The Real Deal New York

Illustration for The Real Deal by Squat Design

At press time, European leaders had reached a deal to avert a potentially disastrous Greek debt default. The move could have implications in NYC, where some foreign buyers have been spooked into inactivity by the European debt crisis for weeks, while others, from tottering economies, have flooded into the city as a safe haven. The Real Deal looks at 10 countries that send a significant number of homebuyers here, and breaks down the priciest 2011 deals involving foreign players. [more]

The Real Deal’s November issue went live this week, and there are now more ways to enjoy the latest industry news and analysis than ever before. To view the issue on your digital device — photos, graphics, charts and all — as it appears in the magazine, use the version embedded below. This format works well for TRD readers with iPads seeking on-the-go, digital access to this month’s stories. (Click the “Full-screen view” button on the navigation bar below to enter full-screen mode.)

Andrew FarkasF. Scott Fitzgerald once said, “There are no second acts in American lives.” But billionaire investor Andrew Farkas is proving that there are — at least in real estate. Farkas — who built Insignia Financial Group into one of the largest real estate brokerages in the country in the 1990s — is carving out a sequel for himself that could rival his most prolific run of the past 20 years. [more]

A view of Jed Garfield’s kitchen and upstairs living room, which is filled with Damien Hirst paintings and sketches.

A New Yorker’s address is a marker of identity — especially if the New Yorker is a residential real estate broker. This month, The Real Deal peeked inside the homes of some of Manhattan’s top brokers to find out what’s behind their front doors. [more]

Ron Moelis

In 1998, L+M Development Partners started its first affordable housing project on West 148th Street, between Adam Clayton Powell and Frederick Douglass boulevards. At the time, the vacant block was inhabited solely by boarded-up, graffiti-scrawled buildings, abandoned by their owners in the ’60s and ’70s. In the middle of the block sat P.S. 90, a Collegiate Gothic-style structure built in 1907 by architect Charles Snyder. Unused by schoolchildren for 30 years, the building’s windowpanes were broken or missing, and its stone gargoyles tarnished. Trees sprouted amid overturned desks. [more]

Mark Rose, CEO of Avison YoungReal estate executives are quietly fuming over what they say are aggressive bonuses that several new and expanding commercial firms are paying to poach brokers. The past two months have been a particularly active time for brokers shifting alliances, partly because some firms have stumbled in the weak economy and make for soft targets, and partly because brokerages with a national presence are expanding into the New York market, which remains one of the strongest in the nation. In the last few months, the firms Avison Young, Stan Johnson, Lee & Associates and Brookfield Financial have all made plays to open or expand in New York. [more]

Scott RechlerScott Rechler is the CEO and chairman of RXR Realty, a multibillion-dollar private real estate company with roughly 20 million square feet of Class A office and industrial space. The firm — which is headquartered in Long Island and develops and owns property in the New York Tri-State area — recently completed the purchase of the 2.3 million-square-foot Starrett-Lehigh Building for $920 million. Rechler previously served as CEO and chairman of Reckson Associates Realty, which he sold to SL Green Realty in January 2007 for roughly $6 billion (including the assumption of $2 billion in debt) in one of the largest public real estate management buyouts in REIT history. [more]

We won’t be bringing you a crowd that’s going to boo a soldier, cheer executions or applaud the death of an uninsured man, like we’ve seen at this year’s Republican presidential debates. But this month at Lincoln Center, The Real Deal‘s first debate — in which real estate bigwigs will square off against one another — promises to be a heated discussion of some of the key issues facing the industry today. [more]

Microsoft cofounder Paul Allen kicked off last month by closing on the $25 million purchase of the penthouse co-op at 4 East 66th Street, where he already reportedly owns an apartment on the 11th floor. Allen appears to have had the inside scoop on the property, since it was not listed. [more]

The autumn leaves are turning, and New York’s fall real estate market may be changing, too. Autumn has traditionally been one of the busiest times of the year for residential sales, along with spring — the season of tax refunds and bonuses. But real estate brokers say the fall selling season has declined in importance over the past few years, thanks to factors like the city’s dependence on bonuses and later-than-usual Jewish holidays. [more]

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The Manhattan office leasing market began the year on a tear, leading executives as recently as four months ago to predict that volume could top 30 million square feet in relocation and expansion deals. Now, however, professionals — who have seen demand wane in the second half of the year — expect activity will fall far short of that. . [more]

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Many New York City real estate developers are back in business, reviving once-stalled condo projects or converting office buildings into rentals. But while developers are patting themselves on the back, their architects may be stifling groans. These days, architects are increasingly being asked to design buildings that can change from rentals to condos or vice versa, as developers seek to hedge their bets in a still-uncertain economy. But rental units tend to be smaller, with lower-end finishes and amenities, so designing buildings that serve as both is no easy task. [more]

Top row, from left: Company founders Joe Gebbia, Nathan Blecharczyk and Brian Chesky. Bottom row: A sampling of some of the deals listed on Airbnb last month and their nightly rates (from left): apartments on the Upper West Side, on the Lower East Side and in Harlem

In late June, a San Francisco woman blogged about a nightmare experience renting her apartment through the increasingly popular online listing service Airbnb. She had returned from a week of business travel to “an apartment that had been ransacked” and burglarized, right down to an allegedly photocopied Social Security card. [more]

Elad’s Thomas Elliott in the lobby at 250 West. Inset, the exterior of 250 West.

