Extell lowers sellout target at One Manhattan Square

“We’re going to be very conservative,” says Gary Barnett

TRD New York /
Feb.February 22, 2016 02:20 PM

At One57, Extell Development raised prices at least 10 times to push some of the world’s richest buyers to their limits. But at its latest project on the Lower East Side, the developer is flipping the script by lowering the target sellout.

Extell dropped the sellout price at One Manhattan Square by $207.3 million to a total of $1.87 billion, according to a Jan. 22 amendment to the building’s offering plan.

“We’re going to be very conservative here,” Extell chief Gary Barnett told The Real Deal. He disputed the notion of having cut prices per se, instead describing the markdown as a change to early placeholder prices to better match the current market, which is showing signs of a slowdown at the top.

“We priced it where we want to start and we think we’ll raise prices from where we’re starting now,” he said.

Prices at the 815-unit One Manhattan Square will still start around $1 million. There are two $13 million penthouses, one of which is in contract, the developer said.

Extell bought the development site, a former Pathmark at 252 South Street, in early 2013 for a reported $175 million, including the $47 million buyout of the supermarket’s lease.

The 937,000-square-foot development is among the largest new condo projects in the city in recent years. Even at the lower target sellout price, it could set a record for Lower Manhattan, ahead of Rudin Management and Global Holdings’ 200-unit Greenwich Lane, which launched in 2013 with a $1.7 billion price tag.

Last fall, Extell said it would start marketing One Manhattan Square in Asia, giving buyers in China, Malaysia and Singapore first crack at scooping up units.

Despite turmoil in China’s financial market, Barnett said demand among Chinese buyers remains high. (Some Chinese families are moving money out of the country and into New York City real estate, according to reports.)

The New York Attorney General approved One Manhattan Square’s offering plan in October, and Barnett said a “fair amount” of buyers signed at the original prices, though he wouldn’t disclose further details. Extell gave those buyers price reductions after filing the Jan. 22 amendment, Barnett said. “We didn’t want to be unfair,” he told TRD.

Extell recently released dozens of renderings of the project, which will have 100,000 square feet of amenities, including fire pits, a putting green, a covered dog run, a 70-seat movie theater, a bowling alley, a dog spa and a cigar room.

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