New York City Real Estate News

Record NYC real estate deal now on the rocks

2009-11-04T15:53:00.000+02:00

It was the most expensive real estate deal in U.S. history. Now it's poised to become one of the biggest flops.

At the height of the real estate bubble in 2006, an investment group led by New York City real estate firm Tishman Speyer Properties and BlackRock Realty Advisors paid $5.4 billion for a pair of gigantic Manhattan apartment complexes known as Stuyvesant Town and Peter Cooper Village.

The price seemed outrageous to many, but the company believed it had a winning strategy: It would aggressively convert thousands of rent-regulated apartments occupied by middle-class families into luxury units that would fetch top dollar.

State lost $250 million on NYC real estate deal

2009-09-06T08:29:00.000+03:00

Florida lost $250 million on a 2007 investment in a Manhattan apartment building, the head of the State Board of Administration told the panel overseeing the board this morning.

Peter Cooper Village in NYC is part of the state’s $99.6 billion portfolio that makes up the state’s pension plan.

The state invested $250 million in the apartment complex, where monthly rents range from $2,625 to $8,333, according to the development’s website.

Less than two years later, the value of the investment is zero, Williams told Gov. Charlie Crist, CFO Alex Sink and AG Bill McCollum, who oversee the SBA.

Manhattan apartment rents down as much as 18% in second quarter

2009-08-06T01:53:00.001+03:00

Tenants are pressing hard for rent discounts in the troubled Manhattan apartment market and they are getting them, said Jonathan Miller, CEO of Miller Samuel. Rents have dropped as much as 18% in the second quarter, compared with the same period a year earlier, he said. "Unemployment has had a much more immediate impact on the rental market than the purchase market," Miller said. Bloomberg (07/09) ClipSyndicate (07/09)

Rich Russians Returning to U.S. Property Lured by Lower Prices

2009-07-15T10:44:00.000+03:00

July 15 (Bloomberg) -- Russian millionaires are returning to the U.S. property market, lured by distressed sales and the ruble’s rise against the dollar, lawyer Edward Mermelstein said.

“The way many look at the U.S. right now is that it’s a bargain,” said Mermelstein, who has arranged about 300 real estate deals for buyers from the former Soviet Union since 2007.

Mermelstein, 41, closed two purchases and bid for 20 more residential and commercial properties in New York and Miami for Russian and central Asia clients in the past three months, he said. That compares with no deals or offers in January, he said.

Manhattan taking office rents off 40% in 2Q

2009-06-29T22:26:00.000+03:00

Manhattan office taking rents have fallen by as much as 40 percent from the second quarter of 2008 to the same period in 2009, commercial real estate firm FirstService Williams says in a new report issued today.

While the survey showed average asking rents in Manhattan were down 26 percent quarter-over-quarter, to $58.52 per square foot from $79.39 per square foot, the taking rent fell even more.

"Our measures of taking rents indicate that the average may be down in the range of 35 percent to 40 percent over nearly the same time period," the report says.

The Plaza Stirs

2009-06-20T17:15:00.000+03:00

FEW developments rode the wave of high prices in the Manhattan residential real estate the way the 181 condominium apartments at the Plaza Hotel did, and few have chilled as much in the downturn.

As it happened, the financial panic on Wall Street last September came just as the Plaza, the city’s most expensive condominium conversion ever, per square foot, was hit by a wave of bad publicity.

There were complaints that the finishes and details did not live up to the building’s luxurious image. A lawsuit by a Russian billionaire who signed up for a $53.5 million penthouse alleged “bait and switch” tactics. The suit and a countersuit by the Plaza were later settled.

Big Deal The Undeterred

2009-06-14T17:23:00.000+03:00

THERE are many condominium owners and residential brokers around who remember the downturn in the 1980s, when the only work for brokers seemed to be helping banks with their inventories of unsold apartments. And in the last few months, after sales had fallen off a cliff once more, a handful of weakened small firms closed or were absorbed by larger firms.

But not everyone remembers those bad times, and two young brokerage firms, one specializing in new developments in Brooklyn and the other on Manhattan rentals and resales, have merged in the last few weeks, hoping to use the real estate recession to take on their older, larger and more experienced rivals. Two of the principals are only 32.

Find a Hamptons rental or share

2009-05-22T19:29:00.000+03:00

Looking for a Hamptons rental or share for the summer? This Amagansett beach cottage is still available.

