Thursday, January 31, 2008

Thursday Links

MTA Eyes Park For Fulton Transit Center (NY Daily News)
$20 Million Library In LIC Gets Go Ahead? (Curbed)
City Council Looks To Cut Off Tax Break For MSG (NY Times)
New York's First Snow Free January In 75 Years (NY Sun)
Congestion Pricing Plan Takes A Beating In Albany (NY Times)
What Housing Crisis? (Newsweek)
Luxury Tower At Ground Zero Defies Soft Market (Reuters India)
Celebrity Real Estate Round Up (Luxist)

Major League Baseball Makes Play For Harlem Park Office Tower

Courtesy: Crystal CG Renders

It has been reported in today's New York Times and various media sources that Major League Baseball is making a play for the yet to be approved Harlem Park office tower at Park Avenue and 125th Street. The 21 Story, 630,000 square foot tower would be Harlem's first Class A office building in more than 30 years. MLB would take about 1/5th of the proposed space. Vornado, the developer, is also negotiating with Inner City Broadcasting in hopes to move them from Midtown. The structure, about 40 feet above zoning restrictions, would require city approval of an exception to propsed zoning changes to the area. This is the 2nd attempt to develope this parcel which is currently a vacant lot. Mayor Bloomberg and then-Governor Pataki broke ground on the space 3 years ago on what was supposed to be a hotel, but that deal eventually collapsed.
So long as community impact of the retail space is strongly considered, approval of this plan should be a no-brainer. The parcel, which is directly along the Metro North tracks, has been hard to develope, and for years has been home to various people peddling used clothing, books, etc. on the street. A Class A office building would be a tremendous improvement.
An Office Tower To Rise In Harlem For Baseball TV Network (NY Times)
Vornado's Harlem Park Insanity Revealed (Curbed)

Wednesday, January 30, 2008

Wednesday Evening Links

Rezoning Puts Harlem's First Class A Office Tower In Trouble (NY Observer)
NYU Wants To Build Campus On Governors Island (The Real Deal)
In Slap At Hillary, NY Post Endorses Obama (NY Post)
Fed Rate Cut Coverage (NY Times)

Implications Of 2nd Fed Rate Cut In 2 Weeks

Wow! The Federal Reserve has now cut rates by 1 1/4% in just 2 weeks. The market has responded positively, and the market knows well that should the sub-prime crisis deepen, or the markets go astray, the fed is likely to act further. The Fed's statement left the door open for more cuts, noting continued "downside risk" to the economy. The only innuendo from the statement was that last time they used the phrase "appreciable downside risk". It remains to be seen how much of an impact these recent moves will have on mortgage rates, but at a minimum lower rates should allow banks to earn their way out of recent problems.
At this point I am starting to diverge from the conventional wisdom that we are heading for a recession. Durable goods orders reported the other day were strong, ADP payroll figures point to an increase of jobs in January on the order of 150,000, and the weak dollar is creating demand for US products. As a sum, these indicators seem to contradict the notion of an impending recession. Add to all this an exceptionally accommodating fed, a free spending congress (in an election year), and we have plenty of stimulus which makes the odds of a recession is significantly lower.

Breaking: Fed Cuts Rates Another 1/2 Point

At the conclusion of the Fed Open Markets Committee meeting this afternoon, the Fed has announced that it has decided to cut the federal funds rate and the discount rate by 1/2 of a percent.
Back with more details shortly...

NYC Secession Plan Floated...51st State?

According to today's New York Sun, Peter Vallone, Jr. a city councilman representing Queens, has floated the idea of having NYC secede from New York State. At issue is the approximately $11 Billion difference between what NYC sends to the state and what it gets back yearly. Mayor Bloomberg has been vocal on this issue for some time. While secession is highly unlikely (it has to be approved by the state), according to sources inside City Hall, the idea could gain serious traction. If anything, such a threat could be used as leverage to get more tax income returned to the city.
A Secession Plan Is Floated For NYC (NY Sun)

It's Fed Day, Expect Volatility

Today will be an important day in determining exactly where mortgage rates are going short term. At 2:15 p.m. The Federal Reserve is expected to cut rates further. A 1/2 point cut is widely expected, but not a lock. Anything short of 1/2 point would likely rock the stock market (short term), and even if the market gets what it wants, things could get rocky if there is even a hint or innuendo that the fed would pause on it's course. I'll be back later with analysis on the cut and the housing market and economy in general.

