Dec 10, 2014

Manhattan Market Report | November 2014


Manhattan Market Report | November 2014

In November 2014 strong year-over-year price growth resumed in the condo market; median price, average price, and average price per square foot all saw double-digit gains. Price gains, however, in part reflect the increase in quality of available inventory and lack of lower-priced options, in addition to appreciation. 

The co-op market continued to see steady overall price growth since last November with price per square foot up 4% and average price up 11%. The market still suffers a surplus of high priced inventory and dearth of product under $3MM; just 3% of sales this month were above $5MM while that price bracket makes up 18% of current inventory. 

Market-wide inventory has increased since last month as well as last year, although nearly all of this growth is due to condo listings as co-op inventory remains flat. Contracts signed are down 6% year-over-year overall, but again split by market: condo sales are down 19% while co-op sales are up 5%. 

The increase in co-op sales has kept pace with supply while the decrease in condo sales has augmented the growth in available listings. With no change versus November 2013, co-op listings remain near historic lows. 

This month saw co-ops take the highest percent of sales (60%) compared to condos since January 2012.

Dec 6, 2014

Upper West Side School to Residential Conversion


555 West End Avenue  (photo courtesy of ©Mitchell Hall)

St Agnes Boys High School building on West End Avenue at 87th Street will soon be converted into condos The Real Deal reported.

The High School closed in 2013. According to the article Cary Tamarkin’s architecture and real estate development firm paid $50 million to the Archdiocese of New York for an Upper West Side church property. Tamarkin Co. bought the six-story building at 553-559 West End Avenue, at the corner of 87th Street, according to public records. 

Built in 1919, the limestone and brick building housed St. Agnes from 1990 until last year. The building is 80 x 100 feet with 41,561 square feet above ground, the building was sold for nearly $1,200 per square foot. The property also has approximately 39,000 square feet of additional air rights. The building is located in the Riverside-West End Avenue historic district. 

West End Avenue 

Manhattan New Developments and Conversions 

Dec 5, 2014

Seller Tips | How to get the Highest Price

  • Clean it up – Buyers respond to open, bright, and uncluttered. You may love your d├ęcor but unless it is up to date, well lit, bright and tchotchke-free, buyers probably won’t.
  • Price it right - Every seller in the world believes his or her property is worth more than the competition, simply because it belongs to them. It’s normal and inevitable. But it’s not true! Listen to your broker on this one. The best time to sell your property is during the first three weeks it is on the market. Why? Because during that period, you get the benefit of pent up demand. The current market offers few choices in most price brackets due to low inventory. So these days, when something new comes to market, it receives a lot of attention from the buyers who are poised to buy when the right thing comes along.
  • Don't second guess yourself – The attention your property gets when it hits the market does NOT mean you under priced it. So if you’re lucky enough to get three offers during the first week, don’t remove the property from the market and increase the price! If your home is that popular, competitive bidding will find its best price, often above your asking price.
  •  Don't make a deal during first 48 hours – A bid on the first day usually means others are coming. Often your first bid is the best one, but not always. If you expect multiple bids, work out a plan with your broker and stick to it. I usually advise going to “highest and best” offers after ten days or two weeks. That usually provides adequate time for everyone who is interested to see the property.
  •  Listen to feedback – If the property does NOT receive any offers during the first three weeks, it is almost certainly overpriced. The sooner you and your agent correct that pricing problem, the more likely you are to sell the property promptly and well Sellers often say they don’t want to reduce their price, urging their broker instead to encourage prospects to make offers. But buyers don’t work that way. Unless they perceive your property as appropriately priced, they don’t want to make an offer. That is just the way it is.
  • Be patient – If it doesn't sell during the first few weeks, your property may be on the market for a while. But it WILL sell! You may have to make a price adjustment. You may have to re-stage it. Buyer interest often follows a particular trajectory: during the first few weeks, pent up demand provides a steady stream of lookers. That tends to dissipate by the end of week three. If the property has not sold, there is then usually a slow period- it can last for weeks or months. This tends to be followed by a catalytic event: usually a price reduction. And THIS, in turn, generates additional interest. So it is not uncommon for a property which has been on the market for four or five months to have a second spike of activity, frequently resulting in two or three offers the same week after a long period with no offers at all. By this time the market will have given you a clear sense of the right price. Now it’s time to make the deal.

Dec 4, 2014

Tips for Tipping

Year in and year out, we are asked about New York City holiday tipping etiquette, especially for apartment building staff. 

Here is my take on the situation:
So many ask, “why tip at all for someone who is merely doing his job?” We feel that an additional reward for work well done is a welcome gift. It is good manners, and customary to show one’s appreciation by giving a little something extra during the holiday as a way to say “thank you”.