Sales Suffer in a Wealthy ZIP Code

2009-05-17T15:01:00.000+03:00

Despite price cuts and a role in a reality series, Victoria Gotti’s estate has gone into foreclosure.

A SPACIOUS four-bedroom three-and-a-half-bath split ranch with an in-ground gunite pool and a cabana on two and a half acres with backyard to die for: Billee and Irving Spodek’s house went on the market last May for $1.975 million, and they accepted an offer on it within three months. But in October, just days before the closing, the stock market tanked, the bank withdrew its mortgage commitment and the deal fell through.

They quickly relisted the property, but to no avail. “I barely showed the house all winter,” said Ms. Spodek, an agent for Coldwell Banker in East Hills, who had planned to downsize.

It's Like EBay For Manhattan Real Estate

2009-05-11T01:22:00.000+03:00

The website shows two properties on the front page, one with "Original Price" of $35,000,000 and "Starting Bid" of $15,000,000. It's a townhouse at 11 East 74th Street, so right off Fifth Avenue. The other originally at $1,500,000 and starting bid $1,300,000, is a 3.5 bedroom condo at 325 Fifth Avenue, which is much further downtown.

Obviously, in the Manhattan real estate market, there are contingencies on the purchase, especially for co-ops, where those sticky co-op boards have the last say on every sale. These first properties on the site are all condos. Some sellers want mortgage contingencies as well. Bid on the City charges you a 3 percent commission for the buyer and the seller, equaling 6 percent.

Manhattan real estate hits auction block

2009-05-05T16:49:00.000+03:00

BidOnTheCity showroom

BidOnTheCity.com aims to stimulate Manhattan real estate sales with a high-tech system for global online auctions that features a 30-day marketing timeline and a 30-minute bidding window.

Albert Feinstein and Vlad Sapozhnikov, executives for New York Business Group, a real estate brokerage firm, contracted with PropertyShark.com, a real estate data company, to build the bidding engine for the new company.

The Opportunist’s Guide to Real Estate

2009-04-30T11:15:00.000+03:00

For almost as long as Patinella and Evageliou could remember, apartment prices in New York had only moved in one direction: upward and out of their reach. “Long ago, it had crossed past the point at which any of it was connected to reality, as far as I was concerned,” Evageliou said one recent Saturday morning, as he and his wife reflected on the sudden, nerve-racking, and tantalizing possibility of turnabout. Over the course of the last year, amid terrifying economic indicators, the couple has been scouring sale listings and tromping through open houses all over the city. As real-estate disasters mount around them, casting shadows across a thicket of glass towers full of empty million-dollar condos, Patinella and Evageliou—like many New Yorkers—see a redemptive glimmer of justice, and just maybe a buying opportunity.

It’s easy to imagine why. Home values are dropping everywhere, not just in quintessential bubble markets like Las Vegas and Phoenix, but in sociologically similar locales like San Francisco, where prices have fallen by a third over the last year, according to the Case-Shiller index. In New York, the plunge hasn’t happened yet; instead, the market has ground to a halt. Many sellers have dropped their asking prices to levels not seen for a few years, but the reductions can’t keep up with the savings expectations of would-be buyers.

Caisse takes possession of New York office tower

2009-04-23T20:40:00.000+03:00

Canada's largest pension manager has added a 40-storey New York office building to its real estate holdings, seizing the property following a foreclosure process.

Caisse de dépôt et placement du Québec, through mortgage subsidiary Otera Capital, plans to hold on to the recently renovated building in the heart of the Rockefeller Plaza district until the real estate market improves.

New York developer Harry Macklowe defaulted in January on a $130-million (U.S.) mezzanine loan held by Otera, one of Canada's five main commercial mortgage lenders. Mezzanine subordinate loans are secured by shares of the company that owns the building.

Mr. Macklowe bought 1330 Avenue of the Americas, or Sixth Avenue, for $498-million in December, 2006. He had a $240-million senior mortgage from Deutsche Bank AG and the mezzanine loan.

Helmsley Estate: $136M To Charity, $1M To Dogs

2009-04-22T13:54:00.000+03:00

Helmsley's estate announced its first round of charitable grants on Tuesday. The largest, $40 million, goes to New York-Presbyterian Hospital/Weill Cornell Medical Center. The majority goes to New York City hospitals and other health care systems across the country.

Helmsley's estate distributed $1 million to 10 animal rights groups, including $100,000 to the ASPCA.

