May 16th, 2013
Posted on May 16th, 2013
Is the concept of Midtown highrise living (a-la-One57)invading Eastern Tribeca? It appears so. Joining the sky-high condominiums of the Woolworth Building and 56 Leonard Street comes word that Larry Silverstein has finally secured funding for his long-planned $950 million luxury high-rise in TriBeCa: The 82-Story Robert A. M. Stern-designed tower will house a Four Season’s Hotel as well as 157 (co-incidental?)condo units and is slated to break ground at 30 Park Place this fall.
Construction will last about three years on the 926-foot skyscraper, with its opening planned for 2016, according to the real estate legend who is responsible for the Freedom Tower and re-building of the World Trade Center site. Silverstein first announced plans for this project in 2008, but then known by its 99 Church St. address, stalled after the financial crash. The property, set to include 185 rooms for the hotel, as well as 157 private residences, will also include a public plaza.
Tower 270, located at 2 70 Broadway at Chambers Street was certainly the pioneering building of the area, and offered apartments with panoramic views for the first time in Tribeca, an area known mostly for rehabilitated low-lying commercial buildings and lofts. We have two Steven Harris-designed penthouses listed in the building, and all of a sudden they appear priced in bargain territory.
May 14th, 2013
Posted on May 14th, 2013
After this morning’s KNIGHT FRANK-led conference on the international housing outlook, predicting huge growth in demand for luxury real estate as global wealth expands, more news came in about the ever improving U.S. economy: The budget deficit will shrink this year to $642 billion, the smallest shortfall in five years….some good news from the government at last!
The nonpartisan Congressional Budget Office today reduced its estimate of this year’s likely shortfall by more than $200 billion compared to what it had expected in February. The agency pointed to stronger-than-expected tax receipts as well as payments to the Treasury by the government-owned mortgage financiers Fannie Mae and Freddie Mac for the change…..again, housing drives the economy forward.
The government ran its widest surplus in five years last month, with revenues up 28 percent compared with April 2012, according to the Treasury Department. That would be a major improvement from last year’s $1.1 trillion deficit, and would mark the first time since 2008 that the gap between taxes and spending slipped below $1 trillion.
Next year’s deficit will further shrink to $560 billion, CBO said. The deficit will continue to fall in 2015, according to the report, before beginning to grow again. The brighter outlook will help postpone the effective deadline this year for raising the government’s debt ceiling, and may ease demands from some lawmakers for tough budget cuts. House Republicans are scheduled to meet tomorrow for two hours to consider their strategy for the upcoming debt-limit fight.
Tax receipts for the fiscal year ending Sept. 30 will rise 15%, CBO said, partly because Congress allowed a payroll-tax cut to expire, partly because a January budget deal allowed taxes on the wealthy to rise and partly because of economic growth…..and improved unemployment figures.
So $ 2,500/sf may indeed be the new ‘new $ 2,000/sf ‘after all!
May 13th, 2013
AT FRIEZE 2013
Posted on May 13th 2013
I loved this lady at the FRIEZE 2013 art show this weekend in New York on Randall’s Island: she stood in sharp contrast to all those uber-haute-culture-fashionistas in their daunting black ensembles, profound accessories, carefully placed tattoos, statement jewelry, abstract expressionistic hairstyles and seriously framed glasses. I vote for this lady’s sensible shoes designed to schlepp up and down those miles of aisles in comfort. I was probably the ultimate Art-crowd-Antichrist……I sought out art suitable for condominium lobbies: Surely every good new building should have good art in its lobby?
May 13th, 2013
Posted by Leonard Steinberg on May 13th, 2013
Is it possible that sales at 150 CHARLES STREET are breaking a world record? After reaching the 3 month date on the calendar this weekend (February 11th, 2013 being the day we started sending out contracts) we are now in contract for almost $750 million worth of apartments in the building, surely a record for speed of sales at prices that are record-setting in areas too. While certainly an ‘overnight success’, I started working on this remarkable West Village building with my colleagues over 5 years ago: Back then we were hoping to break the $ 2,000/sf barrier which we felt was easily do-able……as of today we are averaging well over $ 3,000/sf or 50% above original estimates.
