The other day I returned to my old neighborhood, the Upper East Side, and was pleasantly surprised to see a new store, only two weeks old, that belonged to the luxury cosmetics and soap company Sabon, its ninth store in Manhattan, at 1276 Lexington Avenue, a few feet south of the subway at 86th Street. he store has three other locations outside Manhattan, including in Garden City, N.Y., and in Chicago and Schaumburg, I.L. Although it looks in the main like most of the other Sabon outlets in the city, to me it is easily the loveliest of all. It is not the rustic feel of the two tones of woods, paler and rougher-hewn at the summit, dark and smooth along the rest of the street-front, that makes it so appealing, nor the sweet smell of lavender and patchouli rising amid the general foetor of this stretch of Lexington Avenue.
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The new addition to John Jay College
on 11th AvenueFrom the October issue: Bigness is back. By “bigness,” I do not mean height — rather, I refer to a kind of hulking squatness, an unapologetic, as-of-right occupancy of a plot of land — without any namby-pamby purchase of “air rights,” or any rising up in a zigguratted setback to heights made possible by the construction of some cynically insufficient, “privately owned public space.”

Two recent and conspicuous examples of this new bigness are the Lucida and the Brompton, which occupy the southeast corners of 86th Street at Lexington and Third Avenues, respectively. These structures hark back to the days before the 1916 legislation that mandated how high a building could rise in New York relative to its footprint.

But an even more striking instance of this upstart subgenre is on the West Side — the addition to John Jay College of Criminal Justice (part of the City University of New York) that has just opened in time for the beginning of the new school year. [more]

Even as the land sales market has improved in Manhattan overall, the number of developers actively trying to put together sites remains just a handful, far fewer than during the boom. One of the city’s leading professionals in the business, Dov Hertz, an executive vice president at Gary Barnett’s Extell Development, spoke with Insights from The Real Deal about the current number of deals he believed are underway in Manhattan, and about the time someone backed out of a deal to sell air rights.

Hertz leads the acquisitions arm of Extell, one of the most prolific residential developers in the city. He has led or had a hand in Extell’s major assemblages, including two projects still under development, the 34-story International Gem Tower at 50 West 47th Street and the 74-story Carnegie57, at 157 West 57th Street, spanning the mid-block between Sixth and Seventh avenues and 57th and 58th streets. He has also put together sites for completed residential towers, including the 110-unit Lucida, at 151 East 85th Street; the Ariel East and West; and the 22-unit 535 West End Avenue.

In addition, Robert Knakal, chairman of investment brokerage Massey Knakal Realty Services, weighs in on how many sites are being assembled now, and where they are located. [more]

From left: 995 Fifth Avenue, 535 West End Avenue, the Lucida and Michele Kleier

Gumley Haft Kleier, the boutique New York City brokerage made nationally famous by HGTV’s “Selling New York” last year, is “very seriously considering opening up a division to represent new developments,” co-president Michele Kleier told the New York Times. The television starlet has been getting lots of business from Gary Barnett’s Extell Development lately, including trophy listings at 995 Fifth Avenue, 535 West End Avenue and the Lucida. Four or five listings in another new development are also coming her way soon, she said, declining to identify the property. “I would love to represent a whole building,” Kleier said. “Truthfully, we have never been set up for it.” [NYT] [more]

From left: Vornado’s Steven Roth, the Lucida and Extell’s Gary Barnett

Vornado Realty Trust purchased 150,000 square feet of retail space in the Lucida condominium on the Upper East Side from developer Gary Barnett earlier this month for about $190 million, Crain’s reported. The space, at 151 East 85th Street, includes storefronts leased to Barnes & Noble, Sephora and H&M. The deal also includes 24 rental units in the building, which extends from 85th to 86th streets. There are currently 14 condo units for sale in the 20-story, 110-unit building, with asking prices ranging from $2.5 million to $10 million, according to Streeteasy.com. Earlier this month, the company acquired a 9.9 percent stake in J.C. Penney, and recently hired three new senior executives and began closing on a $1 billion investment fund. [Crain's]
 

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Though brokers typically get their commissions at closing, developers hoping to attract buyers to unfinished properties have advanced brokers part of their commissions when the sales contracts were signed. But since then, many of these deals have fallen through, and developers have been battling to get their money back, according to the New York Times. Gary Barnett of Extell Development, for one, is fighting to get back the more than $1 million he paid to various brokers who found buyers at his Lucida condominium project at 151 East 85th Street. If a deal fell through, brokers were obligated to return the commission in most cases. But until recently, they never had to worry that buyers would want to back out before closing. For the most part, developers and brokers were able to get buyers to close and when they didn’t, they have reached deals. Barnett said brokerages have paid him back in most cases. But he said the experience has taught him a lesson. “We’re not going to do that anymore,” he said, referring to advanced commissions. [NYT]

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The Lucida at 151 East 85th Street, Gary Barnett

A state Supreme Court judge ruled against residential broker Sloane Square NYC after the firm’s clients failed to close on two apartments at the Lucida condominium on the Upper East Side and the developer demanded a refund of the commission.
New York State Supreme Court Judge James Yates awarded a judgment in favor of Extell Development, which advanced half of the 3 percent commission payments up front and then demanded the money back after the buyers failed to close.
“Defendant was to receive a 3 percent commission for certain qualifying sales and defendant expressly acknowledged and agreed that it shall not be deemed to have earned a brokerage commission unless title closes and the agreed upon purchase price is paid or the prescribed consideration is delivered to or accepted by sponsor at closing,” Yates wrote in his Feb. 23 decision.
Extell President Gary Barnett said the decision was fair and reasonable given that the contract called for commissions to be paid for a completed sale.
“It kind of speaks for itself,” he told The Real Deal. [more]

Teplitzky is a managing director and head of the Jacky Teplitzky team at Prudential Douglas Elliman, which was Elliman’s top performing group in 2008.

What’s the last deal you closed?
I just closed at the Lucida at 151 East 85th Street at $6,784,610.

Where are the best sales deals right now?
The Upper East Side. There is more inventory, more conversions and new construction.

Compiled by Lauren Elkies [more]

The Lucida at 151 East 85th Street, Gary Barnett

An Extell Development affiliate is suing a small residential brokerage firm for breach of contract for allegedly keeping nearly $200,000 in commissions at the Upper East Side condominium tower Lucida, even though the sales were never finalized, Meanwhile, in the Financial District, the international architectural firm Skidmore, Owings & Merrill claims its landlord, a partnership between real estate private equity firm Capstone Equities and investor the Carlyle Group, has stiffed it on more than $1 million in tenant improvement work at its Financial District office, a recent lawsuit says. Also in the Financial District, a stalled condo conversion project has created one more headache for the German lender Deutsche Bank that provided equity financing for the site at 45 John Street. [more]

Sales have slowed at environmentally friendly buildings since January, according to statistics compiled by Streeteasy.com and New York Magazine. At the Laurel, at 400 East 67th Street, the Lucida, at 151 East 86th Street, and the Edge in Williamsburg, there have been no buyers since the beginning of the year. Sales were slow in the first quarter at Toren in Downtown Brooklyn, though the building has had three apartment sales in the past three weeks. Sustainability is not a deal-breaker for most condo buyers, said appraiser Jonathan Miller, especially when they are more focused on their jobs and the state of the economy. [more]