Roth, Ross, Stacom, Holliday and Sturner
These days — with credit tight and lawsuits sprouting like weeds — no real estate transaction is simple. Whether it’s a one-bedroom condo or a distressed office building, sales are often slower and more complicated than expected. That said, some deals have so much “hair” on them that they deserve special recognition. This month, The Real Deal took a behind-the-scenes look at some of the most complicated deals in the last year. [more]
Mark Jaccom, the company’s CEO, says he has 20 contracts out to new brokers and is “talking to another 30.”
Mark Jaccom is trying to poach brokers from rival firms, and he seems to want everybody to know it. Sitting at the head of a large conference table in the Madison Avenue headquarters of Colliers International Tri-State last month, Jaccom held up a two-page spread imprinted with a baseball diamond, and smiled. Next to each base were the corporate logos of firms like CBRE, Cushman & Wakefield and Newmark. Next to each logo: a name. “If they’re on first base, we’re starting to talk,” said Jaccom, the pugnacious, 55-year-old CEO of Colliers’ Tri-State operations. [more]
When the real estate market crashed, tales of lowball offers abounded in New York: Buyers were in many cases demanding discounts of 25, even 30 percent, off asking prices. Those days, relieved brokers say, have passed. But in this steadier-if-somewhat-uncertain market, some say another frustration has emerged. Sellers, emboldened by the market’s relative improvement in the last year, are now the ones pushing their luck. While brokers and analysts agree that the market is still fragile, they say some sellers are getting greedy and demanding prices higher than currently justified. [more]
From left to right: David Greczek and Ammanda Espinal, on-site sales agents for Azure; Karen Mansour, executive vice president of sales and marketing at Prudential Douglas Elliman; John Caiazzo, vice president of the DeMatteis Organization; and Doug MacLaury, senior vice president of the Mattone Group (standing). Right: Azure at 333 East 91st Street.
A luxury apartment building towering 34 boxy stories above low-rise Yorkville shops, Azure has always been nondescript by design, and yet theatrically imposing in reality. Launched in 2007, the project was aimed at Manhattan’s growing population of families. Marketing materials emphasized child-oriented neighborhood amenities and focused on the customizable, three-, four- and five-bedroom units on offer. [more]
Aby RosenLately it seems developer Aby Rosen’s every business relationship is worthy of its own daytime soap opera. While Rosen and his company RFR Holding have been in the news a lot since the downturn hit because of struggles at 610 Lexington Avenue, which is on the brink of foreclosure, and because of a split with hotelier Ian Schrager, in the last few months the headlines have been even more fast, furious — and personal — than normal. In May and June alone, multiple news outlets, including The Real Deal, have published accounts of Rosen’s business feuds. [more]
Karen Heyman and Alan Heyman, Sotheby’s International Realty
The business of selling Brooklyn real estate has changed drastically in recent years. When Brooklyn native Karen Heyman first started selling Dumbo lofts in the 1990s, Manhattan residents refused to take the subway there. “I used to have to send my driver over the bridge to pick people up,” recalled Heyman, now a senior vice president at Sotheby’s International Realty. Today, “those same people are now on their third or fourth Dumbo apartment.” Brooklyn brokers have seen their business (and wallets) expand exponentially over the past decade, as a trickle, and then a flood, of resettling Manhattanites ventured across the East River. [more]
Jeff BlauJeff Blau is president of Related Companies, one of the largest private real estate development firms in the country, with a portfolio valued at over $15 billion. Earlier this year, Related launched MiMA, a 1.2 million-square-foot, mixed-use development on 42nd Street in Manhattan. The company is also developing the 26-acre Hudson Yards, the largest development site remaining in Manhattan, with plans for up to four corporate headquarters, a retail complex, a hotel, a public school and nine residential buildings. [more]
Stuart ElliottI find that the hardest thing about patting yourself on the back is being able to contort your arm to reach around behind you. In other words, self-congratulations doesn’t come naturally (or else I just need to start doing more exercise to get more flexible). But that’s not going to stop me from touting The Real Deal‘s latest accomplishment — winning the first journalism contest we’ve ever entered. Last month, The Real Deal took home first prize as the nation’s top commercial real estate magazine and won the industry award for the best commercial real estate story of 2010. [more]
