With the cost of land increasing and assembling of multiple parcels of land more and more difficult, Manhattan skyscrapers on Billionaire’s Row and throughout have continued to go up but are now getting skinnier. Typically, developers will buy a site but then also buy the air rights from neighboring buildings which allows them as of right to go into the stratosphere. Success of buildings like One57 which is home to most expensive sale for a residential apartment at just over $100mm are buoying this trend.
111 west 57th street is one of the newest entrants to this field with a width to height ratio of 1:24 according to engineers for the project. Developers get more more money for helicopter views so this trend figures to continue.
Full story here
The Author- Brian Silvestry , a licensed real estate broker, has been selling residential and commercial real estate since 1999. He has sold in every Manhattan market from Battery Park City to Washington Heights.
by Brian Silvestry
Extell developement, the developer behind the One57 condo on Billionaire’s Row in Manhattan was able to secure financing to go ahead with their newest development on West 57th street. The building is a projected $4 billion sellout. With the market for super luxury slowing in the last couple years, one of the terms of the lenders is to have $500 million in sales by 2020. Central Park Tower will have 179 units and 20 of those units will be asking $60mm or more. The price per square foot will be just north of $7k psf.
The building will have a Nordstrom’s at it’s base and will rise 1550 feet.
Many foreign investors have been purchasing apartments for investments in the last several years in Manhattan. Part of the reason that the latest condo boom saw so many large apartments over 2000 sqft (185m2) be built was to satisfy the thirst of overseas high net worth individuals. Now with the super luxury market in the throes of a buyer market, headlines are being made by sellers who bought only a few short years ago and are selling at a loss. So what went wrong and how can a foreign investor now take advantage?
Take for example 432 Park avenue, the Macklowe developed building between 55th and 56th street with helicopter views of Central and 10′ by 10′ windows. Right now, it is the tallest building in the Western Hemisphere but will be passed next year by other buildings in the Billionaire’s Row corridor. Prices range from $6000 per sqft to over $10,000 per sqft. The old adage in real estate is that you do not want to have the most expensive house in the neighborhood and I think that applies here too. Wouldn’t it make more sense if you had $20 million to invest to buy 3 to 4 smaller apartments or one large an expensive one? Well, if you bought several you would be buying in the sweet spot of the market and at a price point that many people can afford. So when you try to resell you are not searching for the needle in the haystack and also the rent would be at a price that many more can afford. How many clients are there for $55,000 per month rentals and how long does it take to rent one out? However a $12,000 per month has much more potential clients.
According to the listing site, streeteasy, there are 40 monthly rental listings in Manhattan with asking prices between $40,000 and $60,000. Half of those listings have been on the market for more than 4 months. So at the upper echelons, you may wait quite a while to get that super luxury pad rented. On the contrary, betweeen $8,000 to $20,000, the rental market has 978 listings! This is clearly the meat of the market.
So today’s tip in a nutshell is that unless you are getting a very good price, it may makes to buy a few apartments instead of parking a concentrated amount of funds in only one.