Buyers Looking For Luxury In Global Pandemic

With New York City in lockdown, home showings banned and a swell of new virus cases, the real estate industry is struggling to come to terms with a new way of doing business.

But in Manhattan, deals are still being done.

There were 14 contracts signed last week for properties above $4 million, according to the latest market report from Olshan Realty. Broken down, that was 10 condos, three townhouses and one co-op — with a combined asking value of almost $91 million.

The figure is relatively strong given the climate in New York. Last week, major brokerage firms across the country shut their offices and moved their operations online as they struggled to adapt to the fast-moving pandemic. On Friday, Gov. Andrew Cuomo ordered workers at all non-essential businesses to stay at home, which effectively put an end to in-person home showings (and the debate about whether they should continue).

Donna Olshan, CEO of Olshan Realty and author of the report, said last week represented the tail-end of the people looking at properties in person, while next week will be more of a gamble.

“I have no expectation moving forward because I’ve never lived in a pandemic and I’ve never seen anything like this,” she said. But, she added, “every single thing can sell. It’s just a function of price.”

The No. 1 contract last week was for a 20.5-foot-wide townhouse at 40 Gramercy Park North, which was asking $12.995 million — down from $14.95 million when it was listed last January. At 7,200 square feet, the five-story home — one of only a few single-family homes on Gramercy Park — has six bedrooms, six bathrooms and six fireplaces.

The second-priciest signing was for a fifth-floor apartment at the BKSK-designed condominium at 601 Washington Street. The 3,000 square-foot apartment has 3 bedrooms and 3.5 bathrooms. It went into contract asking $8.85 million. That unit hit the market last week.

While price discounts have become a hallmark in the luxury market, which is struggling with a glut of unsold inventory, the average price discount from original to asking last week was just 5 percent. Olshan noted that five of the units were developer-owned, and it was impossible to know what the final closing price was — with discounts included — when a deal was only in contract. Some of the units also spent relatively short periods of time on the market.

While the final total was strong, the pandemic has also curtailed several deals, Olshan said.

“I think if we hadn’t had corona, we would have been solidly in the 20s,” she said. “The market was trying to recover and then it got slammed down by the virus.”

“It really was trying to come back — slowly.”

Write to Sylvia Varnham O’Regan at so@therealdeal.com