A match-up of Manhattan developments like One57 and 56 Leonard and the buildings they’re replacing
What’s in vogue one moment is often passé the next — a maxim that holds true for luxury real estate.
The gleaming towers that are now in fashion in Manhattan are edging out yesterday’s “it” buildings, attracting the high-end buyers who might otherwise have bought their predecessors, even when those “old” buildings debuted relatively recently.
Which new developments are taking place of the old?
This month, The Real Deal paired five new Manhattan construction projects with headline-generating buildings of 15 years vintage or less. Purely by being new, the latest projects can boast advantages like fresh finishes and more built-in technology. And in the eyes of a buyer, newer often equates to better.
“Developers can make the new model even better based on what they know to be successful,” said Douglas Elliman broker Jessica Cohen, who has sold properties in several of the buildings on TRD’s list.
To be sure, there are still plenty of deep-pocketed potential buyers for these “old” properties. Some might opt to purchase a resale because they can pay a lower price, for example, or to avoid waiting years for construction to be complete, brokers said.
“The older buildings will also attract wealthy buyers, but those buyers are more likely to not be concerned with having the most sparkly thing on the block,” said Sofia Song, head of research and external affairs at the brokerage Urban Compass.
The increased competition that brand-new buildings pose to their slightly older counterparts means it is taking longer for resale sellers (and their brokers) to unload units than they expect, said Jonathan Miller of real estate appraisal firm Miller Samuel.
In addition, luxury resales are not seeing quite as astronomical a shift toward higher prices as the luxury new developments, according to Miller’s data. In 2014’s first quarter, the median price of luxury new development units rose 73 percent year-over-year, to $9.6 million. On the luxury resale side, meanwhile, the median price was up 39 percent year-over-year to $5.3 million, according to the data.
“The challenge for older buildings is to look at their own identity,” said Town Residential broker Michelle Evi Bourgeois, who recently represented a buyer that went into contract for a $16.6 million unit at 551 West 21st Street, the under-construction, Norman Foster–designed Chelsea condo. “The management team should consider upgrading the lobby, the hallways and amenity spaces; make sure the doorman stands up straight; and consider rebranding. These things give the crucial first impression.”
Not every 2000s-era super-luxury property has an immediate heir, at least not yet. The Zeckendorfs’ 15 Central Park West, for example, dominated the real estate headlines from 2007 to 2012, but it does not yet have a clear replacement building. Some point to One57 as the logical successor, but the Robert A.M. Stern-designed showpiece might also get some competition from another new work from the starchictect: Vornado Realty Trust’s 100-unit 220 Central Park South, which is slated to be one of the tallest residential buildings in the city at 1,031 feet when it opens in 2016. Pricing for the apartments is not yet available.
Below are the match-ups making waves today.
One57 vs. Time Warner Center
While many consider One57 to be the prime successor to 15 Central Park West, sources told TRD that its most direct elder rival might be the Time Warner Center, based on sheer proximity. Extell’s 90-story, 57th-Street skyscraper is rising just blocks from Related Companies’ twin 80-story Time Warner Center, which opened at Columbus Circle in 2004.
Four times between 2003 and 2009, the city’s priciest condo sale of the year was at the Time Warner Center, including a $43 million sale in 2003.
But the building hasn’t claimed the priciest sale in the city in four years. Meanwhile, the 94-unit One57 — which launched sales in 2011 and is expected to open later this year — has two units in contract for more than $90 million, which would be a New York City condo-sale record.
Some Time Warner Center owners may even be trading up into One57. Last month, a couple who lives on the 69th floor of the Time Warner Center’s Mandarin Oriental hotel paid $19.1 million for a condo on the 50th floor of One57, property records show. Yu-Ting and Yu-Wen Huang declined to comment on whether they plan to unload their Time Warner pad. Corcoran Group broker Carrie Chiang, who represented the Huangs in their Mandarin Oriental purchase, declined to comment about whether they plan to list their current home.
A change in developers’ tactics in recent years may also be drawing high-end buyers to new buildings like One57.
Nikki Field of Sotheby’s International Realty said several of her clients residing at the Time Warner Center, as well as across the street at Trump International Hotel & Tower and 15 Central Park West, have opted to upgrade to One57. When those older buildings arrived on the scene, many buyers expected to replace all the finishes, she said.
