Leaving so soon? Resales abound at 432 Park

Resale listings outnumber sponsor units on StreetEasy

New York /
Apr.April 04, 2018 07:00 AM

432 Park Avenue (Illustration by Lexi Pilgrim for The Real Deal)

Less than a month after the first buyer at 432 Park Avenue closed on an $18.1 million pad in 2015, the unit hit the rental market for $60,000 a month. It reappeared this past January as one of the tower’s first resale listings — priced at $17.499 million, or a roughly $618,000 loss.

In the last six months, 13 resales at Macklowe Properties and CIM Group’s supertall have quietly hit the market, nearly triple the number of sponsor units available, according to listing data from StreetEasy.

Brokers said that although the luxury market has cooled — meaning sellers may not get top dollar — rising inventory on Billionaires’ Row and lingering uncertainty about the market has made some skittish investors eager to cash out before competition heats up.

“If you look at that particular subset of uber-luxury real estate near the park, you have an onslaught of new development inventory that is coming down the pike,” said Douglas Elliman’s Michael Graves. “If you are an owner seeking to move that asset, now is going to be your best moment to do it.”

As of mid-March, 432 Park had 10 resale listings on the market — more than any other new development condo building, according to CityRealty. (The Baccarat Hotel & Residences was a close second with nine resales, followed by 10 Madison Square West with eight.)

Current resale listings at 432 Park range in price from $5.95 million for a one-bedroom to $68.5 million for a combination of two units on the 71st floor. On average, the resales are priced 22 percent higher than the first sale price.

“Everyone’s got their own story,” said Brown Harris Stevens’ Elese Reid, who is marketing the 71st-floor combination. Her client paid $59.8 million total for the two units in 2016, records show.

The first batch of resales at any new development can be a boon for early buyers if they can capitalize on momentum at the building.

Some early buyers at 15 Central Park West doubled their investments. One57’s first resale handed the seller (who paid $30.55 million in 2014) a nearly $4 million profit.

Walker Tower’s first resale generated a $3 million profit for the seller, Burt Freiman, who paid $5 million in 2013 and reportedly never set foot in the building. He re-sold the pad for $7.775 million.

But new development sales — particularly sales of ultra-luxury pads — have dipped since 2015 amid a flood of competing inventory. The median price during the fourth quarter was $2.7 million, down 7 percent year-over-year, according to Miller Samuel. The number of sales during the quarter was 387, down nearly 30 percent from 2015. And some resales at competing buildings like One57 have traded at a loss since the market began to slow.

432 Park’s first resale — a three-bedroom on the 48th floor — fetched $8.18 million in December, 12.46 percent more than the seller paid in April 2016. (The deal also include a studio, which went for $1.62 million, a slight premium over the $1.58 million sales price in 2016.)

In February, the developers of 432 Park said they sold $2 billion worth of condos, including 48 units that fetched north of $20 million each. At that time, sources said 85 percent of the building was sold and there were fewer than 10 units still available, including a penthouse asking $82 million.

But buyers at 432 Park who signed contracts and closed on their units in 2016 got an average discount of 10 percent, according to data from Miller Samuel.

The discount wasn’t that steep when Macklowe and CIM re-sold a half-floor pad on the 65th floor, after the original buyer decided to trade up. The original buyer paid $27.04 million for the unit in 2016; the sponsors resold it in December for $606,028 less.

“If you’re an investor, it’s not a great time to sell unless you want to put your money into something else,” said Compass’ Toni Haber. But that could be worth it for some uber-wealthy investors whose life circumstances changed and who may want to liquidate their purchase. “Some people don’t mind just taking the loss.”

According to Graves, investors looking to flip their units have a window of opportunity. Because 432 Park is move-in ready, it currently has an edge over still-unfinished projects like 220 Central Park South, 520 Park Avenue, Central Park Tower and 111 West 57th Street.

Reid’s client on the 71st floor was one of the building’s early buyers. He rented out one apartment and planned to use the other himself, but recently decided to sell both. “He’s just begun to divest a little bit,” Reid said. “If you ask me, I’d say keep them for a couple more years.”


Related Articles

arrow_forward_ios
Wells Fargo CEO Charles Scharf (Getty Images)
Wells Fargo backing off mortgage market
Wells Fargo backing off mortgage market
One Brooklyn Bridge Park units 427/8 and 1115 (StreetEasy, Google maps)
One Brooklyn Bridge Park condos top Brooklyn luxury market
One Brooklyn Bridge Park condos top Brooklyn luxury market
The Ritz-Carlton New York NoMad (The Ritz-Carlton New York, Illustration by Priyanka Modi for The Real Deal with Getty)
Ritz-Carlton NoMad evades short-term rental ban
Ritz-Carlton NoMad evades short-term rental ban
95 Charles Street (Illustration by Kevin Cifuentes for The Real Deal with Getty, Streeteasy)
Manhattan luxe sees 28 contracts signed in first half of August
Manhattan luxe sees 28 contracts signed in first half of August
740 Park Avenue and Corcoran broker Francine Crocker (Corcoran, Getty)
Tower of power: Duplex at 740 Park listed for $26M
Tower of power: Duplex at 740 Park listed for $26M
Douglas Elliman’s Kirsten Jordan and 2728 Thomson Avenue in Queens (Corcoran, Douglas Elliman, Getty)
TRD Pro: Queens’ priciest home sales in the second quarter
TRD Pro: Queens’ priciest home sales in the second quarter
Seattle Seahawks receiver and newly-licensed realtor Tyler Lockett along with 812 245th Place Northeast in Sammamish, Washington (Photo Illustration by Steven Dilakian for The Real Deal with Getty Images and Redfin)
NFL star earns his real estate wings
NFL star earns his real estate wings
Toll Brothers' Douglas Yearly and property at Sparks, Nevada (Toll Brothers)
“Honey, I bought the town:” Buyer ends up with big chunk of subdivision
“Honey, I bought the town:” Buyer ends up with big chunk of subdivision
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...