Asbury Park is set to receive $6M condos. Is the sleepy beach town ready for them?

In Asbury Park, New Jersey, the oceanside town known for Bruce Springsteen and good surf, a developer is betting he can sell $6 million condominiums in a place that still has a high poverty rate and low median house price.

Jay Sugarman, who leads the New York-based real estate investment trust iStar, has bought 35 acres of land in the town, and is planning a $1 billion redevelopment there, with up to 20 new projects to be built over the next decade, according to The Wall Street Journal.

One of those towers, the 17-story Asbury Ocean Club, is set to open in the summer. Its 130 residential condominiums are priced from $1 million to $6 million and will feature a spa and terraces.

Whether these price points are achievable remains to be seen. While Asbury Park has undergone significant redevelopment over the past decade, it still has a high poverty rate, and its median house price hovers around $362,000, according to Zillow.

The demand for luxury residential condos may be premature, as an oversupply exists in Manhattan, which has recorded a steady decline in sales over the past three years.

iStar, which is developing in Coney Island and also recently bought an office tower in Jersey City, has reportedly spent $300 million in Asbury Park on a hotel and a renewed bowling alley with an attached music venue. But some residents feel sidelined by the glitzy redevelopment, which includes a members-only beach club.

“We’re saying create this economic driver, bring those tax revenues to the town,” Sugarman told the Journal. “Then you have a suite of options to play with that you didn’t have before.” [WSJ] — David Jeans