Tuesday, January 29, 2008

Tuesday Morning Links

"Construction Inflation Crisis" May Trim MTA Projects (NY Times)
MTA's $900 Million Boondoggle (NY Post)
A Seal Visits West 79th Street (CityRoom)
Solow's "Ground Zero North" Clears First Hurdle (NY Daily News)
WSJ Planning Move To Midtown (Observer)

Monday, January 28, 2008

New Alchemy Project On 77th St, Named "Isis", Breaks Ground Tomorrow

Alchemy Properties' 19 story condo project at 77th Street and 2nd Avenue breaks ground tomorrow, and it now has a name, "Isis". The 19 story boutique condo will be cantilevered on 2 sides, and thanks to the air rights purchased from adjacent lots, it will have light on all 4 sides. The apartments will be "family-sized", mainly 2 and 3 bedrooms, but will also have a couple of "spectacular" 4 bedrooms. Alchemy prides itself on pricing a little below market, which if previous projects like Indigo 21 and Oculus are any indication, means a quick sell through while limiting marketing expense. All indications are that prices should be around $1600 per foot, give or take a little. The building will also benefit with 421-a tax abatement. Marketing is expected to begin in late spring of this year.

Welcome Wall Street Journal Readers!

I've noticed a couple of interesting traffic trends on the blog as of late. First, afineblog has had numerous links and readers from the Wall Street Journal online edition as of late- 3 last week related to mortgage rates, fed action, and the increasing of the cap on conventional mortgages. I'd like to welcome all those readers. I have also noticed a significant increase in foreign readership. We've always had strong traffic from places like London, Switzerland, a Dubai, but the viewership is becoming increasingly diverse. People from Iceland, Thailand, Turkey, and Belarus have tuned in just overnight. To all the people out there, wherever you are from, welcome to A. Fine Blog.

Monday Morning Links

More Details On 15 USW (NY Times)
Ratner Having Trouble Financing Atlantic Yards? (Curbed)
City To Vote On Zoning Changes For Solow's $4 Billion East Side Project (NY Sun)
Protest Over Pier 40 Plan (NY Post)
Presidential Candidates Sub-Prime Solutions (Forbes)
NYC, DC Top Paris, London For Foreign Real Estate Investment (Sun Herald/Mississippi)

Sunday, January 27, 2008

Weekend Links

Housing Market Gives Hint Of A Thaw (NY Times)
Celebrity Real Estate Wrap (NY Post)
The $400,000 House Makes A Comeback (East Hampton Star)
Prefab Green Houses Come To The Hamptons (NY Times)
Foreigners Gobbling Up NYC Properties (NY Daily News)
Lack Of Ultra-Expensive Apartments Irks Brokers (NY Times)

Friday, January 25, 2008

Hyper Touted Yves Gets Glassy!

Maybe it was just because it was a clear sunny day, or the fact that the glass was very clean, Yves condo seems to have a bright reflectivity that outshines all others. The ultra-lux Chelsea condo with spacious layouts has been selling quickly with prices that start around $1400 per square foot.

