Is New York City’s luxury housing bubble getting ready to pop?
It’s a recurring and, as of late, frequent question — and one that industry heavyweights tackled Wednesday at the Urban Land Institute’s fall conference.
Developments along the 57th Street corridor – dubbed Billionaires’ Row – have been cited most often as examples of an inflated market, thanks to eye-popping prices like the $34 million paid recently for a 4,483-square-foot condo at Extell Development’s One57.
Bruce Beal, president and general partner of Related Cos., noted that high land costs in the area helped spur the high-end projects, which also benefitted from investments of foreign capital. “The question is how much more foreign capital is going to flow in here,” he said.
“If you look domestically, you are unfortunately pricing out people who live here. Not everyone is a hedge fund manager,” said Beal. “I tend to think we’re kind of at the top of what really should be produced there now.”
Robert Toll, executive chairman of national homebuilder Toll Bros. Inc., acknowledged the push-and-pull felt by developers. “It seems like we hit the goal post last year,” he said, adding that it’s “difficult to pull the ripcord and say, ‘Enough.’”