partnership of Durst and Marstan Development Corporation, a New York-based general contractor/construction manager, is ready to market 18 low-income units they are renovating in the Bedford Stuyvesant section of Brooklyn.

This is the first subsidized housing venture for Durst, a principal in the Durst Organization, one of the major builder/owner/managers of office and residential property in New York.

The $1.9 million Stuyvesant Court project is comprised of four buildings -- 172-174-180-184 Stuyvesant Avenue -- on the block where Spike Lee filmed "Do the Right Thing." Offered for sale as condominiums will be a variety of one-bedroom, two-bedroom, and three-bedrooms. Eight will be duplexes.

"You don't see any market-rate housing going up," said Durst, "and the financing was there."

Gunther Associates purchased the vacant buildings from the city for $1. The New York City Department of Housing Preservation & Development is subsidizing the project in the form of zero-percent interest loan. The loan will "bridge the gap" between the sellout after the renovation and the actual cost of the project. Additional financing is being provided by the Community Preservation Corporation (CPC).

While the Durst Organization was involved in the 70's and 80's with partnerships that did renovations in Brooklyn, Durst said those projects were all market rate.

This is also the first time he has done a project in Bedford Stuyvesant. Durst said the neighborhood has started to turn for the better, a change that was begun by The New York City Partnership. People, however, are still hesitant about living there, Durst said, and that will make marketing tough.

"The biggest problem we have is the neighborhood not the project," he said.

Gunther Associates is looking at more of these projects, Durst said, including one in The Bronx with the New York City Partnership and a similar one in Brooklyn.

"Now that I know how the nuts and bolts of this type of projects works ..." he said, "That was a big part of it."

For now, he said, this is where the activity is. Very few projects are going up today without subsidies, he said. Unless, he said, you could put together a deal like Millennium Partners did with Lincoln Square, the mixed-use, substantially pre-leased, as-of-right project rising on the West Side. Those deals, he said, "are few and far between."

A park to be shared by the buildings will be created by the partnership out of a vacant lot.
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Title Annotation:Gunther Associates, partnership of Durst and Marstan Development Corp., markets low-income housing units
Author:Fitzgerald, Therese
Publication:Real Estate Weekly
Date:Sep 16, 1992
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