It’s very fancy on old Delancey Street, you know — or so the song goes. In reality, however, Delancey Street (which nowadays serves as something of a dividing line between Chinatown and the Lower East Side) hasn’t been all that fancy. But it’s getting there.
Delancey runs for about 14 blocks between the entrance to the Williamsburg Bridge on the east and the Bowery to the west, and new developments are starting to sprout amidst the
thoroughfare’s mish-mash of discount stores, 19th century buildings and fast-food restaurants. As the patina of cool surrounding the Lower East Side envelops Delancey, the street appears to be moving toward a new identity and luring new, more upscale residents.
Barrie Mandel, a senior vice president at the Corcoran Group who led sales for Blue Condominium at 105 Norfolk, a high-end development just off Delancey, thinks the types of buyers attracted to the glassy tower typify the changing face of the area.
“People attracted to the Blue were interested in living in the neighborhood, but they weren’t interested in living in one of the rundown, tenement-style buildings,” said Mandel. “I think Lower East Side buyers are looking for the new, interesting thing, but they also want to have a place to get a cup of coffee and a bank to go to. That piece of the neighborhood is getting more interesting and a better place to be.”
Mandel noted that Blue, where buyers moved in more than a year ago, was the first high-end doorman condo in the immediate area. The development’s final two units — a 2,494-square-foot penthouse listed at $3.475 million and a 15th-floor duplex priced at $2.425 million — were recently completed and put on the market.
“It’s very interesting going back to the Blue now, a year after people have moved in,” said Mandel. “The people who live there are mostly businesspeople … in the morning you see them leaving the building in their business clothing, and then at night you see them leaving the building again in hipster clothing, and they’re going out to clubs or places like the Mercury Lounge.”
Mandel noted Blue’s buyers see themselves as trailblazers. “I think people in Blue are going to be very annoyed when other buildings get finished and they’re not the only ones in the neighborhood,” she said.
Some of that annoyance may come from a new 16-story condo rising at 38 Delancey. Lee Yan, who is developing the 56-unit condo, said his project, which will include three floors of commercial space, will contribute to higher-quality housing in the area.
“Every day, the Lower East Side changes,” said Yan, whose family has owned a cookware and metal supply business on Chrystie Street for 30 years. “We’re building because people want to live here.”
Yan said 38 Delancey is on track to be completed by June 2009, and that his
target buyers are young families.
Farther down the street, another project under construction will cater to an even younger demographic. Developer Charles Blaichman is building a 20-story tower at Delancey and Ludlow that will be leased to the School of Visual Arts and used as a residence hall for the next 20 years.
The building will include 353 beds,
and Bank of America will be one of the ground-floor retail tenants, according to Michael Grant, SVA’s assistant director of communication.
Grant said the school expects to move into the building this fall, but it’s still
unclear when the development will be ready for students to move in. The dorm will
provide the school with much-needed student housing.
“With this new hall, SVA will have 1,400 beds, which can serve about 40 percent of our students,” said Grant. “It’s great for our students because you can only imagine how difficult it is for someone to move to New York to go to college and then try to deal with the city’s real estate market.”
Beyond that, Grant noted that SVA as an institution is clearly aware of the real estate pressures in Manhattan. “We’re just like everyone else,” he said. “We wanted to get in somewhere before everything else was gone.”
Part of Delancey’s appeal right now, in fact, is that it’s an alternative to everything else, particularly Uptown and Brooklyn, according to Iris Shorin, an associate broker with DJK Residential who often brings potential buyers to Lower East Side properties.
“People who don’t want to go to Williamsburg, they’d rather be on Delancey Street,” said Shorin. “Same for buyers who don’t want to go to Harlem. I see it going where basically every other neighborhood has gone. It appeals to people who want a Manhattan, not a Brooklyn, address, and also people who are priced out of Tribeca or Soho, or who are looking for an alternative to the East Village or Chinatown.”
At the end of the day, buyers are “banking on gentrification,” said Shorin.
Delancey’s “potential” inspired Philip Chong, who has developed projects like 135 Division Street and 23 Greene Street, to build River Ridge, a 46-unit condo at Ridge Street and Delancey, according to Kathy Tsao, the Prudential Douglas Elliman broker who’s marketing the property. Most units at River Ridge are asking between $900 and $1,000 a square foot. The development went on the market in late December, and as of mid-February, five contracts had been executed and another five were in the offering.
Tsao said the condo is mostly attracting first-time homebuyers who believe in the neighborhood’s potential.
“Buyers are interested in the vibrancy of the neighborhood,” said Tsao. “It’s a multicultural neighborhood with a lot of energy and excitement, and there is a lot to do and see in the neighborhood.”
Tsao said she and Chong “think the future of Delancey is going to be fabulous. In the near future, we believe this will be an extension of the Village and Soho.”
Delancey’s transformation into a strip that’s held in the same regard as the Village or Soho will likely hinge at least in part on new and more varied retail coming into the street. Because Delancey is a wide street, it’s potentially attractive to larger retailers.
As it stands now, there are several bank branches on the strip as well as fast-food restaurants like McDonald’s and a Starbucks. There are also new higher-end establishments on side streets off Delancey, like Nurse Bettie, a recently opened bar, on Norfolk; a mixture of vendors at the Essex Street Market, including merchants who sell kosher products and vendors hawking gourmet food like artisanal cheese; and a couple of bar/venue spaces that draw crowds, including the Bowery Ballroom at 6 Delancey.
As Roberto Ragone, the executive director of the Lower East Side’s business improvement district, sees it, the key question for Delancey is where strategic anchor stores should go.
“The national chains and franchises that have gone into Delancey in the past might have been playing it safe,” said Ragone. “The BID would like to see new retail that encourages foot traffic. Hypothetically, something like a Barnes & Noble could complement other things on the strip, especially with the SVA dorm coming.”
Delancey is also named as a street primed to become
a cultural and tourist hotspot in the state’s Empire Zone development plan for Chinatown and the Lower East
Side. The program uses tax incentives to help attract new business.
Luring tourists would bring more people to the neighborhood during the day, noted Ragone, which would further transform the area.
“The Lower East Side has flourished as a nighttime destination in recent years, but it’s still struggling as a daytime destination,” he said.