I’m hearing a common refrain these days when talking to industry leaders: While there’s concern about the downturn, these folks at the top haven’t been personally affected.
That’s because units are still being sold, although buyers appear to be gaining some bargaining power in the city with a slowdown in sales volume and a noticeable dip in prices this winter. While the residential market has been cyclical for the last decade, this spring will be the real test.
As for the commercial market, it has seen such wild rides in the last several years, with rents reaching as high as $225 per square foot during the recent boom, that some stabilizing might actually be beneficial.
Beyond the city, though, it’s a different story. Across the country, escalating foreclosure rates and growing inventory are dominating headlines. While dramatic, these are not necessarily New York-specific stories, though foreclosures are admittedly rising at alarming rates in some outer-borough areas. The result is tumbling consumer confidence, which further exacerbates economic problems.
But, as usual, New York isn’t following the national playbook.
One of the things that makes New York City, and Manhattan, in particular, so special is its retail — and retail here is very healthy, at least for now, thanks to the city’s concentration of wealthy residents and crowds of tourists eager to spend. This month, in a special report, we take a look at what’s in store for retailers.
Luxury retailing in the city still appears to be as strong as platinum. Case in point is the opening last month of Gucci’s new 46,000-square-foot flagship on Fifth Avenue, the most expensive build-out of retail space on record and a lease that sets a new rent benchmark for boutiques in the city.
Also on the subject of pricey property: the Zeckendorfs’ 15 Central Park West project has tremendous cachet, as demonstrated by the A-listers who have bought into the extravagant building, which has unusual amenities like a private dining room for 60 guests and a professional kitchen with a full-time private chef. This month we bring you a breakdown of the buyers: a veritable who’s who of the upper stratospheres of finance, media, sports, business, entertainment and a few other very rich people.
This month we also break down what went wrong with the conversion of the Manhattan House. The massive $1.1 billion project saw a split between developers Richard Kalikow and Jeremiah O’Connor that hinged on differing visions for the priciest conversion project in the city. One wanted to keep costs down to turn profits, the other wanted to spend more for a more drastic overhaul of the building. Now that Kalikow is out of the picture and sales are underway, observers are waiting to see if the project will be deemed a success.
Finally, we are changing The Real Deal’s annual forum this year from spring to autumn. Why? Well, for a split second we considered moving the venue from Lincoln Center to the Hilton, then decided that our audience required a more distinguished space. So in order to have the same quality experience, the event will be pushed back to September 10th, to be held at Avery Fisher Hall again. More details to follow soon.
Enjoy the issue,
Amir Korangy