Economist Adam Smith once said, “All money is a matter of belief.”
While faith is a big component of the economy, it is not everything. Underlying value in the marketplace is also important, and on that front, New York City is doing just fine. It’s a fact that can be reassuring during these uncertain times, when many don’t know what to think or what to believe.
New York enjoys several special advantages. It is not just the capital of the business world, but also of art, publishing and fashion. While firms on Wall Street— considered the city’s powerhouse industry—cut about 6,000 jobs in the city last year, these other sectors and the raw talent they attract will help cushion the blow. After all, as bad as some may think things are, we are not seeing anything like the financial havoc of the early ’90s.
Still, we are seeing the impact of the credit crunch crisis on some real estate markets here.
To give you a sense of how the city is faring and how the boroughs stack up against one another, this month we present a comparative analysis looking at indicators like office vacancies, new condo development, foreclosures, building sales and much more. To take one example, many won’t find it surprising that Brooklyn’s real estate activity is robust and that price points in Northern Brooklyn are holding their value nicely and competing with parts of Manhattan. But there are surprises, like the fact that Queens has seen the smallest drop-off in condos entering the development pipeline among the five boroughs in the past year.
This month we also bring you an exclusive story about disgraced media mogul Lord Conrad Black. Lord Black’s spectacular fall from grace involves several plot twists and trips to the courthouse (and soon, jail). One of these twists involves his real estate broker, Patricia Patterson of Sotheby’s International. Ms. Patterson was a long-time acquaintance of Lord Black and his wife, but when Black’s apartment sale turned sour, so did their relationship. Our story examines the lawsuit over the commission on Black’s Park Avenue pad and some never-before-seen court deposition highlights.
On a separate note, for the last several months Harry Macklowe has been under a magnifying lens. The media, including us, played out every possible scenario in which he could default and what could happen as result of the titan being swept off his high perch following his aggressive building purchases. A few weeks before the first big debt payment on his $7 billion dollar portfolio was due, Macklowe reached a deal with Deutsche Bank and will hand over control of the seven office buildings he acquired about a year ago. While Macklowe didn’t fall the way most predicted, some were surprised he didn’t fight harder to retain control of the buildings.
I’m also pleased to present you this month with our Data Book 2008, the most comprehensive resource for information about New York City real estate. It’s been referred to as the annual almanac of New York City real estate, with every piece of data researched, compiled and organized for your edification. You can be sure our annual Data Book is found on the desks of real estate professionals and investors throughout the city, throughout the year, until our next edition comes out to replace it.
The Real Deal is also happy to announce that it has launched another edition of the magazine: The Real Deal South Florida. Because we are committed to bringing you the best real estate news, we are excited to be covering Miami as it goes through a challenging time. The connections between New York and Miami are undeniable. If you are interested in that part of the country, I recommend you subscribe to that edition as well at miami.therealdeal.com
Finally, I’d like to acknowledge the fine work our researchers and editors did on last month’s special report, the Records of 2007. In a compliment to our research department, some people who had broken records did not realize they had until they read it inside our pages.
Enjoy the issue,
Amir Korangy