Animal rights groups rejoiced last year at reports that Helmsley who died in 2007 at age 87 wanted her multibillion-dollar fortune to go exclusively to dog-related charities. A court ruled in February that the trustees had sole authority to decide which charities could benefit from her estate.

Madonna buys $40m New York townhouse

2009-04-18T22:10:00.001+03:00

The singer will pay $40m (£27m) for the 26-room mansion on East 81st Street – about $5m less than the original asking price – according to the New York Post. Madonna is "trying to recreate London in New York City", according to a source close to the singer, and she was attracted to the home's Georgian aesthetic.

The double-wide mansion has 13 bedrooms, 14 bathrooms and nine fireplaces, not to mention a lift, a wine cellar and 3,000 sq ft (279 sq metres) of garden. But there's at least one problem, according to the Post – people inside the house can feel the rumbling subway train underneath.

Madonna plans extensive renovations, including security upgrades, before moving in.

The Brooklyn real-estate bust continues

2009-04-17T21:39:00.000+03:00

Brooklyn is for sale — but nobody is buying.

The collapsing economy is being blamed for a 35-percent drop in the number of properties sold in the borough’s once-booming housing market in the first quarter of this year compared to the last part of 2008.

Worse, the first quarter of 2009 is off 57 percent compared to the first quarter of 2008.

The bad news — contained in a new report from the real-estate consulting firm Miller Samuel, which conducted the study for the Prudential Douglas Elliman real-estate firm — follows a trend that started last year, when the economy imploded, mostly because of a housing market bust.

Manhattan Real Estate Plummets - Bloomberg

2009-04-15T18:25:00.000+03:00

Manhattan has become a buyers’ property market

2009-04-13T20:12:00.000+03:00

In the fourth quarter of 2008, for example, resale median prices in Manhattan fell 9.5% for condominiums and 5.2% for co-ops compared with the third quarter of 2008, according to real estate website StreetEasy.com.

This quarter, they declined even more, both compared with the prior year's first quarter and sequentially, said Sofia Kim, the website's head of research.

From the market peak between the fourth quarter of 2007 and the first quarter of 2008, listing prices, typically higher than the selling price in a buyers' market, plunged between 10 and 20%.

"I still don't think the market has bottomed out" said Kim, who expects prices to decline at least another 10%. In the first quarter of 2009, the number of Manhattan homes on the market hit 15,460, a 41% increase compared with the first quarter of 2008,

Housing Slump Begins To Hit Manhattan & The Hamptons

2009-04-11T23:38:00.000+03:00

# While sales have picked up a bit in some suffering housing markets in the West, creating a glimmer of hope that home prices nationwide may be approaching a bottom, the Manhattan real estate market has just begun a steep slide. It parallels the decline in New York’s financial services industry, and housing analysts say it may continue long after other markets heal.
# Apartment prices have once more become the talk of the town in Manhattan, but this time the talk is of uncertainty and falling numbers. While brokers say they are seeing more activity lately, especially from first-time buyers taking advantage of lower interest rates, housing analysts are predicting a prolonged slump in prices and sales that could last as long as four or five years.
# In this year’s first quarter, sales of co-ops and condominiums in Manhattan plunged nearly 60 percent from the first quarter of 2008. Average co-op prices fell as much as 24 percent in the same period, according to various market reports released last week.
# Condo prices have held up so far, but only because buyers who went into contract long before the downturn were closing on newly completed condominium buildings. But now few new contracts are being signed on unfinished condominiums, and some buyers have been renegotiating contracts or are trying to back out of them. Co-ops and condos make up 98 percent of the residential properties for sale in Manhattan.

As Some U.S. Markets Level Off, Housing Slump Hits Manhattan

2009-04-10T00:17:00.000+03:00

Apartment prices have once more become the talk of the town in Manhattan, but this time the talk is of uncertainty and falling numbers. While brokers say they are seeing more activity lately, especially from first-time buyers taking advantage of lower interest rates, housing analysts are predicting a prolonged slump in prices and sales that could last as long as four or five years.

In this year’s first quarter, sales of co-ops and condominiums in Manhattan plunged nearly 60 percent from the first quarter of 2008. Average co-op prices fell as much as 24 percent in the same period, according to various market reports released last week.

Condo prices have held up so far, but only because buyers who went into contract long before the downturn were closing on newly completed condominium buildings. But now few new contracts are being signed on unfinished condominiums, and some buyers have been renegotiating contracts or are trying to back out of them. Co-ops and condos make up 98 percent of the residential properties for sale in Manhattan.

