As part of our New York coverage this week, HotelHomes.com surveyed some of Manhattan’s top deal-makers and market commentators about the current environment in the luxury real estate sector – and where to get a good deal today on tomorrow’s hot property.
In 4 Words or Less, How Is the Market?
Active in various price segments, neighborhoods and styles of building, the most recent sales of our top brokers clearly point to the key trends driving the New York market.
Scraping the Sky
According to Sofia Song, Vice President of Research at Streeteasy, the development boom of the last decade was typified by star architects driving sky-high sales prices. While this year’s new residential towers also include a laundry list of Pritzker Prize winners like Christian de Portzamparc (designer of One 57) and Herzog & de Meuron (the architects behind 56 Leonard Street), these new properties are better typified by their sheer height. Buyers currently get to select from the 90-story One57, the 60-story 56 Leonard, and 432 Park Avenue, the tallest residential building in the Western hemisphere at 96 stories.
Of course, with height comes views. One57’s Director of Sales Jeannie Woodbrey recently completed a deal for a 3,228 square-foot (300 square meter) home with three bedrooms,10’7” (3.3 meter) ceiling heights and a custom-designed glass curtain wall framing panoramic park, city, and river views. The buyer is domestic and opting for a highly–serviced luxury lifestyle with the convenience of hotel services. Construction at One57 has progressed so that potential buyers can access a spectacular model apartment, and experience the Central Park views first-hand. Woodbrey pointed to a deal she is currently finalizing with a buyer she has been working with for over a year. “Now that the building is nearing completion, I was able to bring them to an apartment that is somewhat complete as well as a spectacular, furnished model,” said Woodbrey. “The buyers were blown away…I didn’t need to say a word.”
Demand for Pied-A-Terres
New York is simply one of the few world cities where global leaders feel they need to own a home. Elizabeth Lorenzo of Stribling recently sold two apartments on the Upper East Side to pied-a-terre buyers, one to an American family and the other to an international businessman. At Baccarat Residences New York, Sales Director Norma Jean Callahan recently completed a high-floor three-bedroom sale to a family with a primary home in the metropolitan area that wanted a second home in the city to be closer to their grown children, “with highly elevated services that the entire family can enjoy when visiting.”
Return of the International Investor
New York has long been known as a relatively stable and attractive global property destination, and foreign investors definitely see the upside in the current market. As an example, Elizabeth Lorenzo’s most recent sale at The Plaza was a 1200 square foot (111 square meter) one-bedroom apartment sold to an international investor for approximately $3 million. At the Residences at the W New York – Downtown, Director of Sales Richard Nassimi recently sold two adjacent apartments to a cash investor from Singapore, several other individual residences with rental tenants in place, and is in negotiations for an entire floor of residences to a foreign fund representing individual unit buyers.
The Great Outdoors
In an apartment-dominated landscape like Manhattan, meaningful outdoor spaces have long been prized. And for a certain segment of the market, they still drive the sale. Downtown, Stribling’s Pamela D’Arc is working on the sale of a Greenwich Village penthouse with walls of glass opening onto extraordinary outdoor space, offering true indoor/outdoor living with lovely open views. In Midtown, Norma Jean Callahan is negotiating on a custom combination home at Baccarat Residences New York for a global traveler looking for the ultimate outdoor entertaining space in the middle of Manhattan. The combined home will feature 3,000 square feet (279 square meters) of terraces with over 4,000 square feet (372 square meters) inside designed by Tony Ingrao.
Prewar Properties Holding Value
New York’s “prewar” apartment buildings – those dating from before World War II – offer some of the city’s classic architectural heritage in long-desirable locations like Park Avenue and Central Park West. Cornelia Zagat Eland, Senior Executive Vice President at Stribling & Associates, recently sold a Park Avenue three-bedroom for “shy of $10 million” because of the building’s prewar feel to a buyer downsizing from a much larger apartment, and is negotiating a sale at The Pierre, one of Manhattan’s greatest prewar hotel-residential properties. On the Upper West Side, Stribling Executive Vice President Pamela D’Arc negotiated the sale of a so-called “Classic 7” (three-bedroom apartment with an additional staff/maid’s room) to a foreign family who preferred the “charm and grandeur” of prewar to the city’s newer condominiums.
The Next Big Thing
Our market makers were divided on the next segment of the city’s property sector poised for rapid price appreciation. Baccarat’s Callahan and One57’s Woodbrey both cited the ability of new luxury developments to meet the needs of demanding global consumers. Stribling’s Lorenzo pointed to townhouses, which offer gardens, terraces, and sometimes swimming pools at attractive valuations while Corcoran’s Nassimi thinks pricing for retail space “will be the next one to ‘explode’.” Meanwhile, Song feels those true New York neighborhoods like TriBeCa and Greenwich Village are great choices (until the international buyers catch on). Others – like Stribing’s D’Arc and Eland – are pointing across the river to prime neighborhoods in Brooklyn, where investment properties and single-family homes can still be purchased well below Manhattan prices.
Whether you are driven by helicopter views from a skyscraper condo or the gracious proportions of a historic prewar apartment, New York’s market is definitely hot. Given the competition from investors, pied-a-terre and primary homebuyers alike, at least one thing is clear – New York’s reputation as a safe place for property investment is not likely to be tarnished any time soon.