Extell Development, a leader in setting the bar for luxury prices, is offering discounts of up to 20 percent on all remaining units at its One Manhattan Square condominium.
In a statement Thursday, the New York developer said the decision to slash prices was made “in response to global conditions related to COVID-19.”
It’s the latest in a series of offers designed to spur sales at the 815-unit tower, which was grappling with a soft luxury market well before the pandemic hit. Last April, the developer said it would waive common charges for up to a decade — an unprecedented move, even in a concession-heavy market. Later, it introduced a “rent-to-own” program.
It’s unclear how many units will be subject to the latest discounts, however an analysis from January showed that at that time, 223 of the building’s 815 units had been sold, 39 were in contract and 553 were unsold. (A spokesperson for Extell declined to provide more up-to-date figures.)
The pandemic and ensuing shutdown have taken a huge toll on Manhattan’s luxury market, compounding existing problems and creating even more headaches for developers looking to offload a glut of unsold inventory.
To keep deals moving, brokers across the city have hastily shifted their operations online, conducting meetings on Zoom and showing properties virtually — the closest thing buyers can get to a look inside from the confines of lockdown.
Still, millions of dollars can be difficult to part with in a turbulent economy — particularly when you can’t see a property in person — and new contracts in the luxury market have been slow.
Extell is hoping price drops will prove a circuit breaker.
“While we have adapted to selling our residences through a virtual sales experience, we recognize that it is also important to incentivize our buyers with this program,” Extell’s founder and chairman, Gary Barnett, said in a statement Thursday. “Combined with low interest rates and a 20-year tax abatement, we feel this will make for a very compelling offering.”
The tower is currently advertising prices ranging from a one-bedroom unit asking $1.2 million to a three-bedroom unit asking $7.8 million. According to a 2019 TRD analysis of sales at the building, the average price of units that have closed is $1.7 million. The building has a projected sellout of $1.9 billion.
Last August, Extell secured $690 million in refinancing from the Blackstone Group for the remainder of the tower. The package included a $553.5 million senior inventory loan.
Write to Sylvia Varnham O’regan at [email protected]