Thursday, January 24, 2008

Rise In Conforming Loan Limit From 417k to 625k A Great Idea

There has been plenty of criticism of Washington's stimulus plan, but one idea that has built a quick consensus is the proposal to increase the "conforming" loan limit for Fannie Mae and Freddie Mac from $417,000. to $625,000. Such a plan, when adopted (which is very likely) will be a boom for refinancing, save consumers a ton of money, and will make new purchases easier. The current difference in "conforming" and "jumbo" loan rates is about 1.15%. By increasing the limit by nearly 50%, millions of consumers will benefit with lower interest rates, and this increase will soften the impact of the mortgage meltdown. Such a move will lower borrowing costs by as much as 17% for those who now qualify for a conventional rate, who didn't prior to the plan.
For the New York real estate market, this week has been a week of many pleasant surprises. First a change in the 80/20 tax law for coops (I'll get into this over the weekend), then a 3/4 rate cut, and now a change in the cap for conforming loans. For a stable market (in an unstable nation), I'm starting to smell major stimulus. I think the developments of the past week are pretty dramatic, and very bullish for our market.
Market Not Crazy About Stimulus, But Like Raising Loan Limit (CNBC)
Mortgage Rates Lowest Since March 2004 (Yahoo)
Analysts Predict Wave Of Refinancing (Financial Times)
U.S. Mortgage Rates Tumble (CBS Marketwatch)

Thursday Night Links

A little tardy here tonight, as I have been working intensively with a client from overseas with limited time in the city. Here are some pertinent links. I'll be back with comments shortly.
Manhattan Luxury Market Up Big (Curbed)
Bloomberg Predicts Big Drop In Transfer Taxes (Observer)
Skeletal Remains Found In Washington Square Park (CityRoom)
Sliver Lux Lofts Hit LIC (Curbed)
National Existing Home Sales Drop (AP)
Fed Rate Cut Creates Boom In Refinancing (WSJ)
Amenities Keep Getting Better (The Real Deal)

Wednesday, January 23, 2008

Wednesday Morning Comments

Seems like the markets are in for another shaky day, after recouping 3/4 of their early losses yesterday on a 3/4 point rate cut, it looks like another tough start for the markets today. The markets also seem to be indicating that the fed is likely to cut rates another 1/2 point next Tuesday. Whether or not that happens remains to be seen. Again, given the relatively stable state of our (Manhattan) real estate market, lower rates will be a big plus down the road, however, major problems in the European markets would slow down foreign investment in our market. I think everyone needs to take a deep breath and put it all in perspective. When the markets have dramatic drops, the media works itself into a frenzy; when they rebound or stabilize the coverage diminishes. Usually when a market corrects, an overwhelming sense of negativity and capitulation must be achieved before the market rebounds. Needless to say, at this point we have plenty of negativity.
Back with links tonight.

Tuesday, January 22, 2008

Implications Of Fed Rate Cut

The Federal Reserve's decision today to cut both the fed funds rate and the discount rate 3/4 point have far reaching and many potential beneficial implications for the nation at large as well as our local economy. First, it should be observed that the market's tail is wagging the fed's dog. In other words, it's become obvious that the fed is very reactive to the market's dips. For New York, this is actually a big positive in the short term. A proactive fed that is supportive of the financial markets helps minimize or at least reduce the damage to Wall Street, which is a large contributor to the New York economy. Long term, the fed risks overstimulating the economy, however, that looks extremely unlikely in the short term. An aggressive fed accelerating rate cuts is beneficial both nationally and locally. Nationally, a substantial drop in the fed funds rate will likely result in lower mortgage rates. Lower mortgage rates should shorten the depth and length of the mortgage crisis. Even though the bulk of the rate cuts are not passed on to consumers, the fact that banks have the opportunity to earn greater spreads is also beneficial. The last thing this country or economy needs is a bank failure, and any relief to banks at this point could head off larger problems down the road. This brings me to New York. So far, from a real estate perspective, we have dodged bullet after bullet without seeing meaningful price depreciation. We have certainly found ourselves in the enviable position of being seen as a blue chip investment to foreign buyers who see the NYC market a relative bargain compared to international cities, and they are operating with strong currencies relative to our dollar. A scenario where mortgage rates come down quickly will only reinforce the dynamics that we already have in place, and enhance the values of Manhattan properties. We seem to be in a stable market that is on the verge of further stimulus. While it can't be said that we are out of the woods, the quicker the fed acts, the faster NYC real estate prices should resume it's upward appreciation.