The Manhattan residential market remained relatively stable, if lackluster, in the second quarter of 2011, according to newly released market reports. “We’re bumping along the bottom,” said Jonathan Miller, president of Miller Samuel Real Estate Appraisers and the preparer of quarterly market reports for Prudential Douglas Elliman, the city’s largest brokerage firm. Manhattan’s median sales price in the second quarter was $850,000, 17 percent below the market peak of $1.025 million in 2008, according to the Elliman report. That’s an improvement from the depths of the downturn, when Manhattan prices were down 25 to 30 percent from the high. “We’ve recaptured some of that,” Miller said. [more]
For a year now, industry insiders have worried about the possibility of a bubble in the commercial real estate market, amid rapidly rising prices for trophy properties. A number of recent purchases, including Harry Macklowe’s $255 million pending acquisition of 737 Park Avenue, have raised eyebrows for their high prices and low cap rates. [more]
The giant, 900,000-square-foot relocation and expansion lease that Japanese financial firm Nomura Holdings America signed in Midtown late last month punctuated an improved second quarter in the Manhattan office-leasing market. That improvement came even as the national economy was battling high unemployment and slow growth, preliminary data from commercial services firm Cassidy Turley showed. “Midtown, Midtown South and Downtown all recorded positive absorption in the second quarter,” said Robert Sammons, vice president of research at Cassidy Turley, citing a key indicator of a tightening leasing market. [more]
An apartment at 423 East 81st Street before and after a $45,000 renovation.
At the height of the recession, New Yorkers could rent deeply discounted apartments without paying brokers’ fees, but found that aging appliances and scuffed hallways were often the norm. Those days are over. Now, landlords are courting renters with granite countertops and new, stainless steel appliances — in exchange for higher rents, of course. With the market bouncing back and renter incentives disappearing, many landlords are ramping up renovations at their buildings, after several years of avoiding major capital projects. With rents rising, the economics of renovations make sense again. [more]
Looking for a deal where the home seller pledges in advance to contribute potentially thousands of dollars to your closing costs? If so, check out the summer sale terms available from two of the largest and most motivated sellers of foreclosed homes in the country — Fannie Mae and Freddie Mac. You may know the companies for their troubled mortgage businesses or the financial foibles that crashed them into the control of federal conservators in 2008. But the flip side of those problems is that they now have massive numbers of properties taken back through foreclosures. [more]
High Line, the next generation
The High LineThe second section of the High Line park on Manhattan’s West side officially opened last month. Running from 20th Street to 30th Street, the new phase is an extension of the first part of the park, which opened two years ago along a former freight rail structure. The project includes a public gathering spot known as “The Lot at 30th Street,” with a 350-seat bar operated by chef Tom Colicchio, a collection of food trucks and a public art exhibition. At the ribbon-cutting ceremony for the second phase, Mayor Michael Bloomberg announced a $5 million challenge grant to Friends of the High Line to help finance the third section of the park. When completed, the High Line will be 1.45 miles long and stretch to 34th Street. [more]
Real estate brokers must regularly ask their clients a question that most people consider to be the height of rudeness: “How much money do you have?” But buyers’ brokers need to find out what their clients can afford — and what they are worth — before showing them apartments or submitting their financials to a co-op board. “We’re a city of 80 percent co-ops, [and] bringing a perspective purchaser to a co-op if you haven’t asked about their net worth is a waste of time,” said Kathy Braddock, co-founder of Rutenberg Realty. That’s especially true in today’s strict lending climate, in which banks have stringent requirements for mortgages. [more]
Late one Thursday afternoon last month, title insurance agent Rafael Castellanos got an urgent call from an attorney whose client needed a title search on a Brooklyn home that was selling three days later in a foreclosure auction. Title insurance agents — who work with underwriters to provide insurance for buyers to protect against unforeseen problems on the titles of their new homes — typically conduct extensive research to ensure that there are no troubles with a title. The goal is to ferret out and resolve any “clouds,” such as outstanding liens on the title or defects in the chain of ownership, so they don’t come back to haunt the buyer later. [more]
