Can Barnett really get $250M for the Central Park Tower penthouse?
“This submarket is a circus sideshow”
From NFTs to NFL teams, there have never been so many trophies for billionaires to buy. But Gary Barnett still thinks he can persuade a fellow billionaire to part with $250 million for good old real estate.
On Thursday morning, the Extell developer joined a rarefied club when he listed the penthouse of Central Park Tower for $250 million. It’s an audacious ask from an audacious builder for his most audacious apartment yet: a 17,500-square-foot triplex that looms more than a quarter mile above Central Park.
Asking roughly $14,300 per square foot, he is not the first to post such an aggressive listing. He’s not even the first to do so on Billionaires’ Row. But very few sellers in the country have actually closed at that tier.
Barnett seems to think the asking price is reasonable. “There’s a bunch of artwork going for $100 million and even $200 million,” he told the Wall Street Journal. “When you compare that to 17,000 feet of steel and brick and glass at the top of the world, this seems like a relative bargain.”
Central Park Tower already climbs higher than any residential condominium in the world. But experts doubt that the building’s sale prices can hit the stratosphere too — at least not as high as Barnett is asking.
So, let’s consider other deals that could suggest Barnett’s betting too big.
This year, no Manhattan developer has come even close to a snatching a quarter billion dollars on resi deal, according to data from TRD Pro. The estate of late Microsoft founder Paul Allen sold two units at 4 66th Street for $101 million in June, marking the top sale of the year.
While the exact square footage of the apartments isn’t known, previous sales suggest that full-floor units at the building are about 7,500 square feet. Assuming a combined span of 15,000 square feet, that would put the Allen sale at around $6,700 per square foot, less than half Barnett’s ask at Central Park Tower.
Manhattan’s condo inventory is at its lowest level in years, dropping below 6,000 units for the first time since 2018, and availability is down 13 percent from Feb. 2021
But New York might not be the right comp. These nine-figure homes form a category of their own, according to real estate appraiser Jonathan Miller.
“This submarket is a circus sideshow and not necessarily connected with the market it sits within,” he said.
While New York is one of the few locales that has any inventory that could sell for $100 million or more, it makes more sense to compare the Central Park Tower penthouse with an Aspen estate than a condo on the Upper East Side.
Outside New York, a few major listings nibble at Barnett’s toes. In April, former Disney CEO Michael Eisner listed his Malibu estate for $225 million. While that’s nothing to sneeze at, Eisner’s five-acre compound gives its buyer more room to spread out than Extell’s penthouse, so the asking price comes out to a significantly lower $9,000 per square foot.
The priciest California property to actually close is venture capitalist Marc Andreesen’s estate in the Paradise Cove section of Malibu. That seven-acre spread traded hands for $177 million, around $580 per square foot including outdoor space, a far cry from the reported asking price of $250 million.
The Chartwell Estate in Bel Air once asked $350 million, before media heir Lachlan Murdoch picked it up for $150 million in 2019. If the 25,000-square-foot home had sold at its initial asking price, it would have commanded the $14,000 per square foot Barnett is roughly aiming for now. The previous year, Formula One heiress Petra Ecclestone sold the Spelling Manor for about $120 million, a whopping $80 million less than its asking price.
Moving east on the billionaire trail, a mountainside retreat in Aspen, Colorado hit the market in July asking $100 million, a little more than $7,100 per square foot. There, entrepreneur Joel Tauber wants more than ten times the $9 million he bought it for in 1996. The mountain resort saw serious price appreciation during the pandemic as sparse supply and heightened demand pushed listings ever higher. Still, no Aspen home has sold for more than $72.5 million, so Tauber may be barking up the wrong slope.
To find the southeast’s epicenter of high-dollar mansion sales, hop on the private jet to Palm Beach, where Oracle founder Larry Ellison recently listed his 15,500-square-foot oceanfront estate for $145 million, which works out to $9,346 per square foot. In what may be yet another case of aspirational pricing, Ellison is asking more than 80 percent above the $80 million he paid for the estate last year.
Ellison has experience with Florida real estate records. He spent $173 million for a Manalapan mansion in June. The estate, which belonged to the Ziff family for decades, once listed for $200 million.
From Palm Beach, cruise up the east coast and dock your megayacht in Southampton to find some of the northeast’s priciest listings. In August 2017, financier Brenda Earl listed her 42-acre estate at 90 Jule Pond Lane for $175 million, just shy of $96 per square foot when including the property’s sprawling private grounds. That matches the $175 million advertising executive Marcia Riklis asked for her own waterfront home in Southampton last year. The Jule Pond home wound up selling for $105 million, or $60 per square foot, while Mylestone is still on the market, according to listing site OutEast.
To complete our journey, let’s double back to another Billionaires’ Row penthouse in Manhattan that once matched the $250 million ask. At 220 Central Park South, hedge funder Ken Griffin shocked the real estate world when he dropped $238 million for the quadplex penthouse. But even that record-setting deal is modest in comparison to what Barnett hopes to pull at Central Park Tower. Vornado initially asked $10,900 per square foot.
In all, just 10 homes across the country have sold for more than $150 million in the past five years, and most of those closed well below their asking price, according to real estate data firm Marketproof.
“In this tier, sellers are throwing out a number to see what sticks,” said Marketproof CEO Kael Goodman. “The Central Park Tower penthouse is pure aspiration, and Extell is aiming high.”