You’ve likely zipped past 250 West Street while driving up the West Side Highway. The former fruit-and-vegetable warehouse has arched windows, iron shutters and the words “West Street” stenciled on its Hudson River-facing façade. The brick building — which takes up an entire square block between Washington Street and the highway — was for years an administrative space for Citibank. Then, in 2006, it was purchased by the Elad Group, the Israeli developer famous (or infamous, depending on your perspective) for converting the Plaza Hotel into condos. [more]

Is a little-publicized switch in federal mortgage policy causing huge problems for condominium sellers, buyers and home-owner association boards across the country — even depressing prices and blocking refinancings? Condo industry leaders, from the 30,000-member Community Associations Institute to individual unit owners and real estate agents, are emphatic that the answer is yes. They say a series of rule revisions by the Federal Housing Administration has caused thousands of condo projects to become ineligible for FHA mortgages. [more]

State launches new real estate finance division

Benjamin Lawsky (left) with Gov. Andrew CuomoNew York State has created a real estate finance division under the umbrella of its newly established Department of Financial Services, Newsday reported last month. [more]

In the late 1990s and early 2000s, the Internet was like an up-and-coming neighborhood — early investors who recognized its potential snapped up property at bargain prices. Now, the value of their investments has increased exponentially. Donna Olshan, president of Olshan Realty in Manhattan, was one of these investors. After reading “Being Digital” by Nicholas Negroponte in 1995, she began to realize the potential of the World Wide Web and started buying unused domain names, or, as she calls it, “Internet real estate.” [more]

Wendell Walters, an assistant commissioner at the NYC Department of Housing Preservation and DevelopmentLast month, six developers and Wendell Walters, an assistant commissioner at the NYC Department of Housing Preservation and Development, were arrested on charges of wire fraud, money laundering, racketeering, extortion and bribery. Prosecutors alleged that Walters, a former college basketball player also known as “The Tall Guy” or “The Big Man,” demanded bribes from the developers he selected for multimillion-dollar HPD contracts, pocketing cash, a Harlem townhouse and a Bronx apartment building. [more]

Illustration for The Real Deal by Peter BonoLast month, Fredrik Eklund, a Prudential Douglas Elliman managing director who also runs an eponymous Stockholm-based brokerage, was arranging the sale of a $6.5 million Upper East Side triplex to an overseas buyer from Greece. Given the economic chaos plaguing the Hellenic republic, it may seem unlikely for a Greek buyer to invest millions in New York City real estate right now. But the reasoning behind the purchase was simple: “They have to get their money out of Greece,” Eklund said. [more]

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Illustration for The Real Deal by Paul Ciaravino

It’s an oft-repeated mantra in New York real estate that foreign buyers pay in cash. Indeed, their ability to come to the negotiating table with rubles and renminbi and reals in hand — ensuring a quick closing — is seen as confirmation of their affluence.
“The perception here is that because they’re not getting a loan in the United States … they are these really wealthy people putting down hundreds of thousands of dollars,” said Marc Fitapelli, a Manhattan-based commercial and residential real estate attorney. [more]

Twenty-Ninth Street, between Fifth Avenue and Broadway, is a block in transition. Once dominated by knock-off purse dealers and wholesale perfumeries, this diverse stretch is now home to a hip hotel and pricey new boutiques. It’s also the site of the Masjid Ar-Rahman mosque, and the scents of halal now mingle with those of Stumptown Coffee, the Michelin-starred Breslin Bar & Dining Room, and the Pakistani and Indian restaurant Gourmet Palace. A few doors down is the church where Donald Trump married his first wife, Ivana. [more]

Residential
A.C. Lawrence & Company
The firm hired Kalani Tom, Joshua Schneider, Terralyn Mills, Amanda Bond, Theresa Fisher, Esther Motta and Gino Ciravolo as residential agents. [more]

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1980: CITY SEES RECORD RATES OF ARSON

1930: MINI GOLF FILLS VACANT DOWNTOWN OFFICE SPACE

1902: FIRST STEEL-FRAME TOWER RAZED FOR GRAY LADY [more]

Three autumns ago, the collapse of Lehman Brothers knocked the wind out of New York’s real estate industry. Home sales flattened. Prices plunged. And, as layoffs mounted, office buildings emptied out. While there have been some spurts of activity, the industry has not gotten back to the highs of the boom. In fact, as the unemployment rate still hovers at an uncomfortably high level, and Wall Street (a once-reliable real estate engine) reports losses, it seems that a complete recovery might be years away. [more]

