Developers eye institutional buildings to convert to luxury units

As demand for luxury apartments in Manhattan surges, developers are often converting large institutional buildings to just a few high-end units, the New York Times reported.

Mick Walsdorf, a partner at Flank, a design and development company, said that when the company began selling condos at 385 West 12th Street, many buyers were interested in buying two units and combining them. So with their more recent building, at 607 Hudson Street in the West Village, where they converted a nursing home to luxury units, they stuck with large floor plans, even after the recession seemed to indicate that the market was weak. 

Some housing advocates are unhappy about the trend toward converting large buildings to just a few luxury apartments.

The city needs to enact legislation “so that denser housing, particularly for singles, has a fighting chance in the market,” said Jerilyn Perine, the executive director of the Citizens Housing and Planning Council, an advocacy group. The luxury market has benefits, but the needs of others must be considered, she said. “We need their taxes and spending power — but the loss of density is tragic, especially where mass transit access is so great.”

Regardless of what regulations can be enacted, the fact is, the Times said, that developers will always prefer to deal with ten high-end buyers as opposed to less credit-worthy buyers. [NYT]