“Developers delivered moderate quality and low-cost finishes with the understanding that they would be replaced with personalized finishes,” Field said. But now, “in this era of 2014 billionaire buildings, purchasers often do not have the time and patience to rebuild a new home. Few will tolerate another year of customization time and they expect, demand and are paying for high-quality finishes.”
There are other factors as well. The Time Warner Center offers amenities shared by both the guests at the Mandarin Oriental and the condo owners, whereas at One57 residents will have access to a 20,000-square-foot amenities floor (including a 65-foot pool and aquarium), separate from the niceties available to guests at the building’s Park Hyatt hotel, said Elliman broker Toni Haber, who has sold units in some of the city’s toniest buildings.
Still, brokers say the Time Warner Center has several key features that will ensure it doesn’t lose its luster among über-wealthy buyers, such as its south-facing views and smaller floor plans.
“A lot of buildings [like One57 or 432 Park] are not making the two-bedrooms or smaller units available that you do find at Time Warner,” said Brown Harris Stevens broker Kathy Sloane.
In addition, in 2011, Related revamped the four-story indoor mall portion of Time Warner.
Haber said resales at the Time Warner Center are “doing fantastic.” A five-bedroom condo sold for $30 million in March, while a three-bedroom closed for $15 million in April, according to StreetEasy.
56 Leonard vs. 101 Warren Street
Only a few years apart, these Tribeca condo buildings both made a splash when they debuted.
Developer Edward Minskoff’s 101 Warren Street raked in $650 million in sales, selling out in 2010 after four years on the market. The 227-unit, 35-story property sits at the heart of a 1-million-square-foot mixed-use complex.
But there’s a new shiny tower in the neighborhood.
And 56 Leonard, a 145-unit, 60-story structure by Alexico Group and Hines, is the tallest residential building in Tribeca. Slated to open in 2016, the building set a then-Downtown record when an unidentified New York-based hedge-fund manager went into contract for a $47 million penthouse, the Wall Street Journal reported.
“They have practically the same absorption rate,” Miller said, referring to the buildings’ respective sales. “When 101 Warren came online, it was one of the big success stories. It was well received as the new product in that location.”
Elliman’s Haber said 101 Warren was a “pioneer in its day.” But, she said, its views can’t compare to those at 56 Leonard, which is nearly twice the height.
Sales at 101 Warren have tamped down in the years since its heyday. In fact, of 11 active or in-contract listings on StreetEasy, six show price cuts, including the 5,769-square-foot duplex now offered for $30 million, a 14 percent drop from its original listing in August for $35 million.
Haber said 56 Leonard feels more exclusive, in that all units are condos and feature a private terrace. At 101 Warren, there is a 132-unit rental component as well as shared amenity spaces, which Haber said tends to be a turn-off to the super rich. It does, however, have floor-to-ceiling windows and views of the Hudson River.
But what cements 56 Leonard as the superior property, brokers said, is its Jenga-shaped, glassy design from Pritzker Prize-winning duo Herzog & de Meuron.
551 West 21st Street vs. 100 11th Avenue
Both of these angular, glass Chelsea condos were also born from the eye of a Pritzker Prize-winning starchitect.
French architect Jean Nouvel designed the Cape Advisors-developed 100 11th Avenue, while Foster is behind 551 West 21st Street, which is being developed by real estate scion Scott Resnick.
The condos are both located on the West Side Highway, roughly two blocks apart.
Sales launched at the Foster building earlier this year, about seven years after the debut of the Nouvel tower, where the priciest unit sold for $19.75 million, records show.
The top penthouse at the newer project, which has its own swimming pool on a 4,000 square-foot rooftop terrace, hit the market in April for $50 million. Buyers are drawn to the 11-foot-high ceilings, 34-foot-high lobby and gated car entry, brokers said. In addition, Foster designed both the exterior and the interior of the building.
Town’s Bourgeois also pointed to the storm-resistant design as setting 551 West 21st Street apart from 100 11th Avenue. A gas-powered, rooftop emergency generator and metal barriers at the entrances are designed to protect the structure from damage in future storms, given its proximity to the Hudson River.