Breaking: Fed Cuts Rates 3/4 Point In Emergency Session

In reaction to worsening signs in the domestic economy, and clearly in reaction to a global market rout, the federal reserve has decided to lower both the discount and fed funds rates by 3/4 of a point this morning. The fed funds rate now stands at 3.5%. Initial reaction is a modest bounce in dow futures, which as of 8:27 a.m. EST still stood down over 300 points.
More on the implications soon...

Monday, January 21, 2008

Happy MLK Day!

It's a predictably quiet MLK day here in real estate as many have run for the hills literally for the holiday weekend. The only breaking news here today is that equity investors overseas are running for the hills figuratively, as Asian and European markets are down anywhere from 3-7%. While most of those markets have come off their lows, dow futures for tomorrow's open show a potential loss of 450 points. It is widely expected that the fed will lower rates by 1/2 of a point at the end of the month, however, a large sell off in equities may prompt the fed to act sooner, perhaps as early as tomorrow morning. World markets are concerned about further asset write downs, a byproduct of the sub-prime debacle, and worry that the US economy is slipping into recession. Needless to say, nobody seems impressed by the stimulus package that the bureaucrats in Washington are working on.
The take here is that rates will be lower near term, and the dollar is likely to slide further. These two factors have driven the NYC real estate for the past year, and should continue to be positive contributors. Meanwhile, an aggressive fed could act to stimulate the economy to lessen the odds and or length of a recession.
Stocks Plunge In Europe And Asia On US Recession Fears (NY Times)
Coops Reap Unexpected Bonanza (NY Times)
NY Giants Shock Green Bay To Reach Super Bowl (NY Post)
Letter Grades For NYC Schools Raises Parents' Ire (Newsday)

Friday, January 18, 2008

13 Questions With...Craig Newmark...Inside Craigs's Head

(photo courtesy of
Today, I start a new series, entitled "13 Questions With", where I will try to track down famous figures and ask them 13 questions which are almost entirely unrelated to their field or fame.
I am privileged to start the series with the world's most famous, self described "customer service agent", Craig Newmark, founder of Craigslist. I've been checking Craig's personal blog for years now, and I have to say, he's taken a decidedly political and admirably liberal turn in his day to day musings. Well, my attempt to get inside Craig's head was somewhat successful and may tell you a little more about what the real Craig is about. Here they are:

1- Favorite movie?
Blade Runner

2. Favorite news source?
Combination: Jon Stewart, Stephen Colbert, NPR, BBC, CNN, Keith Olbermann,NY Times, and very importantly, Huffington Post! (The gf recently accused me of being a "news junkie", and now I see she might be right.)

3. How long ago and where was your last real vacation?
What is "vacation"?

4. Why Barack?
(I'm working on a really good answer, will have it the next two weeks, butanyway...)He's a genuine leader, really inspires people to unite and get stuff done.He's about restoring traditional American values, like fairness and a level playing field, to government, already has specific proposals for that.

5. Your most important political issue?
The problem of "front groups", like swiftboaters, corrupting the political process.
6. Favorite Food?
Korean or Thai.

7. Your opinion of California's marijuana laws?
Really don't have one.

8. Love interest?
In a committed relationship.

9. Starbucks lover or hater?
Mixed feelings. They do good stuff, but have done some unfriendly stuff regarding neighborhood coffee houses, etc.

10. Secrets to maintaining your good health?

11. All time least favorite domestic political figure?
Decline to state.

12. Favorite political figure?
Ah, favorite would prob be Barack.

13. Top 3 Albums if stranded on a desert island?
Leonard Cohen: The Future, Dear Heather, Ten New Songs, Various Positions, I'm Your Man (yes, that's five).

Thanks Craig!

