The Real Deal New York

Trump buildings withstand luxury market weakness

The catch: it’s because they’re not actually luxury anymore
September 15, 2016 10:55AM

The Trump Tower at 725 Fifth Avenue

Trump Tower at 725 Fifth Avenue

Will Donald Trump’s divisive presidential run impact sales at the apartment buildings carrying his name? It’s too early to tell, but his New York properties seem to be doing fine amid a strong market for mid-priced condos.

StreetEasy’s price index for 16 Trump-brand apartment buildings rose 5.42 percent to $1.674 million over the past year. The reason these buildings are doing well is because they are mostly “priced on the lower end of luxury,” according to StreetEasy economist Krishna Rao. It’s a market that has fared significantly better than the top end of the luxury sector.

“We’re moving out of a market that’s solely focused on superluxury, and for the developers who can get the formula right, demand for entry- and middle-income new development — the heralded $1 million to $3 million — can’t be satiated,” Miller Samuel TRData LogoTINY president Jonathan Miller told the New York Times earlier this month.

Despite Trump’s gold-plated image, many Trump-brand buildings are old and don’t technically qualify as luxury (defined as the top 20 percent of the market).

In contrast, StreetEasy’s Manhattan Luxury Price Index – which includes more expensive apartments – fell by 1.58 percent to $3.206 million.

Once a prolific condo developer, Trump has largely retreated from building in Manhattan over the past decade after a string of bankruptcies.  [Mansion Global]Konrad Putzier