The city values Ken Griffin’s record-setting $238M penthouse at $9M. Here’s the math behind that

The tax systems undervalues condos in prime neighborhoods

TRD New York /
Feb.February 28, 2019 08:00 AM

Ken Griffin and 220 Central Park South (Credit: Wikipedia)

Billionaire Ken Griffin set a record with his $238 million condo — but New York City values the property only at $9.4 million.

The city’s property tax system requires all condos and co-ops to be assessed as if they were rental buildings, the Wall Street Journal reported. Assessors look at rental income at nearby buildings to estimate a condo’s value. So Griffin’s effective tax rate comes out to about 0.22 percent.

The tax rate is similar to that of other individual homes in Manhattan and prime Brooklyn neighborhoods where taxes have been capped as property values have climbed. The city undervalues condos in prime neighborhoods, according to the Independent Budget Office. Co-ops and condos were valued at about 20 percent of their market value, per estimates.

“It is a crazy system,” said Martha Stark, a former city finance commissioner. “The true market value bears no relation to sales price, and nowhere is that truer than among high-value coops and condos.”

In January, Griffin closed on a massive penthouse at 220 Central Park South. The priciest residential deal to date is a $361 million home in Hong Kong in 2017. While Griffin’s deal falls short of that purchase, it breaks the record for priciest U.S. home sold.

The tax rate on Griffin’s penthouse was determined before the purchase closed, and one expert told the Journal that the rate could increase come 2020. [WSJ] — Meenal Vamburkar


Related Articles

arrow_forward_ios
Vornado's Steve Roth and 220 Central Park South (Credit: Getty Images, iStock)

Free and clear: Vornado pays off debt at 220 CPS

Free and clear: Vornado pays off debt at 220 CPS
At record-breaking 220 Central Park South, a unit just closed at $6,400 a foot

At record-breaking 220 Central Park South, a unit just closed at $6,400 a foot

At record-breaking 220 Central Park South, a unit just closed at $6,400 a foot
Against all odds: A by-the-numbers look inside Vornado’s 220 Central Park South

Against all odds: A by-the-numbers look inside Vornado’s 220 Central Park South

Against all odds: A by-the-numbers look inside Vornado’s 220 Central Park South
265 East Houston (Google Maps)

Tech entrepreneur’s dismembered body found in LES condo

Tech entrepreneur’s dismembered body found in LES condo
According to the report, purchase applications are down while refinancing is up (iStock)

Applications for mortgages to buy homes drop

Applications for mortgages to buy homes drop
78 Morton Street and 25 Columbus Avenue (Google Maps, Corcoran) 

Four townhouse deals boost Manhattan’s luxury market

Four townhouse deals boost Manhattan’s luxury market
356 Sackett Street (Google Maps, Elliman)

Brooklyn’s back: Luxury contract volume hits four-month high

Brooklyn’s back: Luxury contract volume hits four-month high
The Hillandale estate (Knight Frank)

260-acre Hillandale estate returns to market asking $49M

260-acre Hillandale estate returns to market asking $49M
arrow_forward_ios

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

Loading...