Friday Links

It's a bit quiet here on this Friday before MLK day. Enjoy the long weekend. Here are a few links:
Refinancings Pick Up Steam As Rates Fall (WSJ Online)
Credit Crunch Hurts 2nd Home Market, Except Hamptons (Real Deal)
More For Curbed On 15 USW, Retail Tenants (Racked/Curbed)

Thursday, January 17, 2008

Thursday Links

Bloomberg To Keep Property Tax Cut (NY Post)
Curbed Reveals 15 USW (Tiffany Building) Floorplans (Curbed)
Attended Bike Parking Lot Planned For Midtown (NY Times)
Bush's Mortgage Relief Bill Could Be A Windfall For Coops (NY Sun)
Far West Side (50's +60's) Movin On Up! (NY Post)

Wednesday, January 16, 2008

Wednesday Links

Showdown Over Solow's Murray Hill Development Looms (Observer)
Yankees Deflect Negative Attention With Shiny Gold Letters (Curbed)
Leona Helmsley's Belongings Auctioned For Charity (Bloomberg)
Macklowe Selling GM Building, Looks For Better Than A Double For 5 Years (Observer)
Queens Home Prices Falling (The Real Deal)
NYC Property Values Begin To Flatten Out (NY Times)

Lucida Condo Gets Glass

This picture from my morning commute showing that the Lucida condo has begun glassing up the outside. Like the foundation and the thickness of the floors, the windows too look quite solid. The LEED-certified building was over 85% sold as of a couple of weeks ago.

Tuesday, January 15, 2008

Contrary To Media Reports, The World Has Not Come To An End!

Indulge me in a little mix of commentary and editorial, please.
I woke up this morning to catch the top of the news on Good Morning America. I had just woken up and there was still sand in my eyes. The top stories of the day took up 20 minutes and went in this order, more or less:
1- Big bold red letters reading RECESSION? The mortgage crisis was rehashed yet again with a segway into....
2- CITIGROUP LOSSES! A story about how Citi is writing off $18 Billion, cutting it's dividend, and has lost $180 Billion in market cap from it's peak (the story would lead the novice to perhaps believe that they actually lost that $180 Billion, when market cap has nothing to do with income gains or losses), then..
3- Bush's approval at all time low!!! Um, hasn't this been the case for the last number of years? Then...
4- Oil at an all time high!! Ok, we know, we know, and Bush from oil country hasn't done didly on that hence the aforementioned approval rating. And if all that doesn't get your heart palpitating...
5- Your Heart Medication Doesn't Work!!! Yes, it's alleged that Schering and Merck have delayed a report on Zetia for 2 years, and while they have collected $5 Billion per year, plaque in your arteries has actually been increasing rather than decreasing. Brilliant!
I think I finally understand why people don't "pay attention" to the news, or just sit around and watch ESPN all day. What does today's news prove? Both the media and special interests in our country are totally out of control. So, I'd take it all with a huge grain of salt, and perhaps mix in some ESPN, because it seems that if you watch too much news you'll end up being the perfect candidate for the depression medication that they'll be selling you at the next commercial break. Worse yet, it may be proven not to work after all.
1/18 UPDATE: NY Times Article Questions Anti-Depressants Effectiveness!

Tuesday Links

The Difference Between New York And Miami (RIS Media)
Sotheby's To Buy NY Headquarters For $370 Mil. (Bloomberg)
Trump Soho Accident Kills One, Work Stopped (NY Times)
Citigroup Takes $18 Bil. Mortgage Related Loss, Takes More Foreign Money (CBS Marketwatch)
Praise And Questions For $400 Mil. Affordable Housing Plan (NY Times)

Monday, January 14, 2008

Mortgage Rates Hit 2 Year Low And Look Lower

Mortgage rates, according to have hit their lowest level in 2 years with conventional 30 year mortgages now averaging 5.87%, while the jumbo has ticked to just under 6.5%. With an impending rate cut, and perhaps several more, the trend looks to be well established. Rates are actually right on target with my projection from the beginning of the 4th Quarter, when it was said on this blog October 4th, 2007:

"The 30 year jumbo mortgage rate is trending down. After a pop to 7.25% in August, the average rate now stands at 6.875%. While the spread between jumbo rates and the 10 year t-bill has narrowed, there is still a long way to go. The Libor rate has dropped by 1/2 of a point in the same time frame, and commercial paper yields backed by mortgages have dropped 1%. With another fed cut likely before the end of the year, and a slowing national economy, it looks like this trend will hold, and 30 year Jumbo rates should drop to 6.5% and possibly less by January."

