While a Russian was not responsible for the record One57 penthouse purchase, don’t expect the region’s influence on the city’s real estate market to wane. In a video on CNBC, Alex Rovt, who recently acquired the 1 million-square-foot office tower at 14 Wall Street for $303 million in cash, and Ukraine-born real estate attorney Edward Mermelstein explain the region’s infatuation with New York City Property.
“It’s not atypical that someone from that part of the world will spend $200 million or 300 million dollars for an apartment in London or a house in southern France,” Mermelstein said. “So for them to purchase something in Manhattan for $88 million, in a sense, is a bargain.”
The number of billionaires in Russia and Ukraine has increased more than three-fold in recent years and many of them prefer to park their money in trophy properties. In recent years, composer Igor Krutoy spent $48 million on a Plaza apartment, Andrei Vavilov dropped $37 million on a Time Warner Center penthouse, and Dmitri Robolovlev paid $88 million for a 15 Central Park West spread. These are seen as better investments than the stock market.
“You know why I’m winning [the stock market]?” Rovt, whose net worth is $1.2 billion, asked rhetorically. “Because I never play it.”
Meanwhile, Mermelstein is holding seminars for New York City brokers to help them land clients from that region.
“What we’ve seen in the last several months in terms of very large residential purchases and very large commercial purchases is something that we expect to increase moving forward in the next year,” he said. [CNBC]