East Harlem becomes developers’ new favorite turf

Nov.November 28, 2007 07:43 PM

Rising land prices in East Harlem are prompting developers to direct their energies away from building run-of-the-mill rental apartments and into creating elegant condominiums and co-ops.

The area between 96th and 135th streets from Fifth Avenue to the East River is being seen as fertile ground, transcending its reputation as a down-at-the-heel neighborhood. Over the past year, a hefty handful of luxury rental and condo buildings have been calming the choppy waters in the neighborhood.

One of the latest to go to market is Senneca Terrace at 324 East 112th Street between First and Second avenues. A brand-new elevator building, it has three duplex townhouses at the base, and 15 one- and two-bedroom apartments topped by two penthouses. As its name suggests, balconies are abundant.

“The nicest thing about this development is all the two-bedrooms have two sets of terraces one on the back and one on the front so they’re very light apartments,” said marketing broker Valerie Dominguez of the Corcoran Group.

While one-bedroom condos don’t have terraces, the 1,300-square-foot townhouses have private gardens, and the 1,150-square-foot penthouses have two terraces plus private roof decks.

Senneca Terrace’s developer, CGS Builders, chose to go all out on balconies and luxury finishes, including washer-dryer hookups in each condo, but decided against a doorman to keep amenity fees low. A tax abatement means minimal taxes initially as low as $10 a month while maintenance fees are about $250 a month for a 611-square-foot one-bedroom and $400 for a 1,073-square-foot two-bedroom.

Prices are being set at about $600 a square foot.

On the heels of this residential growth, a Marriott hotel will soon tower 34 stories above 125th Street and Park Avenue. Retail development is occurring between 111th and 116th streets below the Metro North train tracks.

While residential rental and sales prices don’t come close to rivaling those of the Upper East Side, its posh neighbor to the south, East Harlem’s prices are ticking up a bit. Rao’s City Views, a deluxe rental development above the iconic Rao’s restaurant at 455 East 114th Street and Pleasant Avenue, is asking as much as $6,000 for a two-bedroom unit.

“It sounds shocking, but they’re going,” she said, though as of early July, 19 of the 22 units were still listed on the Corcoran Web site.

And development isn’t limited to the area closer to 96th Street, the generally accepted southern boundary of East Harlem.

Prudential Douglas Elliman is successfully marketing The Walden at 69 East 130th Street between Park and Madison. The doorman building’s 25 condos have the upscale finishes of Senneca Terrace, but no washer-dryer hookups or individual terraces.

Another East 130th Street development is 2119 Fifth Avenue, a brownstone and brick former rooming house converted to four condos that sold in the third quarter of 2004 for $425 a foot.

That’s “proof that the Harlem area has demand for this type of product, not only in places below 125th Street,” said Shimon Shkury, a partner at Massey Knakal.

Another test of the market has been 1400 Fifth Avenue at 115th Street, 129 condos in a green building with West African themes largely set aside for middle-income families. Most of the units remaining are three-story, four-bedroom luxury townhouses listed at market rates. Prices are along the lines of $1.7 million, Dominguez said.

Developers are finding themselves moving away from rentals.

Recently, Massey Knakal got $250 a buildable square foot almost double the asking price for a client selling a vacant lot at 110 East 97th Street between Park and Lexington. Condos are planned.

“Manhattan has no other way to grow but north,” Shkury said. “East Harlem, particularly below 112th Street, is becoming the natural extension of the Upper East Side.”


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