The Real Deal New York

These five NYC rental buildings had the highest 2016 tax assessments

Spitzer Enterprises to pay $39K per unit in taxes for 800 Fifth Avenue this year

June 02, 2016 08:30AM
By Ariel Stulberg

800 Madison Avenue 1930 Broadway 350 East 79th Street

800 Fifth Avenue 1930 Broadway 350 East 79th Street

Even New York’s top multifamily landlords have to reckon with the taxman, and some more than others.

With April 15 safely in the rear view, The Real Deal dug through the city tax assessment data in search of the rental properties whose owners face the largest per-unit tax bills in 2016.

All five of the highest-taxed properties are found in Upper Manhattan, with all but one directly abutting Central Park. All have average rents around at least $10,000 per month, according to StreetEasy. They’re also largely newer properties, built in the last 20 years.

For this analysis, TRD only considered buildings with 100 or more units, to reduce the impact of commercial incomes on the properties’ overall assessments.

“The main factors that go into assessments are geographic area, the age and condition of the building and its expense ratio,” said real estate tax attorney Joel Marcus of Marcus & Pollack LLP.

Buildings with very high expenses generally receive lower assessments, as do buildings with significant vacancies. Assessors must defend their assessments, Marcus said, and are, by nature, averse to extremes, which can sometimes benefit the owners of the highest-end properties.

800 Fifth Avenue, Upper East Side
Total Units: 229
Estimated 2016 tax owed: $38,889 per unit

It’s odd serendipity that the former home of a 19th Century oil baron would one day become one of the highest-taxed properties in the city. The mansion at 800 Fifth Avenue – once owned by Standard Oil treasurer Jabez Bostwick, and later, by a Rockefeller – sat vacant for more than 50 years until Bernard Spitzer demolished it and built a luxury rental tower at the address in the late 1970s.

The building’s 208 apartments lease for an average of $10,500 a month, according to StreetEasy, with some renters paying as much as $34,500 a month. The 33-story, 354,000-square-foot tower, still owned by Spitzer Enterprises, also contains several medical suites that bring in additional revenue.

The Grand Tier, 1930 Broadway, Lincoln Square
Total Units: 232
Estimated 2016 tax owed: $33,184 per unit

White-glove developer Glenwood Management built and still owns this 30-story, 460,000-square-foot West Side luxury tower, located a block from Lincoln Center, completed in 2002.

Rents at the Costas Kondylis-designed building’s 229 residential average about $9,100 per month and hit highs of $17,000 a month, according to StreetEasy. The building’s six ground floor commercial units are occupied by big-name retail brands, such as Brooks Brothers, Lululemon and Bed Bath & Beyond. Residential brokerage Brown Harris Stevens maintains an office there as well.

The property benefited from an $11.4 million tax abatement in 2016.

247 West 87th Street

247 West 87th Street

The Lucerne, 350 East 79th Street, Upper East Side
Total units: 236
Estimated 2016 tax owed:: $29,914 per unit

The second property on the list developed and owned by Leonard Litwin’s Glenwood Management, the 44-story, 365,000-square-foot Lucerne in Yorkville offers units copious 4- and 5-bedroom apartments for rent as for as much as $30,000 a month, though the average rental rate sits at $9,300 per month according to StreetEasy. The tower, finished in 1989, also has four retail spaces, just one of which is currently occupied, according to CoStar, by grocer Agata & Valentina.

The Montana, 247 West 87th Street, Upper West Side
Total units: 162
Estimated 2016 tax owed:: $29,090 per unit

Real estate investor Irving Goldman bought the property that would become the 26-story, 252,000-square-foot Montana back in 1981, according to public records. The building, completed in 1984 and converted in 2002 is now owned by his son Lloyd Goldman’s firm, BLDG Management.

The property’s 156 residential units rent for an average of about 6,300 per month. A 2,000-square-foot 4-bedroom there rented for $16,000 per month back in May, according to StreetEasy. The building also has six commercial units, leased to tenants including Bank of America, CityMD and Starbucks.

945 Fifth Avenue

945 Fifth Avenue

945 Fifth Avenue, Upper East Side
Total units: 110
Estimated 2016 tax owed:: $23,125 per unit

This Emery Roth & Sons-designed 19-story, 189,000-square-foot luxury rental building, described by its creators as a “straightforward composition rendered in beige brick above a two-story limestone base,” was completed back in 1949. Rudin Management purchased it in 1999, according to public records.

The Central Park-facing property has 107 residential units which rent for about $10,300 on average, according to StreetEasy. It also has 3 office units which together comprise about 5,000 feet of space.

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