Prudential Douglas Elliman Manhattan Real Estate Market Overview For Q1 2009

2009-04-03T12:30:00.000+03:00

The number of sales declined 47.6% to 1,195 units from 2,282 units in the prior year quarter and down the same amount from the prior quarter. The market share for the number of re-sales has been declining over the past year as compared to new development sales. Re-sales accounted for 57.2% of sales this quarter, down from 69.5% in the prior year quarter. As a result of the lower number of sales, inventory levels have increased, but not as rapidly as other periods of lower activity.

There has been limited participation by "casual sellers," owners who place their properties for sale only to test the market, have opted to wait until conditions have improved. Listing inventory reached 10,445 units at the end of the quarter, up 34.3% from 7,778 units in the prior year quarter and up 15% from 9,081 units in the prior quarter. Inventory levels are at their highest in the decade this metric has been tracked. The prior high was set in the third quarter of 2006 when inventory reached 9,573 units.

Sliding Manhattan home prices give sellers shivers

2009-04-01T00:01:00.000+03:00

NEW YORK (Reuters) - Consider apartment 13C at 730 Park Avenue on Manhattan's storied "Silk Stocking" district. It has seven rooms, a fireplace, excellent nearby schools -- and a price that has been cut 46 percent.

The tale of 13C illustrates a role reversal of sorts underway in Manhattan real estate.

Sellers of property have called the shots for years on the 22.7 square mile island that is the financial capital of the United States. But now buyers are having their day, according to the first-quarter reports due from major real estate brokerages on Thursday.

In the fourth quarter of 2008, for example, resale median prices in Manhattan fell 9.5 percent for condominiums and 5.2 percent for co-ops compared with the third quarter of 2008, according to real estate website StreetEasy.com.

One World Trade Center Gains First Tenant

2009-03-29T09:42:00.000+03:00

After three years of negotiations, the Beijing Vantone Industrial Co., Ltd., a Chinese real estate investment company, has officially signed on as the first tenant at One World Trade Center, New York’s tallest and perhaps most important building currently under development.

The Port Authority of New York said Thursday that it signed Vantone to a 190,810-square-foot lease with a 20-year, nine-month term set to commence upon the building’s completion in 2013. The Chinese developer plans to build out the 64th through 69th floors of the 70-story building as a business/cultural space known as the China Center.

The Center will serve as a hub for Chinese companies establishing operations in the United States, as well as U.S. companies seeking to expand into China. Businesses that choose to locate in the China Center will receive assistance in relocation, real estate, finance and investor relations. Chris Ward, executive director for the Port Authority, called the lease a "clear signal that the World Trade Center site will once again be a global capital of commerce."

Whining Rich Person of the Day, NYC Real Estate Edition

2009-03-24T18:54:00.001+02:00

Every time I come across another one of these stories of rich peoples' innate sense of entitlement it riles me a little more. Dr Beitler is obviously smart enough to know what a deposit is -- but somehow he reckons that a nonrefundable deposit should, in fact, be refundable if and when he can't get a 10%-down, no-income-check mortgage any more. What's more, if he doesn't get his deposit back, he thinks it would be a jolly good idea were US taxpayers to club together to give him back his $173,000 (or more than three times median household income in the US). After all, he did suffer "an unfortunate confluence of events", the poor dear.

I do wonder whether Dr Beitler, who has bought and sold property before -- in what was surely a healthy up market -- might be willing, in return for $173,000 from taxpayers, to return to those selfsame taxpayers all of the profit he made on flipping property in the past. After all, the "confluence of events" which caused property prices to rise was no more his doing than the confluence of events which caused property prices to fall. But somehow I doubt he sees it that way.

Lost Bonuses Mean Manhattan Home Prices to Drop Most Since ‘80

2009-03-23T10:16:00.000+02:00

A 50 percent reduction in bonuses would push down prices by about 24 percent from their peak through mid-2010, said Sam Chandan, chief economist at property research firm Real Estate Economics LLC in New York. That would mark the biggest slide since 1980 when appraiser Miller Samuel Inc. started tracking Manhattan prices.

“This will probably be the worst price correction the city has seen,” said Marisa Di Natale, senior economist at Moody’s Economy.com in West Chester, Pennsylvania.

When bonuses climbed 114 percent between 1998 and 2000, Manhattan co-op and condo prices followed, rising 51 percent during those years, data compiled by Miller Samuel show.