Back in the late 1970s, artists and like-minded bohemians who colonized the area in Brooklyn that lay in the shadow of the Manhattan Bridge thought they had hit on a bright idea: Apply the somewhat unlovely name of “Dumbo” to the area, and it would stand in such a bad odor that no one, least of all developers, would ever want to go there. According to this logic, the place would thus be safe for its down-at-the-heels inhabitants to continue living in large lofts without having to pay too much. [more]

New York is, of course, the shopping (and eating) capital of the country — if not the world. But what do the latest concerns about a double-dip recession mean for the countless stores, restaurants and shops packed into Manhattan? In this month’s Q & A, The Real Deal talked to Manhattan retail brokers about how the retail market — which tanked in the wake of the 2008 financial meltdown — is holding up. [more]

New Jersey
B-baller goes from hard court to federal court

Tate George, a onetime New Jersey Nets basketball player, was arrested last month on charges of running a $2 million Ponzi scheme under the guise of a real estate development firm, the Newark Star-Ledger reported. [more]

Chicago

Hotelier Ian Schrager last month opened the new Public Chicago hotel at 1301 North State Parkway. The 285-room hotel, formerly home to the Ambassador East, is the first in Schrager’s new line of mid-range properties aimed at cost-conscious guests, Bloomberg News reported. [more]

Trump Place sites could fetch up to $400M

Two Trump Place development sites — one on the southwest corner of 61st Street and West End Avenue and the other at the northwest corner of 59th Street and West End — have been put on the market, the New York Post reported. The seller is a joint venture between the Carlyle Group and Extell Development that is looking to reduce its joint holdings. [more]

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Click here to try your hand at an interactive version of The Real Deal’s November 2011 crossword puzzle.

Sales Update

Dumbo
Harlem Sol
121 and 123 West 131st Street

17 Orchard StreetHarlem Sol 121, a four-unit condominium, and eight-unit Harlem Sol 123 have reached the 50 percent-sold mark. The remaining units in the two buildings range from studios to a three-bedroom duplex. Prices are between $299,000 and $729,000. [more]

Battery Park City

$1.22 million
300 Rector Place

300 Rector Place2-bedroom, 3-bath, 1,600 sf combination condo in a full-service doorman building; unit has view of the Hudson River; building has elevator, storage, roof deck, gym, garden and bike room; common charges $2,079 per month; taxes $1,552 per month, asking price $1.399 million; 39 weeks on the market. (Brokers: Cheryl Greenberg, A.C. Lawrence & Co.; Greg Olson, A.C. Lawrence) [more]

Fredrik Eklund and his firm’s first Stockholm officePrudential Douglas Elliman managing director Fredrik Eklund wants to take on the world — literally. In addition to his work in New York City with Elliman, Swedish-born Eklund also owns a two-year-old real estate firm in Stockholm, which opened its second office in the city last month. And Eklund told The Real Deal he will soon launch a new firm in London. Called Eklund London New York, the new firm will be an offshoot of the 26-agent Swedish company. [more]

Westchester-based National Condo Advisors has introduced a new program to help residential projects comply with intricate Federal Housing Administration guidelines. The company has already signed up 14 New York City clients for the new program, called “Continued Condo Compliance,” according to CEO Orest Tomaselli. Four-year-old National Condo Advisors was founded to help condo projects obtain approval for FHA loans, Tomaselli said. He launched the new initiative, he said, in order to address a problem that arose in September, when the federal Department of Housing and Urban Development implemented new rules for condos seeking approval for buyers to obtain FHA loans. [more]

What started as something of a publicity stunt has become an ambitious — and time-consuming — labor of love for real estate attorney Philip Lavender. A lawyer at Brooklyn-based Marcus Attorneys, Lavender recently launched a website called OfferingPlanet.com, which transforms condo and co-op offering plans from thick books stacked in real estate offices to digital files on the Internet. [more]

Jonathan Miller shows off his catch.Most New Yorkers know appraiser Jonathan Miller as the statistics guru who produces quarterly market reports for Prudential Douglas Elliman. Few realize that he’s also a lobster fisherman. But Miller, the CEO of Miller Samuel Real Estate Appraisers, says the two vastly different specialties sometimes go hand in hand — or claw to claw, as it were. [more]

It can help find everything from restaurants to auto mechanics. And now users of Yelp.com, the fast-growing consumer-review website, have turned their attention to real estate brokers. Yelp, which launched in San Francisco in 2004, allows users to rate businesses by giving them one to five stars, accompanied by detailed descriptions of their likes and dislikes. The site now has more than 63 million users in 12 countries, the company said, and New York City is among the most heavily trafficked cities on Yelp. [more]

Top: The cover of “Brokers Who Dominate”; bottom, from left: Faith Hope Consolo, Stephen Siegel and Bob KnakalCommercial real estate brokers Faith Hope Consolo, Robert Knakal and Stephen Siegel are well-known personalities in New York City real estate. But thanks to bookstore shelves, Kindles and Amazon.com, they’ll soon be introduced to a much larger audience. The three Manhattan brokers are featured in a new book, released in September by Domus Publishing, called “Brokers Who Dominate: 8 Traits of Top Producers.” For just $24.99, readers can now learn the secrets and stories of real estate professionals from across North America. [more]