Development hell: Here are NYC’s most-delayed condo projects
Closings at the Charles got AG's okay 7 years after plans were filed
In Hollywood, they call it “development hell.” Film productions become mired in limbo at various stages between start and finish. Ideas collect dust on a shelf — and the attached cast and crew come and go. “The Simpsons Movie” and James Cameron’s “Avatar,” both ultimately blockbuster hits, suffered a series of stops and starts over roughly a decade.
New York City real estate development is also prone to substantial delays wrought by bureaucracy and financing challenges. The Real Deal looked at five large, ground-up Manhattan condominium projects over a 10-year period that took the longest to go “effective,” the required step from the New York state Attorney General’s office to begin unit closings. For this to happen, buyers must have signed a contract for at least 15 percent of the units offered under the plan.
These projects are the outliers in a process — from the date of submitted plans to the “effective” date — that on average spans 657 days, according to TRD‘s analysis. The median number of days is 596, based on the 279 projects that were filed with 50 or more units and have been declared effective as of Sept. 30. The analysis includes projects for which 50 or more units were proposed in the initial submission.
The most frequent cause of delays over the past decade was the housing crisis that put many condo projects on ice. A large proportion of the offering plans on this list were filed between 2006 and 2008.
Manhattan condo projects that took years to rise
|Address||Developer||Days between submission & effective||Submitted date||Effective date||Number of units|
|1355 First Avenue||Bluerock Real Estate and Victor Group||2,455||10/31/07||7/21/14||27|
|50 United Nations Plaza||Zeckendorf Development||2,390||5/27/08||12/12/14||88|
|56 Leonard Street||Alexico Group and Hines||2,076||2/01/08||10/08/13||145|
|57 Reade Street||John Buck Company||1,834||4/13/07||4/20/12||84|
|60 Riverside Boulevard||Extell Development||1,317||813/07||3/22/11||151|
In the top spot, the Charles at 1355 First Avenue on the Upper East Side languished for a whopping 2,455 days, or 6.73 years. Ramin Kamfar’s Bluerock Real Estate and the Victor Group filed plans for 51 units in October 2007, and in July 2008 the AG’s office accepted them. But plans did not go effective until July 2014. Construction stalled for years until the developers secured more than $111 million in financing, in 2011 and 2013. In August, one family bought five penthouse units at the 32-story, 27-unit property for $58.6 million.
Behind the story:
56 Leonard Street
60 Riverside Drive
1355 First Avenue
Roadblocks also plagued high-profile condos such as 50 United Nations Plaza (2,390 days), 56 Leonard Street (2,076 days), 57 Reade Street (1,834 days) and the Aldyn at 60 Riverside Boulevard (1,317 days). Alexico Group brought on Hines to co-develop 56 Leonard and help the firm score a $350 million construction loan from Bank of America and others in 2013.
On the opposite end, some filing plans go from submitted to effective in a flash.
Sherwood Equities’ 25-story, 137-unit condo, Known As 1600 Broadway on the Square, had a remarkably fast turnaround in 2005. It went from plans to closings in 179 days, or just under six months. The Midtown building opened in 2006.
Other projects such as Douglaston Development’s 555 West 23rd Street and the Related Cos.’ 425 Main Street took little more than 200 days.
Meanwhile, some developers are still waiting for their condo plans to be declared effective by the state. Silverstein Properties, for example, filed for 157 condos – in addition to 185 hotel rooms – at 30 Park Place in November 2013. Plans were accepted in May 2014, but are not yet effective.