Luxe gets pinch of reality: A look at Manhattan’s top sales

Financial news has been bleak as of late, with the credit crisis and the collapse of Bear Stearns rocking the real estate world.

Yet while sellers of lower- and mid-priced homes have suffered, some real estate watchdogs maintain that the market for trophy properties has remained insulated from price fluctuations.

Can that hold up with the economy headed downward? This month, The Real Deal set out to get a sense of how the ultra-high-end of the market was faring. We looked at sales of $20 million and over in the first two months of 2008, and compared them to sales in the first two months of 2007. We also gathered data for the top 25 sales between January 2007 and March 10, 2008. Sales ranged in price from $26 million to a record $51.5 million-plus (see chart).

Data show that this top slice of the eight-figure niche is still holding up. The number of these sales doubled in the first two months of 2008 over the first two months of 2007. This January and February, there were 11 closed sales of $20 million and over, compared to five in the first two months of 2007.

Ultra-high-end prices also increased modestly year over year. This year, the average sales price of the top deals increased 5.7 percent, or $1.6 million, to $29.1 million from $27.5 million in 2007.

“When you have the rest of the country in the red, I think it’s pretty impressive,” said Kirk Henckels, an executive vice president and director of Stribling Private Brokerage, the company marketing the Plaza. But, he added, “It’s more the quantity that’s overwhelming.”

Still, there’s a caveat: These closed and recorded transactions culled from the Real Estate Board of New York, Miller Samuel, PropertyShark, city filings and press reports reflect deals negotiated at least several months prior. That means that deals actually done during the beginning of this year in the backwash of the Bear Stearns collapse are not yet in the public record.

Also, the ultra-high-end market did not perform as well as it has in recent times.

In the overall market, the median Manhattan sales price went up 6.4 percent between fourth quarter 2006 and fourth quarter 2007, said appraiser Jonathan Miller, president and CEO of Miller Samuel.

In the luxury slice, defined as the upper 10 percent (which Miller put at transactions with a value of $2.8 million and above), the median sales price increased between fourth quarter 2006 and fourth quarter 2007, a more sizable 28.4 percent.

So the ultra-high-end’s 5.7 percent rise in average price was, in Miller’s view, nothing to celebrate.

“A 5.7 percent change in average price is consistent with the median price of the whole market, rather than the double-digit price growth in the upper end of the market, but we are dealing with a small data set,” said Miller.

The top sale on record in the first two months of this year was $11 million more expensive than the priciest sale in the first two months of last year — $46 million compared to $35 million. The $46 million sale, a record price for a New York City co-op, was for a 17-room, seven-bedroom duplex penthouse at 1060 Fifth Avenue. The buyer was hedge funder Scott Bommer and his wife, Donya, a former television anchor. Brown Harris brokers Fritzi Kallop, John Burger and Mary Rutherfurd represented the seller, poet and writer Georgia Shreve.

The top sale in January and February 2007, in contrast, was a four-story townhouse at 36 East 75th Street, which the Russian Federation purchased for $35 million.

Stribling & Associates started the year off well. The company did 12 co-op sales of $20 million or more — closed or in contract — in January and February, said Henckels. That represents more ultra-high-end co-op sales than the company did in all of 2007.

Kyle Blackmon, a vice president at Brown Harris Stevens who has sold units in the
hyper-elite 15 Central Park West, thinks that this year, the market could be OK despite the economic gloom.

“You’re going to see some major properties closing over $20 million at 15 [Central Park West] in the next four to six months,” he said, basing his opinion on deals in contract. He added his personal take on the Manhattan condo market: “I feel very confident that there will be deals in the $50 [million]-plus range.”

If the Henry T. Sloane Mansion on East 68th Street — a townhouse listed by Brown Harris Stevens senior vice president and managing director Paula Del Nunzio for $64 million — garners its asking price, it would set a new record. This year is certainly on pace to see some eyebrow-raising deals, with four deals at 15 Central Park West around the $50 million market slated to close soon. Brokers are holding out hope that homes could fetch even more than the $50 million.

Using a wider lens

Availability seemed to be the name of the game in Manhattan’s ultra-high-end residential real estate market between the beginning of 2007 and the middle of last month (the most logical cutoff point at press time), with sales at 15 Central Park West dominating the list of closings in the high-end market.