111 Eighth AvenueAs any theatergoer knows, there’s nothing like a pause in the action to build the dramatic tension. And that’s exactly what happened when Google — the behemoth technology company based in Mountain View, Calif. — asked for (and quietly received) a several-week break in the active marketing of 111 Eighth Avenue during the second half of November, when it became serious about buying the building. Google, which was represented by CB Richard Ellis, wanted to make sure that the $1.77 billion (plus millions in additional expenses) it was about to spend on the 2.9 million-square-foot Chelsea office building was a good price. [more]
One Park Avenue
“‘We are going to have a gun to our head,’” one real estate insider recalled top Vornado Realty Trust executive Glen Weiss saying, once the office giant decided to go ahead with its acquisition of One Park Avenue. In order to buy and recapitalize the building, Vornado had only weeks to nail down a large lease expansion with NYU Langone Medical Center, pay off mezzanine lenders, secure the first mortgage lender, and work out a deal with Murray Hill Properties and Cerberus Capital Management, the property’s owners. [more]
The Sloane mansionThe Henry T. Sloane mansion made headlines in 2008 when it hit the market for $64 million, an eyebrow-raising price even for the dizzying heights of the boom. Had it sold at that amount, it would have become the most expensive home sale in New York City history. Instead, it prompted the city’s priciest-ever residential foreclosure auction last month, according to PropertyShark.com. Located at 18 East 68th Street between Fifth and Madison avenues, the mansion has been the object of public fascination since its inception. [more]
From left: Lansco Corp. agents Robin Abrams, Howard Dolch and Lisa RosenthalTrying to squeeze into a size that’s too small doesn’t usually work — whether it’s a person dressing for a night on the town, or a retailer looking for its flagship site. Yet with a creative tweak, clothing retailer Syms managed to wriggle into a new Fifth Avenue storefront it badly wanted. The apparel company liked the retail space at 530 Fifth Avenue, but thought it was just too petite. To get around that, Syms’ brokers, along with landlord Joseph Moinian, arrived at the idea of also leasing a piece of second-floor office space. [more]
607 Hudson StreetWhile scores of developers, partners and lenders took each other to court during the downturn — and tried to squeeze each other for more money — one Manhattan buyer and seller managed to keep the peace despite the economic roller coaster ride. The deal involved 607 Hudson Street, a highly coveted spot at the corner of 12th Street in the West Village. The site, which was occupied by the non-profit VillageCare’s nursing home, went into contract in 2007. It didn’t close for almost four full years, but the deal emerged from the downturn with only minor scrapes. Real estate insiders said the four-year contract was the longest purchase agreement in a straightforward real estate transaction they could recall. [more]
3 Columbus CircleLate last year, an attorney for developer Joseph Moinian handed Manhattan’s County Clerk a cashier’s check in the stunning amount of $258,550,838.52. It was drawn from the bank account of SL Green Realty, Moinian’s partner at 3 Columbus Circle, and delivered as a show of good faith. The so-called tender offer was designed to short-circuit litigation among three heavyweight Manhattan office landlords. But the tender — believed to be by far the largest ever deposited with the Clerk’s office — failed in its immediate goal to end the now-famous saga over the fate of 3 Columbus. [more]
Brooklyn native Margaret Cuonzo at 50 Duffield Street in Downtown Brooklyn.In the current market, home purchases — even at the lower end of the price spectrum — can be just as hairy as commercial real estate deals. Brooklyn native Margaret Cuonzo, for example, got a steal on her recent purchase of 50 Duffield Street, the three-family Downtown Brooklyn townhouse she is currently renovating. [more]
Harry Helmsley
1961: Final parcels of Rhinelander estate sold
1931: Feds confiscate illegal distillery in Tishman building
1900: Bronx apartment owners taken on over free rent
[more]
Double-dip fears notwithstanding, the real estate industry is seeing a resurgence of private equity investment. But this time around, firms who got burned during the financial crisis are taking a different tack. Instead of doing deals on a one-off basis, with a different developer on each deal, a growing number of private equity funds are forming exclusive agreements with experienced developers through new, independent real estate operating companies in New York City and elsewhere. In an environment where many see enormous potential for growth, these investments give private equity players a leg up on the competition, and a chance to share in higher profits (known as the “promote”) if the project succeeds. [more]
