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Working out via 'redevelopment.' (F.T. Charney & Co.) (Company Profile)

In this period of non-building, developer Felix Charney has found opportunity in "re-development." He's not dismantling and constructing projects all over again. Rather, at the request of banks' OREO departments, he is picking up where others left off -- completing construction and putting a new marketing spin on the development that often means changing the name.

F.T. Charney & Company, based in Danbury, Connecticut, is essentially a workout firm but Charney prefers the term redevelopment because he believes he breathes new life into stalled projects.

In 1989, he was introduced to a Norwegian bank which had taken possession of Mansfield Landing, a troubled condominium and marina complex in East Haven, Connecticut.

"We finished the project and stabilized the property," Charney recalled. "We re-instated the state and local zoning permits and we got the property in a position in which it could be brought to auction."

Their next assignment came from Connecticut Bank and Trust. The bank had taken deed in lieu of foreclosure on "Dumpling Pond," a 16-unit condominium project in Greenwich that stood unfinished and unsold for two years. Within the community it was dubbed "Dump Pond." Charney convinced the banks to infuse the large amounts of capital needed for marketing and to complete the streetscaping and landscaping.

"This was the first time CBT decided to put money back into a project they had taken back," said Charney.

F.T. Charney finished the landscaping on the project, added other architectural amenities and renamed it Miller's Crossing. On opening day, they took five deposits and the project made a profit, selling out in nine months.

"The five binders that we took in one day were more than the entire town of Greenwich had taken on condos in the prior two quarters," Charney said.

Also in Greenwich, was the troubled 39-unit Swan Court, an asset that had fallen into the hands of the Bank of Boston. Also at Charney's urging, the bank invested the money needed to complete the interiors, exteriors and landscaping.

"They hired me to do to this what I had done at Miller's Crossing," Charney said.

They held the opening house weekend after Labor Day and received 13 deposits on the first day. The entire thing was sold out in six weeks.

For Swan Court and Miller's Crossing, Charney used the same marketing team, led by Julianne Sodokoff and Jim Bechtel, from William Pitt Real Estate of Greenwich. Rather than do auctions, Charney said, they opted for a traditional controlled sales environment. Auctions are not always successful, he said, and then the project would have the stigma of a failed auction. In addition, he said, redevelopment, offers buyers to purchase homes at discounted prices in a comfortable setting and it provides banks the best opportunity to recover the full value of their assets.

In all, the firm has done 12 assignments for banks as either a redeveloper or as a court-appointed receiver of rent or mortgagee in possession property manager.

Changing the name, Charney said, is often a key to repairing the damaged image of these properties.

"They lay fallow so long and they were projects that went sour early," he said. "In residential [real estate] so much of your success depends on perception. And it's not so much the perception of the individuals. It's the perception of the residential brokers.

The marketing campaign, Charney said, focuses on instilling a sense of excitement about the new product.

"We created a sensation that brought about curiosity and those brokers came and looked at us," he said. "And we were able to create a favorable impression."

They also shoot for opening day fever in the community similar to an auction but not an auction. "Let's do some things but let's not put all our eggs in that one-day basket," he said.

Charney said his work is basically an "orchestration" of all the elements of a project. "I come in and look at what someone else has done," he said. "As a person, with good marketing instinct, you'll see things they don't see."

Redevelopment does not work for every property, Charney warns. Some properties, he said, are better off being rented until the market improves.

He said he believes in the projects he takes on. "I traded monthly fee for a piece of the gross revenue," he said. "It's my way of saying |I know I can make this work.'

Local Man

A native of Fairfield County, Charney, since 1983, has built and purchased in excess of 1.2 million square feet of commercial, retail, condominium, and marina properties in Greenwich, Darien, Rowayton, Westport, Southport, Fairfield, Darien, and Georgetown. Many of these projects were historic properties that the firm rezoned and renovated.

In 1982, he began raising funding for the tax shelter syndication market, in oil and gas, through Greenwich Equities, Inc., his wholly-owned NASD broker/dealer firm. By October of the next year, he founded F.T. Charney & Company, Inc. His first development was River Landing, an 8,000-square-foot office building converted from a gas station in Rowayton, Connecticut, along Five Mile River. Charney formed a general partnership with New York investors. He continued to develop throughout the 80's.

"By 1990, I was involved in a little more than $1 million square feet," he said.

The firm formed a management company, Harbor Master, to operate the 500 boat slips in its three marina properties. They later extended the company's services to owners of other marinas.

In 1986, Charney pooled his local know-how with Michael Wachob, also established in the field of commercial real estate, to form a residential real estate firm with branches in New Cannan, Westport and Wilton. When the time to sell a home went from "80 to 280 days", Charney said, they sold two of the branches and kept open the Wilton branch, which continues to be the top 10 in its area.

The firm also branched into aviation after Charney purchased an airplane. "I looked for a place to keep the airplane and I found that hanger space was very dear," he said.

His search led him to buy Connecticut Air, the largest fixed base operator at the Danbury Airport. They renamed it Executive Air and brought annual sales from $500,000 to $2 million last year. With 12 acres and 60,000 square feet of buildings, Executive Air runs the largest flight school, sells fuel and rents hanger space.

Essentially, Charney said, he is a developer and he is looking forward to getting back to doing his own projects.

"That was once something to be proud of ... |Like so many we're unable to find financing. So we are, if you will, developing for banks.' ... The opportunities are phenomenal and I think the smart money will find people like me."
COPYRIGHT 1992 Hagedorn Publication
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Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
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Author:Fitzgerald, Therese
Publication:Real Estate Weekly
Article Type:Company Profile
Date:Mar 18, 1992
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