“With luxury apartments, it’s just a matter of what’s available, because they are in such short supply,” said Gregory Heym, executive vice president and chief economist for Terra Holdings, parent company of Brown Harris Stevens and Halstead Property.

Since new development sales close in clusters, it’s logical that there would be a surge in sales at 15 Central Park West between the end of last year and today. The Robert A.M. Stern building accounted for one-quarter of the top 25 closed and recorded deals between January 2007 and the middle of March 2008.

“When there are trophy properties out there, especially 15 [Central Park West], they get snapped up,” said Brown Harris Stevens’ Blackmon, who sold Penthouse 20 at 15 Central Park West to Citigroup chairman emeritus Sanford Weill for $42.4 million. The Weill purchase was the sixth highest-priced sale between January 2007 and mid-March 2008, and the third most expensive in 2007 alone.

Sorted by price, the most desirable properties are still around Central Park and along Park Avenue. Fifth Avenue beat out the other avenues in the number of homes trading hands, claiming seven deals. Next was Central Park West, where there were six deals, all in Arthur and William Zeckendorf’s 15 Central Park West.

There were two exceptions farther Downtown: one at 845 United Nations Plaza for $34.3 million, and the other at 11 West 10th Street, which, at $34.5 million, broke the record for the most expensive residential sale Downtown.

The top publicly recorded sale over the approximately 14-and-a-half-month period was the $51.5 million condo at the Plaza Hotel to developer Harry Macklowe. Including the money he doled out to acquire seven contiguous raw-space units, Macklowe reportedly spent around $60 million, a record residential sale price ($51.5 million was confirmable by looking at public records, and the remaining amount was not; see chart on page 61 for more details).

The other Plaza sale to make the list was the $25.8 million purchase by recently resigned Bear Stearns CEO James Cayne.

The second-priciest sale overall was the $50 million purchase of 15 East 64th Street by Russian oil magnate Leonard Blavatnik. He purchased the 31-foot-wide mansion from Seagram liquor heir and music executive Edgar Bronfman Jr. It was the second-highest price ever paid for a townhouse, behind the $53 million Harkness Mansion purchase in 2006.

Despite the possible recession the country is now in, good properties are getting snapped up.

“In any market, there are properties that are exceptional, and those properties will find buyers who will perceive their value,” said Brown Harris Stevens’ Del Nunzio, who brokered the Harkness Mansion deal as well as the No. 3 deal on the top 25 list, the $49 million sale of the Milbank Mansion at 14-16 East 67th Street, once owned by Penthouse magazine founder Bob Guccione.

Despite so many high-flying sales, Miller of Miller Samuel said there are likely difficulties ahead.

With some prognosticators putting financial sector layoffs at around 20,000 over the next two years, the high end of the real estate market faces difficulties, Miller said.

“Marketing times will expand during this period of uncertainty,” he noted.

Also, sales activity in the overall market is down as of late last month, Miller said, which may soon show up in the data.

“There has been less sales activity so far this year compared to the same point last year,” Miller said.

And it’s only a matter of time until sales prices follow suit.

“There can be a lag time of a year or more,” Miller said, estimating that price depreciation could be evident next year.

Still riding high: The borough’s priciest closed residential sales from the start of 2007 to the present

1. The Plaza Hotel, seventh floor

Condo

Closing date: June 15, 2007

Price: $51,539,180

SF / (PPSF): 9,200 ($5,602)

Selling Broker: Alexa Lambert, head of sales at the Plaza, Stribling & Associates

Listing Broker: Alexa Lambert, head of sales at the Plaza, Stribling & Associates

Seller: Elad Properties

Buyer: Harry Macklowe, developer

Notes: While public records show Harry Macklowe spent $51.5 million buying
at the Plaza, Macklowe may have actually spent closer to $60 million for his pad, paying off buyers in contract so he could have seven contiguous units, according to sources. At $60 million, the purchase would set the record as the priciest residential sale in Manhattan history. The landmark building was built in 1907 and recently went through a $400 million renovation. The 768 Fifth Avenue building is 21 stories, with 178 condos, 130 hotel rooms and 152 hotel-condos.