Appraisers — even compared to other real estate professionals — took a severe beating during the real estate downturn. And while the housing market just might be coming off the ropes to fight another round, the appraisal industry is still down on the mat. In fact, some professionals worry the shrinking industry may be in for even more dire straits ahead, thanks to new types of mortgage fraud (see sidebar) and new regulations. “The sad thing is that there are many good appraisers who simply can’t afford to do business anymore,” said Jonathan Miller, CEO of appraisal firm Miller Samuel. [more]
Becoming successful in real estate is not easy. Not only does it take a stomach for risk, it also takes the ability to bounce back from failed projects — as many are trying to do now. But once real estate executives achieve a certain level of success, they often seem to branch out to other areas of business. For a while, the preferred next area seemed to be banking. Then, it was professional baseball and football teams. Now, all bets are off — or should we say on? — as a rush of real estate moguls get into horse racing and gaming, with the properties associated with these activities available at discounts. [more]
A rendering of the new Whitney MuseumAll museums, like buildings in general, have a real estate dimension. From the simple act of purchasing the lot on which the museum will rise to the structure’s interaction with the buildings that surround it, a museum is part of the urban fabric. As such, it bespeaks the attitudes and acquisitiveness of the citizens whom it serves. But the new $680 million Whitney Museum building, which broke ground on May 26 on Gansevoort Street between West and Washington streets along the High Line, seems more intimately and also more insistently in touch with this real estate element than perhaps is true of any other museum to date. [more]
Vickey Barron, of CoreOn a warm Saturday last month, apartment-seekers who followed signs for an open house at 915 President Street in Park Slope were surprised to find not one, but two units for sale in the building. The listing agents, Prudential Douglas Elliman’s Immacolata Giocoli and Joseph Baglio of the Brooklyn firm Madison Estates, had teamed up to market the two airy studios on the first floor of the prewar co-op, which are each priced at around $250,000. They directed visitors to each other’s listings, and pointed out that the apartments can be combined. At first, it may seem counterintuitive for rival brokers — who are, after all, competing for the same pool of buyers — to work together in this way. But Baglio said he views the co-open house as “double-exposure” for his listings. [more]
The legendary Upper West Side institution H & H Bagels may have unexpectedly shuttered last month, leaving residents without piping hot sesames and poppies, but don’t take that as a sign of the times for the rest of the neighborhood. Residential real estate in the area seems to be rebounding stronger than many of its counterpart neighborhoods in Manhattan, at least for desirable properties. In this month’s Q & A, brokers who specialize on the Upper West Side told The Real Deal that business, while not quite back to normal, has vastly improved over the last year, especially for new luxury rentals and large family-sized apartments. [more]
New Jersey: Garden State housing prices see slide
Home prices across the country are the lowest they’ve been in five years. And New Jersey is no different.
While prices performed slightly better in the Garden State than they did nationally, they were down 24.2 percent for single-family homes in northern and central New Jersey in March from their peak in 2006 and down 3.4 percent compared to a year ago, according to the Star-Ledger, which cited data from the Standard & Poor’s/Case-Shiller Home Price Index that was released last month. [more]
A rendering of Boston’s Assembly Square
Boston
After two decades of delays and false starts, a $1.5 billion revitalization of Assembly Square in Somerville will begin construction this fall, the Boston Globe reported last month. Developer Federal Realty Investment Trust will receive $104 million in federal and state funds for the project, according to the Globe. The project will transform 60 acres of industrial property into office buildings, a hotel, homes and an Ikea store. Work will also begin this fall on the construction of the long-planned Assembly Square Orange Line T-station, and AvalonBay Communities will break ground on the site’s first two residential complexes. Initially conceived in the late 1990s, the Assembly Square project drew community opposition and later lost funding in the economic downturn. [more]
Chetrit, Levy put 620 Sixth up for grabs
