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Brooklyn Heights apartment building, 25 Monroe Place, sold for $43.5 million last month, according to property records. The price is 13% lower than the $50 million Benchmark Real Estate Group paid in 2015 and significantly less than the $70 million it initially hoped to fetch when marketing the deal in 2019. A source close to the transaction attributed the sale price to practicality, as Benchmark was working to sell before a loan maturity in early 2025.

    The buyer, Ben-Josef Group, secured a good price given the constraints. Benchmark declined to comment, while Ben-Josef Group's CEO did not respond to a request for comment. The sale highlights a shrinking bid-ask gap for multifamily sales that favors buyers. Loan maturities are forcing owners to lower their asking prices or face refinancing challenges.

    Interest rates may be headed down, but uncertainty around the Fed's next move clouds the outlook for financing costs. Owners with 10-year multifamily loans coming due face a double whammy: higher interest rates and the fact that they bought at a market peak, making it unlikely to break even or avoid a loss. Benchmark paid $823 per square foot in 2015; free-market Brooklyn deals averaged $555 per square foot in the fourth quarter, according to Ariel Property Advisors.

    By this yardstick, Benchmark's sale price of $716 per square foot is a success. The original asking price of $70 million was likely wishful thinking, as the property was never worth that much, according to the source familiar with the transaction.