In the rarefied air of high-end Manhattan real estate, the new kids on the block are losing out to the veterans.
Vornado Realty Trust’s 220 Central Park South made headlines last week with the news of an $80 million resale — one of the most expensive deals of the year and a nearly 20 percent premium over its initial sale price.
With deals over $50 million at Witkoff’s 150 Charles Street and Metro Loft’s 443 Greenwich on the books, the priciest resales in Manhattan have handily beaten the top new development sales so far this year.
“Between 2013 and 2016, you had a string of incredibly successful, large-scale new developments that we’re now seeing resales in, especially downtown,” said Kelly Mack, president of Corcoran Sunshine. “They compete sort of head to head with new development.”
The average sale price of the five most expensive resales was just under $45 million, about 20 percent higher than that of sponsor sales, according to The Real Deal‘s analysis of closed condo deals from January to July. On average, the top resales went for nearly $2,700 more per square foot than new development.
“The very high-end luxury buyer is really willing to pay up to get exactly what they want,” Mack said, whether that be a specific neighborhood, building or amount of outdoor space. “That type of inventory at the moment is in very, very tight supply.”
In Manhattan, the market share of resales and new development above $5 million was relatively evenly distributed for the past decade, but this year, resales started to inch ahead, according to data from Corcoran Sunshine.
Of the 525 deals closed in 2023, 43 percent were new developments. In apartments that sold for $30 million or more only two of the 12 deals closed this year were sponsor sales.
“Some of it absolutely has to do with sort of the category mix of the type of buildings,” Mack said. “The cost of land and construction [is] skyrocketing, and the pipeline in many of the most desirable neighborhoods throughout New York is shrinking. So [buyers] might not have another shot at an apartment like that for quite some time.”
Topping the resale charts is the penthouse at 150 Charles in the West Village, which closed for a whopping $11,500 per square foot last month — an amount rivaled only by Billionaires’ Row towers such as 220 Central Park South.
The 150 Charles deal was one of a flurry of pricey Downtown sales. Penthouses at 443 Greenwich in Tribeca and Alfa’s 151 Wooster Street in Soho also nabbed sales at $50 million or above this year. Another penthouse at 150 Charles closed for $39 million earlier this month.
“Those were one-of-a-kind apartments that are quite large, generally at the top of the building and almost all of them had significant outdoor space,” Mack said. “People have one shot when those come on the market, and you never know when they’re going to come on the market again.”
In some cases, these apartments don’t even hit the market. Deals are instead arranged behind closed doors, as buyers and brokers try to pinpoint which sellers might be willing to give up their spot in these buildings.
“[Sellers] in those positions sometimes throw out a number that is quite high, but they’re willing to part with it if they think someone’s willing to pay it,” Mack said.
She added that some of these deals are proof that “buyers who are looking for something very, very specific are willing to pay significant amounts that are inconsistent with past trades in the building.”
Most of the ultra high-end new development in downtown Manhattan is concentrated in Chelsea and Hudson Yards with buildings like One High Line, The Courtland and 35 Hudson Yards, where Related Companies has offered steep discounts and concessions.
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Nearly four years after sales launched at the building, about half of the units are unsold, according to an analysis by The Wall Street Journal.
“When we first opened the job, we thought we’d be able to get a higher price,” Sherry Tobak, who heads sales at the building for Related, told the Journal. “The message [from the market] was that we were overreaching a little bit.”
If buyers want similar quality in Tribeca or the West Village, they’ll have to wait for a resale, Mack said.
“There [are] not a lot of large-scale, fully-amenitized [buildings] with light, views, air, impeccable services” in that area, Mack said. “There’s not much coming to market in the next year.”
Among the most expensive new development sales are two units at Extell’s Central Park Tower. Unit 114 closed in April for $45 million, about $19 million less than its original asking price, and another unit, 84E, closed for $25 million in June.
Though the supertall at 217 West 57th Street — marketed as the world’s tallest residential tower — has locked down pricey sums, deals haven’t lived up to Gary Barnett’s expectations. The developer initially projected a $4 billion sellout for the building but has since acknowledged it likely won’t achieve that sum.
An October 2021 TRD analysis showed condos in the building had sold for about 25 percent less than the prices outlined in the building’s offering plan.
JDS Development and Property Markets Group’s 111 West 57th Street landed the priciest sponsor sale in March when it sold unit PH78 for $47.2 million. The 6,500-square-foot unit asked $53.8 million in the condo’s offering plan.