2. 15 East 64th Street

31-foot-wide townhouse

Closing date: October 15, 2007

Price: $50,000,000

SF / (PPSF): 11,805 ($4,235)

Selling Broker: FSBO

Listing Broker: FSBO

Seller: Edgar Bronfman Jr., Seagram liquor heir and music executive

Buyer: Len Blavatnik, oil magnate

Notes: The mansion, which has a limestone façade, was built in 1900 on a block between Madison and Fifth avenues. It is the second-highest price ever paid for a city townhouse. The first was the $53 million purchase of the Harkness Mansion, a 25,000-square-foot home on East 75th Street, in 2006.

3. 14-16 East 67th Street

48-foot-wide townhouse

Closing date: March 4, 2008

Price: $49,000,000

SF / (PPSF): 22,000 ($2,227)

Selling Broker: Unavailable

Listing Broker: Paula Del Nunzio, Brown Harris Stevens

Seller: Laurus Funds

Buyer: Philip A. Falcone, senior managing director at Harbinger Capital Partners

Notes: With six stories and 27 rooms, the Milbank Mansion is one of Manhattan’s largest private homes. It was once owned by Penthouse magazine founder Bob Guccione. The 22,000-square-foot house was combined from two separate townhouses in 1920 by financier and philanthropist Jeremiah Milbank (he was also affiliated with 11 West 10th Street; see No. 9 in the chart). The house features the original grand ballroom, indoor swimming pool, gymnasium, terraced gardens and Carrara marble staircase.

4. 1060 Fifth Avenue, 13/PHB

Duplex penthouse co-op

Closing date: January 23, 2008

Price: $46,000,000

SF / (PPSF): Unavailable

Selling Broker: Unavailable

Listing Broker: Fritzi Kallop, John Burger, Mary Rutherfurd, Brown Harris Stevens

Seller: Georgia Shreve, poet and writer

Buyer: Scott Bommer, hedge funder, and his wife, Donya, a former TV anchor

Notes: The unit consists of 12 rooms on the 13th floor and five rooms on the 14th floor in the penthouse apartment. There are five master bedrooms and a large family room off the kitchen. Designed by J.E.R. Carpenter in 1929, the building
has a limestone base and a brick Italian Renaissance façade.

5. 15 Central Park West, PH39

Penthouse condo

Closing date: February 6, 2008

Price: $45,000,000

SF / (PPSF): 11,383 ($3,953)

Selling Broker: Unavailable

Listing Broker: Zeckendorf Realty

Seller: Arthur & William Zeckendorf

Buyer: Daniel S. Loeb, founder and head of Third Point hedge fund

Notes: The penthouse unit in the Robert A.M. Stern-designed building has 10,674 square feet with five bedrooms, five full bathrooms and two half bathrooms, and a 709-square-foot terrace. The neoclassical two-wing development (the House building is 20 stories, and the Tower is 43) was developed by Arthur and William Zeckendorf and sold out for around $2 billion.

6. 15 Central Park West, PH20

Penthouse condo

Closing date: August 31, 2007

Price: $42,405,000

SF / (PPSF): 8,821 ($4,807)

Selling Broker: Kyle Blackmon,

Brown Harris Stevens

Listing Broker: Zeckendorf Realty

Seller: Arthur & William Zeckendorf

Buyer: Sanford Weill, ex-CEO of Citigroup, and his wife, Joan

Notes: The penthouse unit has four bedrooms and six-and-a-half baths. It is comprised of 6,744 square feet of indoor space and 2,077 of exterior space, the largest terrace in the building. For building information, see above.

7. 810 Fifth Avenue, 13PH

Duplex penthouse co-op

Closing date: May 2, 2007

Price: $37,842,187

SF / (PPSF): Unavailable

Selling Broker: Unavailable

Listing Broker: Unavailable

Seller: David Geffen, DreamWorks co-founder

Buyer: Peter G. Peterson, Blackstone Group co-founder

Notes: The 12-room duplex penthouse has a private elevator vestibule opening to a square gallery, a curved staircase leading to a reception room with fireplace, a master bedroom with two appointed baths and two dressing rooms. The limestone-clad, Italian Renaissance, palazzo-style apartment building was built in 1926 as a residence for Laurance Rockefeller.

