Developer Salmar Properties broke ground last week on a 1.1 million-square-foot gut renovation of the monolithic 2 Federal Plaza building in Brooklyn’s Sunset Park. The 8-story warehouse dates from 1916 and has been vacant since 2000- when it was last occupied by the U.S. Navy. Now, Salmar will convert the building – which boasts some of the largest floor plates in Brooklyn - into a state-of-the-art, Class A industrial center where occupancy will be restricted to light industrial and manufacturing tenants.
Over the summer, the General Services Administration sold the property to the New York City Economic Development Corporation for $9.1 million, which EDC transferred to Salmar for $10 million on the same date. The developer will invest nearly $45 million in connection with the renovation, repairing its facade, roof, windows, and 23 elevator banks, as well as replacing plumbing, HVAC, and electrical systems. It intends to pursue a LEED Silver renovation in connection with the project, which is located between Second and Third Avenues and 30th and 32nd Streets in Sunset Park’s Southwest Brooklyn Industrial Business Zone.
As part of the sale, Salmar agreed to a deed restriction for 30 years limiting the majority of the building – at least 85 percent – to light industrial uses, with the remaining 15 percent available for retail and other uses. Salmar’s purchase was asssisted by the City’s Industrial Development Agency, which approved approximately $37 million in sales and real-estate tax exemptions for the developer, contingent upon the project reaching – and maintaining – 1,300 permanent industrial jobs.