A partnership of Joseph Chetrit, Yair Levy and Charles Dayan is looking to unload 620 Sixth Avenue. According to the Observer, the nearly 800,000-square-foot mammoth anchored by Bed Bath & Beyond could fetch around $500 million. The landlords purchased the Chelsea property for $289.8 million in 2005, taking out a $235 million mortgage that they nearly defaulted on in the years following. [more]
Sales Update
159 West 24th StreetChelsea
Carriage House
159 West 24th Street
Sales are officially underway at the 24-unit, 32,000-square-foot residential conversion project developed by Broad Mill Development Group. The building, a former carriage house and parking garage, has a mix of studios, one-bedroom lofts, duplex lofts and two-bedroom penthouses. Interiors are designed by Gustavo Martinez. Prices start at $695,000 and go up to $3.6 million. Amenities include a part-time doorman, an IP video intercom system and shared rooftop space. Warburg Reality is the agent. Contact: www.carriagehouse24.com. [more]
Chelsea
$792,000
219 West 14th Street
1-bedroom, 1-bathroom, 650 sf condo in a prewar walk-up building; unit has new kitchen, new bathroom and terrace; building has voice intercom, laundry room and bicycle storage; common charges $349 per month; taxes $392 per month; asking price $783,000; 2 weeks on the market. (Broker: Dmitry “Daniel” Kramp, City Connections Realty) [more]
It’s easy for Charles Doolan to explain why he left the 100 percent — commission firm Rutenberg Realty to launch his own brokerage. “I saw a loophole in their structure,” Doolan said. “I felt I could improve upon it and make it better for rental agents.” Doolan’s new firm, Kian Realty, launched last month in a 1,600–square–foot office at 450 Seventh Avenue. Doolan said he expects to hire 100 agents over the next year and 200 by 2014. He currently has six, including himself. The firm has a similar model to Rutenberg, but with a different fee structure, Doolan explained. At both Rutenberg and Kian, agents keep the lion’s share of their commissions, paying fixed monthly fees instead. When Kian agents do a rental deal, however, they pay $200 to the firm for apartments that rent for less than $2,000 per month, and $400 for all other rentals. [more]
After years of working separately, father–and–son broker team Siim and Rudi Hanja recently joined Brown Harris Stevens, where Siim is now a senior vice president and his son is a licensed real estate salesperson. Siim moved to BHS after spending a decade at Stribling. Rudi previously worked at Prudential Douglas Elliman. The two have spent the majority of their professional careers working with the real estate market downtown, where they have both lived for most of their lives. But until now, they’ve never officially worked together as real estate brokers. [more]
In an elaborate ceremony held last May, Barak Dunayer, founder of the boutique firm Barak Realty, handed out bonuses to his top–producing agents in an effort to build loyalty and keep his agents from bolting to larger firms.
One of those who received a check was Jeffrey Tanenbaum, who was honored as Barak’s top–earning sales agent. But last month, Tanenbaum became a senior vice president at Halstead Property, the city’s fourth–largest brokerage. [more]
The pool at 15 Central Park West
One of the selling points emphasized by brokers at the Edge condominium in Williamsburg is the major weekend scene at the pool, with lots of sunbathing, picnicking and socializing. At 20 Pine’s pool in the Financial District, neighbors regularly practice yoga and host parties. [more]
The rooftop at One Brooklyn Bridge Park
New Yorkers are not just shopping for apartments this summer. They’re also increasingly buying their own private pads on the roofs of their buildings. Sales of rooftop “cabanas,” which residents at some new city condo buildings can buy for their own exclusive use, were slow during the downturn. But brokers say sales for these luxury, outdoor add-ons have recently picked up. [more]
Corcoran Sunshine’s Division III softball team
It’s shaping up to be an intense summer for the city’s major residential real estate firms, not only at the closing table but on the playing field as well. Several of the city’s major residential firms — the Corcoran Group, Prudential Douglas Elliman and Halstead Property — play against each other in the NYC Metro Sports League, which includes about 200 co-ed corporate softball teams from different industries. [more]
Appraisers who have weathered the last few years are now feeling a new type of pressure. In the past, appraisers often felt compelled to submit higher-than-market appraisals to convince borrowers that properties were worth their hefty asking prices, and keep the mortgage pipeline primed with deals. Now, however, they are facing the opposite pressure. Tight credit markets and gun-shy lenders mean appraisers are often pushed to be conservative with their valuations and come in below market. [more]