8. 36 East 75th Street

25-foot-wide townhouse

Closing date: January 8, 2008

Price: $35,000,000

SF / (PPSF): 12,000 ($2,917)

Selling Broker: Unavailable

Listing Broker: Brown Harris Stevens

Seller: Dr. Michael Evan Sachs, a plastic surgeon, and Linda Dawson Sachs

Buyer: The Russian Federation

Notes: The entrance to the six-bedroom, four-story, 12,000-square-foot Georgian Mansion is through an iron gate and planted front yard. The building, purchased by Russia for the Russian envoy to the United Nations, was erected in 1893 and acquired in 1915 by R. Horace Gallatin of the New York Historical Society, who altered the façade to its current brick and limestone classic configuration. Habsburg Feldman, a Swiss auction house, occupied it before it became residential again in the early 1990s.

9. 11 West 10th Street

55-foot-wide townhouse

Closing date: March 23, 2007

Price: $34,530,000

SF / (PPSF): 12,774 ($2,703)

Selling Broker: Unavailable

Listing Broker: Debbie Korb,

Sotheby’s International

Seller: Frederick Wilson, blogging venture capitalist

Buyer: Stuart Coleman, co-managing partner at law firm Stroock, Stroock & Lavan and member of its operating executive committee

Notes: The 15,000-square-foot mansion was built as a Greek Revival row house in 1847. Eventually it became the Milbank Memorial Home, and then financier and philanthropist Jeremiah Milbank donated it to the Ladies’ Christian Union in 1918 (Milbank was also affiliated with 14-16 East 67th Street; see No. 3 in the chart). The inside of the house was recently redone by celebrity architect David Piscuskas. The sale broke the record for the most expensive Downtown residential sale ever.

10. 845 United Nations Plaza, 89B

Condo

Closing date: September 19, 2007

Price: $34,268,185

SF / (PPSF): 10,145 ($3,378)

Selling Broker: Debra Stotts, Trump Sales & Leasing

Listing Broker: Trump Sales & Leasing

Seller: 845 UN Limited Partnership

Buyer: CCHP Holdings

Notes: Trump World Tower is located on First Avenue, one block south of 100 United Nations Plaza and to the east of the Japanese Mission to the United Nations. Building amenities include a private driveway on the west side of the property, a private garden for residents and a health club with a 60-foot-long pool.

11. 778 Park Avenue, 3

Co-op

Closing date: January 3, 2008

Price: $33,600,000

SF / (PPSF): 6,000 ($5,600)

Selling Broker: Unavailable

Listing Broker: Deborah Grubman, Carol Cohen, the Corcoran Group

Seller: Vera Wang, designer, and Arthur Becker

Buyer: Mitchell Alan Davidson

Notes: The unit is a third-floor, 6,000-square-foot home with a private elevator landing leading to a marbled entry gallery. The 14-room apartment has six bedrooms, five-and-a-half bathrooms, a grand living room, dining room and library, all three with wood-burning fireplaces. The corner master bedroom, with sitting room, features a bath with double sink, marble tub and shower. Wang sold her apartment in the prewar 18-story building designed by Rosario Candela and moved into her late parents’ duplex at neighboring 740 Park Avenue.

12. 834 Fifth Avenue, 9-10A

Duplex co-op

Closing date: October 30, 2007

Price: $33,444,500

SF / (PPSF): Unavailable

Selling Broker: Unavailable

Listing Broker: Laurence Kaiser, Key Ventures

Seller: Loida N. Lewis, widow of Reginald Lewis, founder of the Beatrice Foods chain

Buyer: Mark Rachesky, chairman of Leap Wireless, and his wife, Jill

Notes: The apartment in the 14-story, 24-unit prewar co-op designed by Rosario Candela has four bedrooms, seven-and-a-half bathrooms and three maid’s rooms.

13. 7 East 67 Street

25-foot-wide townhouse

Closing date: July 26, 2007

Price: $33,000,000

SF / (PPSF): 14,000 ($2,357)

Selling Broker: Unavailable

Listing Broker: Sami Hassoumi, Brown Harris Stevens

Seller: Matthew Bronfman, Seagram heir and real estate developer

Buyer: Charles Murphy, investment banker

Notes: The price for the 25-room house was a record for a townhouse less than 26 feet wide, according to appraiser Jonathan Miller. No Manhattan house of that size had previously closed for more than $30 million. With six levels, the house has a sweeping staircase, four-story glass atrium, several wood-burning fireplaces and a basement with gym, sauna and bath. The landmarked mansion was built in 1890 and went through a complete renovation between 1994 and 1997.