Keep in mind the following factors in determining what to give:
  • how pleased are you with the service
  • the frequency of the service
  • how long you’ve known the person
  • your budget
  • the local custom
  • the type of establishment (deluxe vs. moderate building)The following are ranges of suggested gratuities:
  • Apartment Building Superintendents: $25 - $150 There is a wide range here depending on the services offered by your building and how much the staff are at your beck-and-call during the year.
  • Doormen: $25 and up Take into consideration how nice they are to you, if you get lots of visitors and deliveries, and if they actually open the door for you. To maintain a level of quality service, you need to pay for it.
  • Porters: $15- $30 These people have a difficult and sometimes unpleasant job. If you’ve spilled Styrofoam packaging stuffers in your hallway or incinerator room, you owe it to your custodian to remember.
  • Handyman: $15 - $30 This is an instance where your tip can be proportionate to the amount of the work you’ve requested during the year. If you merely greet the handyman in the hall, the lower end of the range should suffice. If you’ve gotten him out of bed in the middle of the night to repair a gushing water leak, ask yourself how much such a task is worth to you and show your appreciation accordingly.
  • Mail Carriers: $10 - $20
  • There is a long list of other people to remember during the holidays-garage attendants, personal trainers, housekeepers, babysitters, stylists, etc., and the range of what is considered appropriate is wide and left mostly to personal judgement.
Regardless of the cash value of any gift, however, it is important that a gratuity be given as a present. Include a nice card with a hand written note and deliver it personally.

Cash is appreciated, rather than checks.In what can seem like an uncivilized city, it is important to remember to make a gesture of appreciation to those who make your life easier. The holiday season is the perfect time to do so.

Dec 2, 2014

Sprinkler Disclosure

Governor Cuomo signed a bill that requires all leases include a disclosure of the existence or 
non-existence of sprinkler systems in the leased premises. 

 The new law takes effect on 12/3/14.  

The legislation requires inclusion of the disclosure if the lease is for a property that is residential.

The legislation is only applicable to residential leases regarding the presence of sprinkler systems
 within the leased premises.

It applies to all residential leases, so a renewal would therefore have to include the notice. 

Nov 27, 2014

Happy Thanksgiving


Nov 21, 2014

Pier 55 - Floating Park in Hudson River

Futuristic Floating Hudson River Park
Artist's Rendering CreditPier55, Inc./Heatherwick Studio
Media mogul Barry Diller and fashion designer Diane von Furstenberg plan to create a $170M floating park in the Hudson river near Chelsea and the Meatpacking District.

View from Manhattan 
CreditPier55, Inc./Heatherwick Studio

As reported by the New York Times, an additional $39.5M of funding for Pier 55, which has the support of Gov. Andrew Cuomo and Mayor Bill de Blasio, would come from the city, state and Hudson River Park Trust, subject to approval of the Trust's board.

 CreditPier55, Inc./Heatherwick Studio 
The Diller-Furstenberg Family Foundation will supply $130M. It will feature lawns, gardens and three performance spaces, including a 700-seat amphitheater.

The 2.7-acre project, dubbed Pier 55, would replace the decaying Pier 54 on West 13th Street and be connected to Hudson River Park in Manhattan via platforms.
Pier 54
Credit Mitchell Hall 
Approvals also must come from the Army Corps of Engineers and state Department of Environmental Conservation before construction can begin in 2016.

Nov 20, 2014

Your Home is a Commodity - Control the Sale Process


What Do Manhattan Sellers Have Control Over?
  • Location? No
  • Room Count? No
  • Square Footage? No
  • Floor? No
  • View? No
  • Building Amenities? No

What sellers actually have control over
  • Price: Nothing matters more than the initial list price. Buyers and buyers’ brokers are very tuned into to marketplace valuation and the power dynamic shifts to the sellers when an attractive pricing means an apartment is seen as something to be pursued actively. If your goal as a seller is to get the most amount of net proceeds at closing in the shortest most efficient way, an attractive price is the only way to achieve that. Even in very soft markets, a well priced opportunity will attract a great deal of interest and offers and an overpriced one will not.
  • Sales Site Preparation: The way a home looks, feels, smells and presents is very important. Buyers make very fast decision when they walk into a home or first see the pictures online. I’ve watched the evolution occur where more and more buyers have spent a great deal of time scrutinizing pictures and then arrive to either have their impressions confirmed or disappointed. Sellers need to invest in creating an appealing home that buyers want to live in.
Some Obvious Suggestions That Can make a Difference
  • Clean and Clean! The home should be sparkling clean, not just for the first Open House but for every single showing. No dust. No clutter not a single thing that will result in a negative reaction. Sellers do well to remove into storage as much as possible.
  • Depersonalize. Buyers want to imagine living in their home not yours. Sellers should remove all or most photographs, kids drawings or overly personal and items.
  • Paint. A fresh coat of paint can be one of the best investments you can make to increase the value of your apartment. Keep colors neutral and light.
  • Stage. This means hiring a professional to come to your home and rearrange, bring in new furniture and generally make the home as appealing as possible. Simply swapping in new towels, sheets  etc can have a huge impact. An empty apartment can be virtually staged at a lower cost that can help buyers visualize the space furnished. 
  • Marketing. The Price you get is a function of the Marketing you choose. 
  • Negotiating Attitude: This is a key component of a successful deal and one that is hard to convey. Years of negotiating deals has given me a sense of the tone, attitude and timeline expectation. A good broker will walk the line between keeping the pressure on to get clients to act but not scaring them away with overly aggressive tactics
More tips on increasing your home's value through home sales preparation in Manhattan Home Enhancement Guide.

