Foreign businesses push Manhattan office condo demand

May 25, 2011 11:26AM

alternate
text
545 West 25th Street, 139 Centre Street and 50 West 57th Street

The decision to rent or to buy isn’t one that only affects home-seekers. It’s also a dilemma that businesses face. And increasingly, New York businesses want to buy their office space, which has bumped up the demand for office condominiums. According to the New York Times, much of the shift is due to cultural preferences. While many American businesses in the city prefer to lease office space to accommodate future growth, changing market conditions and other factors, foreign businesses favor purchases. Margarette Lee, a principal at New York-based developer Youngwoo & Associates, whose founder hails from Korea, said that the Asian businesses, in particular, covet office condos. The firm’s development at 139 Centre Street in Chinatown, for example, has been on the market for about two years, and just seven of the 144 condos and two of 10 retail condos remain unsold, according to Lee. Almost all the buyers are Chinese, and most paid $900 to $950 per square foot. Youngwoo also owns 545 West 25th Street and is interested in building or buying another office condo in Manhattan. The International Gem Tower at 50 West 47th Street also offers office condos, and the landlord has found many willing buyers among foreign diamond and jewelry businesses, according to the Times. Some buyers even purchase more space than necessary to accommodate future growth. The Times said if new business accounting rules that would force businesses to list rent as an expense or liability and owned property as an asset, currently being proposed by the Financial Accounting Standards Board, are enacted the marketplace could become even more office condo-friendly. [NYT]