14. 740 Park Avenue, 4/5A

Duplex co-op

Closing date: January 29, 2008

Price: $32,000,000

SF / (PPSF): Unavailable

Selling Broker: FSBO

Listing Broker: FSBO

Seller: Estate of Janet Coleman

Buyer: David and Tamara Winn

Notes: The 14-room duplex is in a 35-unit building erected in 1930 and converted to a co-op in 1953.

15. 15 Central Park West, 16/17D

Duplex condo

Closing date: December 14, 2007

Price: $29,529,250

SF / (PPSF): 7,259 ($4,068)

Selling Broker: Unavailable

Listing Broker: Zeckendorf Realty

Seller: Arthur & William Zeckendorf

Buyer: Pantigo LLC

Notes: The 6,131-square-foot duplex has four bedrooms and six-and-a-half bathrooms, plus a 1,128-square-foot terrace. For building information, see above.

16. 15 Central Park West, 16/17C

Condo

Closing date: February 26, 2008

Price: $29,500,000

SF / (PPSF): 5,821 ($5,068)

Selling Broker: Unavailable

Listing Broker: Zeckendorf Realty

Seller: Arthur & William Zeckendorf

Buyer: Omid Kordestani, Google’s senior vice president of global sales and business development

Notes: Kordestani bought unit 16-17C, a four-bedroom, 5,416-square-foot unit with a 405-square-foot terrace. For building information, see above.

17. 4 East 66th Street, fifth floor

Co-op

Closing date: June 21, 2007

Price: $29,000,000

SF / (PPSF): Unavailable

Selling Broker: Unavailable

Listing Broker: Edward Lee Cave

Seller: Robert H. Burns, Regency Hotel chain founder

Buyer: Daniel L. Nir, Gracie Capital hedge fund manager, and his wife, Jill Braufman

Notes: The apartment with private elevator occupies the entire fifth floor in the limestone-clad co-op. There are only 17 apartments in the 12-story building, completed in 1920. The apartments have ceilings of 11 to 13 feet and two large, equally sized entertaining rooms that take up the entire Fifth Avenue frontage overlooking Central Park. The building, which is also known as 845 Fifth Avenue, was designed by J. E. R. Carpenter for William Henry Barnum.

18. The Plaza Hotel, 1407 and 1408

Condo

Closing date: February 15, 2008, and February 28, 2008

Price: $27,667,230

SF / (PPSF): Unavailable

Selling Broker: Alexa Lambert, Stribling & Associates

Listing Broker: Alexa Lambert, Stribling & Associates

Seller: Elad Properties

Buyer: James Cayne, recently resigned chief of Bear Stearns, and his wife, Patricia Denner Cayne

Notes: James Cayne bought two condos on the 14th floor at the Plaza at 768 Fifth Avenue. On February 15, he bought unit 1408 for $2,422,671, and 13 days later, he purchased unit 1407 for $25,244,559. For building information, see above.

19. (tie) 778 Park Avenue, 14

Co-op

Closing date: December 3, 2007

Price: $27,500,000

SF / (PPSF): Unavailable

Selling Broker: Unavailable

Listing Broker: Unavailable

Seller: Sherman Cohen

Buyer: William P. Lauder, Estée Lauder CEO and president, son of Leonard Lauder and grandson of matriarch Estée

Notes: The English Renaissance 14-room apartment occupying the entire 14th floor was designed by Rosario Candela. The apartment has five bedrooms, seven-and-a-half baths, wood-burning fireplaces and three terraces. For building information, see above.

19. (tie) 998 Fifth Avenue, 4W

Co-op

Closing date: January 17, 2007

Price: $27,500,000

SF / (PPSF): Unavailable

Selling Broker: Unavailable

Listing Broker: Kathy Sloane, Brown Harris Stevens

Seller: Peter and Charlotte Schoenfeld

Buyer: Russian oil magnate Leonard Blavatnik and his wife, Emily

Notes: The apartment includes three entertaining rooms overlooking Fifth Avenue with views of the Metropolitan Museum of Art. The limestone building at 81st Street has 18 apartments on 12 floors. It was designed by McKim, Mead & White in 1912 for the developer James T. Lee, grandfather of Jacqueline Kennedy Onassis. The building was converted to a co-op in 1953.

21. (tie) 834 Fifth Avenue, 9B

Co-op

Closing date: May 2007

Price: $27,000,000