“It would cost a lot to retrofit something like that,” Bourgeois said, referring to properties built before Hurricane Sandy that lack similar fortification.
In addition to being the latest buzzworthy building in the area, the newer tower has a distinct leg up on its older competitor. While 100 11th Avenue sold out in 2011, it has taken heat for a slew of problems, including drainage issues connected to its iconic multi-colored mosaic glass façade and alleged inferior construction. A buyer who went into contract for a $24.5 million duplex in 2007 requested that the deposit be returned, alleging that the ceiling heights were 9.4 feet instead of the 11 feet they were promised. And Nouvel himself has publicly said that cost cutting by the developers went “off course.”
18 Gramercy Park vs. 50 Gramercy Park North
When it comes to floor plans and interior design, these Gramercy Park properties — located one street apart between Park and Lexington avenues — do not have much in common. But brokers say given their locations, high-profile developers and price points, they are playing in the same space.
Both have 40 feet of frontage on Manhattan’s only private park, and come with coveted keys to the exclusive oasis.
“They’re extremely different products, but they’re both the highest-priced on Gramercy Park,” Miller said. “They represent two different development boom eras.”
Ian Schrager’s 50 Gramercy Park North launched sales in 2005, following a revamp of the stately 1925 landmark. It is the residential component of the Gramercy Park Hotel, the interiors of which artist and filmmaker Julian Schnabel helped design.
Most of the apartments feature a fireplace and 12-foot ceilings, along with views of the park.
The 17-story building is a condop sitting on leased ground — which therefore results in higher-than-normal monthly maintenance fees. John Burger of Brown Harris Stevens, one of the city’s top brokers, said he generally advises clients to avoid land-lease buildings because they have limited appreciation.
Still, a three-bedroom penthouse in the building sold for $22 million in 2011, breaking a record at the time for priciest-ever sale of a home abutting the park, StreetEasy records show. The apartment was most recently listed for $14.9 million in 2013, but is no longer on the market and has not been sold, according to StreetEasy and property records.
In addition, actress Jennifer Aniston bought a three-bedroom there for $9 million.
Meanwhile, the Zeckendorfs’ posh new 18 Gramercy Park, an 18-story condo converted from 200 studio apartments, was designed by Stern and launched sales last year. A $42 million penthouse set a then-record for the most expensive condo Downtown when it sold to Houston Rockets owner Leslie Alexander. (The current record for a Downtown condo was set by Walker Tower in Chelsea when a unit there sold for $50.9 million.)
Unlike 50 Gramercy Park North, 18 Gramercy features all full-floor units and is on the comparatively quieter south side of the park, said Burger, who represented former New Jersey Governor Jon Corzine’s ex-wife in her purchase of a $16.6 million sponsor unit at 18 Gramercy Park last year.
Most of the apartments have four bedrooms and span at least 4,200 square feet. Asking prices range from $9 million to $18 million. Each unit also features about 2,000 square feet of terrace space.
One Riverside Park vs. the Avery
Extell is going head-to-head with, well, Extell on the Upper West Side.
The prolific developer is behind both buildings in TRD’s final match-up: The Avery, which it sold out in 2006, and One Riverside Park, which it launched last year.
Units at the 32-story Avery, a 274-unit tower at 100 Riverside Boulevard, had an average sales price of $1,350 per square foot when the building sold out, according to news reports. The property has drawn buyers for its in-house theater, parking garage, library and private courtyard.
The Avery was Extell’s first building along Riverside Boulevard. The developer is also responsible for other nearby condos such as the Rushmore and the Aldyn, which fetched similar prices.
Now, the developer is aiming to out-Extell itself.
The first batch of the 219 units at the 35-story One Riverside Park hit the market last year, until Extell chief Gary Barnett halted further sales pending an upward price adjustment. Average asking prices there exceed $2,000 per square foot.
Over eight years, Extell has evolved further and learned what worked and what did not, said Urban Compass’ Song. The new building offers access to 40,000 square feet of amenities, a glassier exterior and “more generous” room sizes than the Avery does, she said.
“The Avery pushed the envelope at the time, with respect to pricing,” Miller said. “It was a hot building, while One Riverside Park is something new that hopes to be hot.”