Thursday 19 April 2018

New York storeys – the Rise of the Big Apple

Prices are rising in the Big Apple. Photo: Ron Antonelli
Prices are rising in the Big Apple. Photo: Ron Antonelli

Oshrat Carmiel

MANHATTAN developer Bill Rudin hadn't planned to start selling apartments at his Greenwich Village project until the end of this year. He began rethinking that strategy after getting cornered at a cocktail party.

"People came up to me and said, 'We want to buy, we want to buy. When can we buy?'" Rudin said in an interview.

He opened a sales office in October for the Greenwich Lane, a complex under construction at the site of the shuttered St Vincent's Hospital, after an online sign-up list of would-be buyers for the 200 condominiums drew 1,100 names. More than half of the units at the development, still largely a field of dirt and skeletal towers, have sold at prices averaging $3,500(€2,534) a square foot, in line with other projects downtown and a new luxury benchmark for the area.

While Midtown skyscrapers fringing Central Park are setting sales records and attracting international investors, downtown Manhattan's new condos are breaking their own price barriers with a focus on local buyers. From the cobblestone streets of Tribeca to the low-rise landmarks of Greenwich Village, builders are accelerating projects with features and costs that rival high-end offerings farther north.

Contracts signed at newly built properties between 34th Street and the Financial District almost doubled last year to 1,222, according to brokerage firm Corcoran Sunshine Marketing Group.

Buyers agreed to pay an average of $5.7m in the fourth quarter, up 49pc from a year earlier and a new record. The price per square foot of those deals rose 20pc to a high of $2,915.

Downtown buildings accounted for 51pc of Manhattan's new-development sales last year, compared with 35pc in 2012, according to the brokerage. Developers in the area have more than 4,000 units planned for construction or delivery within the next two years.

Projects such as Greenwich Lane, where the cheapest apartment is a one-bedroom for $2m, and Magnum Real Estate Group's planned conversion of a Verizon Communications office building in Tribeca are offering larger units, parking spaces and amenities designed to appeal to both New York City families and empty-nesters considering a move from the suburbs.

"We're doing plenty of two, three, four and five-bedrooms," said Ben Shaoul, president of Magnum. Magnum, which plans to start sales in September, envisions units ranging from 1,200 to 3,500 square feet that emphasize larger living rooms and common spaces.

Apartments at the tower, across from the almost-completed One World Trade Center, are expected to start at $2m, he said.

Plans call for a pool, fitness centre and yoga room, as well as a lounge and wine bar in the building's landmarked marble lobby, where murals on the domed ceiling depict the progress of human communication from carrier pigeons to the telephone.

A block away, the Witkoff Group and partner Fisher Brothers are proposing a condo tower at 101 Murray Street, the site of a former St John's University campus, that would feature large apartments.

The price record for downtown was set in January with the $50.9m purchase of a 5,955-square-foot full-floor penthouse at the Walker Tower in Chelsea.

New condo buildings are the latest step in the evolution of lower Manhattan, which has benefited from government funding in the years after the 9/11 attacks, said Mitchell Moss, a professor of urban policy and planning at New York University.

The development of Hudson River Park and Pier 25 in Tribeca, and improvements in local schools, have made downtown a favourite destination among families with means to stay in the city.

"It used to be that wealth was concentrated on the Upper East Side and now it can be located in Soho, the East Village.

New housing increasingly is being built on sites sold by nonprofit groups seeking to capitalise on soaring real estate values, leading to alarm among some preservationists.

"There's concern that so much of the new development has skewed toward the ultra-high end, especially in some of the cases where it's been replacing social services that serviced a much broader range of people from the neighbourhood," said Andrew Berman, executive director of the Greenwich Village Society for Historic Preservation.

Neighbourhood residents fought the closing of St Vincent's, the only hospital in southwest Manhattan, which treated survivors of the Titanic and the September 11 attacks during its 160-year history.


They argued that Rudin's proposed residential project was out of character for the historic district and sought preservation of some of the original structures at St Vincent's, which shut down in 2010 after filing for bankruptcy.

While construction goes on behind the hospital's brick shell, buyers of Greenwich Lane condos are placing deposits in the off-site sales office, where an interactive computer screen magnifies floor plans. A 4,442-square-foot penthouse that was listed for sale at $29m is among the units under contract, according to real estate website Not on the market yet is a triplex penthouse of more than 5,000 square feet. Its price tag will be more than $30m.

In the southern part of Tribeca, once largely a warren of government office buildings, more than $1bn of sales were completed in the past year at 56 Leonard after the developer, Alexico Group, waited out the financial crisis.

The foundation for the planned 60-storey tower was poured in mid-2008, just before the collapse of Lehman Brothers Holdings Inc Alexico halted deals and construction for more than four years, said Izak Senbahar, the company's president.

Senbahar said: "They needed a larger space, they wanted views, they needed a doorman and a garage."

About 75pc of the buyers were New Yorkers, said Senbahar, who initially assumed much of the interest in the tower would come from overseas.

The surge in downtown demand is pushing up prices for all residences in the area. In Tribeca, the median asking price for new and previously owned homes jumped 25pc in 2013 to $3.55m, the highest in records dating to 2005, data from StreetEasy show.

Numbers like those have emboldened developers including Kevin Maloney, principal at Property Markets Group, which is building a 16-storey high-rise and townhouse project at 10 Sullivan Street in Soho.

Units at the Soho project, which Maloney described as "family-oriented", will start at 2,200 square feet. The four- storey townhouses will have 6,000 square feet and may sell for as much as $20m, he said. (Bloomberg)

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