Nov 17, 2014

Manhattan Monthly Market Report | October 2014

Manhattan Monthly Market Report | October 2014

  • Price growth was most prominent this October in one bedroom co-ops, up 18% versus last October, due to increasing demand for more affordable product. 
  • Market-wide inventory has increased since last month as well as last year, although nearly all of this growth is due to condo listings as co-op inventory remains flat. 
  • Contracts signed are up 3% year-over-year overall, but again split by market: condo sales are down 8% while co-op sales are up 13%. The increase in co-op sales has kept pace with inventory, keeping co-op listings near historic lows while the decrease in condo sales has supplemented the growth in available listings.

Nov 9, 2014

What is a Land Lease Building?

A building that has a land lease ("ground lease") does not own the land the building was built on. Building residents pay rent for the ground on which it stands instead of owning it outright as most co-ops and condos do.

There are approximately 100 ground lease co-ops in the city. Condos are not allowed on land leases by state law, except in Battery Park City, Roosevelt Island, and Brooklyn Bridge Park, which are specifically allowed in the condo law. The land in these locations is owned by quasi state/city agencies such as The Battery Park City Authority or the Roosevelt Island Operating Corporation.
Battery Park City

Battery Park City is unique because it is on a portion of land created by land reclamation from the Hudson River. Battery Park is owned and managed by the The Battery Park City Authority.  Parcels of land are leased to developers who build in accordance with the Authority's guidelines and mandates. BPC is the largest "green" neighborhood in the world.

Instead of paying real estate taxes, condo owners in Battery Park City pay "PILOT" payment in lieu of taxes. The common charges and "PILOT" varies from building to building depending when the building was built and the time frame of the land lease. 

Most buildings in NYC with land leases are coops or condops. A condop is a residential building or portion that includes cooperative and condominium ownership structure. The condominium has a residential cooperative unit separate from the commercial units. Coops unlike condos usually have underlying mortgages.

One Carnegie Hill
Shareholders in coop's with land leases are not only paying the underlying mortgage on the building, they're also paying rent for the land. Typically adding 20 percent or more to the maintenance. 

Apartments in land lease buildings sell at discounts compared to non land-lease comparable coops because of the higher maintenance usually associated with land-lease buildings. How much an apartment costs to live in monthly determines it's affordability not it's sale price.

While shareholders of all coops have less control over their homes than owners of real property such as condos and townhouses coop shareholders in land leased buildings have less control over their building's destiny. The owner of the land the building is on has more control.

Where there is risk, there may also be opportunity. It is important to have a real estate attorney with land lease experience conduct due diligence when considering purchasing a unit in a land leased building. There are many variables and degrees of risk, pros and cons. The land lease may be for 100+ years. There may be an option for the coop to buy the land outright. There may be clauses with automatic renewals with specified amounts of rent increase. There may be tax benefits. 

The ground below Trump Plaza, a coop at 167 E. 61st St., is currently up for sale. The co-op board has offered to buy the property. The residents would be hit with assessments that would be more than $1 million for some shareholders. Two Fifth Avenue a coop in Greenwich Village, opted out of it's ground lease in 2005 by buying  the land directly from the sponsor developer, Rudin Management when the board’s 20 year ground lease was about to expire. 

The Cathedral of St John the Divine in Morningside Heights is building apartments on its Upper West Side property. The church signed an agreement with Brodsky Organization, to lease the parcel. Brodsky will pay rent for the land.

Chelsea Enclave
Another example, The Chelsea Enclave originally entered into a 99-year lease with the General Theological Seminary causing the units to be condops instead condominiums but the Seminary in Chelsea agreed to sell three of its buildings and some land to developer, The Brodsky Organization for $47.5 Million.  

Carnegie House at 100 W. 57th St., 995 Fifth Avenue, The Marais at 520 West 23rd Street, The Azure at 333 E 91st St,  Excelsior at 303 East 57th,, The Sovereign at 420 East 59th Street, One Carnegie Hill at 215 East 95th Street, 101 West 23rd Street and 88 Morninside Avenue are some coop and condop buildings in Manhattan with land leases. 


This blog site is designed and published as a consumer service by local real estate broker to help Manhattan, New York City buyers, sellers and renters make informed real estate decisions. This site and its feeds are owned and operated by Mitchell J Hall, a NY State licensed real estate associate broker associated with The Corcoran Group and member of the Real Estate Board of New York.

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