150 CHARLES STREET is a mirror to the real estate market in New York in general, where heated sales activity continues across the board, especially in the sale of high end, brand new buildings. A huge thanks to Darren, Raphael, Susan, John, Madeline, Peter, Elizabeth, Therese and all those involved in making this historical sales effort possible…..and so much fun!
May 9th, 2013
Posted by Leonard Steinberg on May 9th, 2013
The horrific details of the kidnapped ladies in Cleveland are being revealed, and I am not sure what is more horrifying: the details of this crazed sadistic monster’s actions or the fact that for over a DECADE none of the neighbors had any clue there were captives being held next door. Which begs me to ask the question: do you know what is going on in your neighbors home?
Maybe its time to celebrate those neighborhood yentas who actually do know what is going on with the neighbors. This Cleveland revelation should be a wake up call to all that no police force can be as effective as each individuals civic duty to be aware, and help those in need that literally live under our same roof.
IF YOU SEE SOMETHING, SAY SOMETHING…..but first lets all open our eyes and LOOK!
May 8th, 2013
Posted by Leonard Steinberg on May 8th, 2013
I have repeatedly griped about the huge (un-constitutional)disparity in the way real estate taxes are assessed in New York: the range is often so large between very simlar properties that it would be laughable if it were not that sad. The system is driven politically, and this same reckless abuse of the taxpayer and consumer is now being fully revealed by a study conducted into the costs of health care.
In Saint Augustine, Fla., one hospital billed nearly $40,000 to remove a gallbladder, while one in Orange Park, Fla., charged $91,000. In one hospital in Dallas, the average bill for treating simple pneumonia was $14,610, while another charged over $38,000.
Data being released for the first time by the government shows that hospitals charge Medicare wildly differing amounts — sometimes 10 to 20 times what Medicare typically reimburses — for the same procedure, raising questions about how hospitals determine prices and why they differ so widely. The data for 3,300 hospitals, released by the federal Center for Medicare and Medicaid Services, shows wide variations not only regionally but among hospitals in the same area or city.
Government officials said that some of the variation might reflect the fact that some patients were sicker or required longer hospitalization. Nonetheless, the data is likely to intensify a long debate over the methods that hospitals use to determine their charges.
Medicare does not actually pay the amount a hospital charges but instead uses a system of standardized payments to reimburse hospitals for treating specific conditions. Private insurers do not pay the full charge either, but negotiate payments with hospitals for specific treatments. Since many patients are covered by Medicare or have private insurance, they are not directly affected by what hospitals charge.
Bankers are held accountable for their fee abuses, and they have to disclose their fees CLEARLY…..why aren’t hospitals and doctors held to the same standard? Why is it that one of the single largest expenses to the consumer is so grossly unregulated? For our economy to truly flourish, we should all understand that extreme health care costs are a form of taxation on the consumer and corporations that slows growth and job creation. Entitlement costs are bankrupting states who …..here are some facts to ponder:
***According to the World Health Organization, the United States spent more on health care per capita ($7,146), and more on health care as percentage of its GDP (15.2%), than any other nation in 2008. ***The Commonwealth Fund ranked the United States last in the quality of health care among similar countries, and notes U.S. care costs the most. ***A 2001 study in five states found that medical debt contributed to 46.2% of all personal bankruptcies and in 2007, 62.1% of filers for bankruptcies claimed high medical expenses. Since then, health costs and the numbers of uninsured and underinsured have increased. *** A 2013 study found that about 25% of all senior citizens declare bankruptcy due to medical expenses. ***It is estimated that a 1% increase in the unemployment rate would increase Medicaid and SCHIP enrollment by 1 million, and increase the number uninsured by 1.1 million. State spending on Medicaid and SCHIP would increase by $1.4 billion (total spending on these programs would increase by $3.4 billion). This increased spending would occur at the same time state government revenues were declining. ***The healthcare industry — including HMOs, health professionals, hospitals and nursing homes, and pharmaceuticals — contributed $825 million to candidates for federal office from 1990-2008. ***The healthcare industry spent $3.4 billion to lobby the federal government on health policy matters from 1998-2008, including $480 million in 2008 alone. ***Annual contributions from the healthcare industry increased sevenfold from $21.9 million in 1990 to nearly $150 million in 2008, placing it in the top three contributing industries to Congress and the President. ***In nine out of ten election cycles from 1990-2008, the healthcare industry directed the majority of its campaign contributions to the political party in power. ***Republicans received 57% of total healthcare industry contributions while Democrats received 43% of industry contributions from 1990-2008. ***The top twenty recipients of healthcare industry contributions from 1990-2008 included an equal number of Democrats and Republicans.
We are all being robbed, and no-one is doing anything about it: will this newly revealed awareness change anything?
May 8th, 2013
Posted by Leonard Steinberg on May 8th 2013
Many of the very successful new buildings being sold right now in New York can attribute a chunk of their success to investor buyers: these are the buyers who plan to either re-sell or rent the units they are buying upon completion of these building which should be anywhere from 12 to 36 months from now. Many of these apartments are very high end and will command rental rates in the teens, 20′s and 30′s monthly: will there be enough renters for all this super high end rental inventory coming to New York?
Now that the consumer is more focused on ownership than renting, will the pool of very high end renters shrink? Does the sound of make-a-quick-buck by buying and selling or renting in a new building sound eerily familiar?
Should buyers of high end real estate be concerned about the volume of investor buyers when buying in a new building? As I complete the sales process for 150 CHARLES STREET with my colleagues Darren and Raphael, I am amazed at the super-low volume of investor buyers in the building…..but I fear we may be the exception to the rule.
May 7th, 2013
Posted by Leonard Steinberg on May 7th, 2013
It’s music to New York’s explosive new developments market: Steinway Hall has been purchased by its next door neighbor who plans to build another super-swanky condominium tower. What was once considered a mediocre block at best on New York’s 57th Street, where the two tallest condominium towers in New York are under construction, comes news that a third skyscraper will be built with apartments perched above the city at near-record heights. Throw in the second Extell Tower being planned as well as the MOMA Tower and thats a lot of mega-highrise apartments! This area is becoming the center of the Manhattan POWER TOWER.
The buyers of Steinway Hall are in informal talks with the city’s Landmarks Preservation Commission and zoning officials about what they may build on the site, which includes the piano maker’s building and an adjacent parcel at 105-107 W. 57th St. that they purchased last year. The investors had plans for a 700-foot (213-meter) tower and now estimate that air rights acquired in the Steinway deal would allow them to go taller — potentially as Manhattan’s third-tallest residential building. Michael Stern, of JDS Development Group and the developer of 212 West 18th Street the uber-luxe condo perched above Chelsea (and the Verizon building), which agreed in March to buy the 16-story Steinway Hall and land beneath it with Property Markets Group and Atlantic Development Group said it will definitely be taller than 900 feet.
The JDS group’s project sits at the center of a high-rise construction boom in midtown Manhattan as developers take advantage of soaring luxury-condo demand. It’s on the same block as the current tallest residential building in the city, Extell Development Co.’s One57, which has set records with two condo sales valued at more than $90 million each. At 432 Park Avenue (@ 57th Street), Harry Macklowe and CIM Group are building a skyscraper on the former Drake Hotel site that’s slated to rise much taller than the Extell property which lost its claim to be the tallest residential tower in New York rather swiftly…
The site is in a special Midtown zoning district that doesn’t restrict building heights, and Park views start around 225ft above street level. This area is specifically appealing to out of town and foreign buyers seeking to be in the center of New York with the full Manhattan skyline views experience. They demand ultra-luxurious, high services and amenities buildings. One 57 is supposedly about 65% sold out at record prices, although it existed in a market when there was little or no competition. We will soon learn how deep this market is.
May 6th, 2013
Posted by Leonard Steinberg on May 6th, 2013
Do you remember the housing bubble of 2008? It appears many have forgotten it already in this heated market. Most of those banksters guilty of robbing us blind escaped any form of punishment. The government failed in its roll to protect the consumer. Is there now a glimmer of hope that something will be done to prevent future mass deception in the banking industry? What about other potential areas of abuse?
New York Attorney General Eric Schneiderman said he will announce new enforcement actions against major financial institutions as part of his effort to protect New York homeowners after calling the first such lawsuit last year a template for future litigation. In October, Schneiderman sued JPMorgan Chase & Co., alleging that Bear Stearns, which JPMorgan took over in 2008, deceived mortgage-bond investors about defective loans backing securities they bought, leading to “monumental losses.” He said the case would be a model for future actions against banks that issued mortgage bonds during the real estate boom. He sued Credit Suisse Group AG on similar grounds the next month.
New York was one of 49 states that reached a $25 billion settlement with five mortgage servicers, including Bank of America, Wells Fargo and JPMorgan, to end a probe of abusive foreclosure practices. Schneiderman’s office had agreements with 12 financial institutions that preserved claims that might be filed against them, a person familiar with the matter said last year. The so-called tolling agreements prevented the statute of limitations, which bars litigation after a specific number of years have passed, from expiring.
Schneiderman helps lead a federal-state group formed to investigate misconduct in the bundling of mortgage loans into securities. The group includes the Department of Justice and the Securities and Exchange Commission.
Warren Buffet said appropriately we are certainly in for another bubble: the only problem is we don’t know what that bubble we be yet. The tech bubble was followed by the most recent housing bubble……is the entitlements bubble next? While the focus is on banker abuses, there are certainly many other areas of abuse that could cause significant consumer harm in the future and they seem to be mushrooming without enough opposition or intervention.
May 3rd, 2013
Posted by Leonard Steinberg on May 3rd, 2013
The one thing that almost guarantees that real estate will continue its upward pricing trend is the fact that big city inflation is quite different from the rest of the country’s (I believe artificially deflated) inflation figures. Did cab fares go down during the recession? Food prices? Health care? Rent? Of course not……in fact the GREAT RECESSION saw some of the biggest increases in inflation numbers ever…..many in areas that our beloved government does not consider of being worthy in their inflation calculations. Can you really believe they omit the cost of housing from their inflation figures, surely the biggest expense any New Yorker deals with?
This week we opened a window into the costs of operating New York City as Mayor Bloomberg revealed his final budget: health-care expenses are expected to jump a staggering 38% over the next four years while pensions are consuming $8.3 billion next year. The deficit for fiscal 2015 — the first budget that would be overseen by the next mayor — was estimated at $2.2 billion. When he took office in the aftermath of 9/11, Bloomberg was staring at a hole of almost $5 billion in a $42.5 billion budget…..this years budget is $ 69,8billion. So the budget has risen an average of over $ 2billion per year over the past 12 years…..or over 4% per year……thats close to double the ‘official’ inflation rate.
Gasoline cost in the year 2003: $ 1.66/gallon………2013: $ 3.85/gallon…..that’s over 7% per year.
1 bed apartment at 39 Fifth Ave: $ 670,000 in 2003…2013: $ 1,2m+……..thats over 6% per year.
So they say our inflation rate is around 2%…..don’t believe it. And while the discrepancy between government estimations and reality is pretty startling, this inflation makes ownership a very good prospect as the real estate escalates with inflation and you avoid those pesky rent increases…..the again maintenance, common charges and real estate taxes don’t ever go down either!