At this point I would look for jumbo rates to drop to 6% by April, possibly a tad lower, and conventional rates will likely drop to 5.375% or less.
While the Manhattan market has held up remarkably well, there are still many challenges ahead in this election year. Fortunately, rates are not an issue, and this trend continues to drive the dollar lower and drive foreign investors into the Manhattan market. Additionally, such a trend in rates could help reduce the impact of the mortgage/foreclosure crisis nationally, as lower rates will increase refinancing activity and reduce the occurrence of foreclosure. Again, there are many challenges, but lower rates are a big help.

Monday Morning Links

What's Next For NYC Real Estate? (NY Times)
Curbed's Weekend Celebrity Real Estate Wrap (Curbed)
China Primed To Buy NYC Real Estate (Herald Tribune)
Battle Over Condo Conversions (NY Times)
Atlantic Yards Lawsuit Dismissed (NY Observer)

Friday, January 11, 2008

Revealed: NYC Pay Toilet's First Breakdown

Saved this one for today, as I didn't want to p*** on the parade on day one! On my second visit to the pay potty yesterday, yes, with Times photog in tow, I experienced complete malfunction. I was happy to get out, and the 3 CEMUSA techs that were on scene were able to get it up and running quickly. But what happens when they dont have 3 techs on site and it breaks down? How are the people who are supposed to have sex in there gonna wash up?

Weekend At Bernie's Crooks May Get Part In New Weekend At Bernie's Movie

If you haven't heard this story yet, it's a doozy. Just a recap. Two 65 year old men (with long criminal records), found their friend expired in his Hell's Kitchen apartment. They also found his social security check. Rather than call the police, they dressed the dead man, put him in a red office chair, and wheeled him through the streets of Manhattan to the check cashing establishment around the corner, flopping off the chair and all. Most people thought it was a joke or a stunt, but the dead man attracted sufficient attention propped up in the chair outside of the check cashing place that he drew a crowd including a police officer who was dining across the street. Well, the check cashing employees (who included the dead man's sister) would not cash the check, and by the time these two clowns exited, the gig was up.
Today, it has been reported by the New York Post and Fox News that the creator of "Weekend At Bernie's" is actually considering giving these guys a part in "Weekend At Bernie's 3". Stay tuned, as this story gets stranger by the hour! Only in New York!
Body Parts For Morons (NY Post)
Dead Man's Sister Worked At Check Cashing Store (City Room)

Friday Morning Links

Central Park To Clone "Historical" Trees (AP)
Hamptons Rentals Heating Up (NY Post)
NYC Leads US In Green Construction (Daily News)
Bloomberg Congestion Plan Inching Toward 60th (Real Deal)

Confirmed: Bank Of America Buys Countrywide

It has been confirmed this morning by Bank of America that the bank has reached a deal to buy Countrywide Financial, America's largest mortgage lender.
B of A Buys Countrywide For $4 Bil. (CBS Marketwatch)
Countrywide Gets Rescue Deal (WSJ)
Bank To Buy Troubled Loan Giant (NY Times)

Thursday, January 10, 2008

Breaking Reports: Bank Of America In Talks To Buy Countrywide

Word is out and it is being reported wide and far that Bank of America is in talks to buy ailing Countrywide Financial. It is reported that B of A, who invested $2 Billion in Countrywide last summer, has been in talks to aquire America's largest lender for the past week and a half. Countrywide, which reported dramatic increases in foreclosures just this past week, has been subject to bankruptcy rumors for weeks. The potential for a buyout sent the company's shares soaring in late trading today, for a one day gain of over 50%. Still with a close at $7.75, the stock is nearly $37 off of it's year high. Yet, such a buyout buoyed Wall Street's hope of avoiding yet another gruesome chapter in the sub-prime debacle and sent the Dow Jones Average to a 117 point gain on the day. Additionally, Fed Chief Bernanke, strongly hinted that he is willing to take "substantive additional action" to keep the economy growing. Such talk makes the likelihood of a 50 basis point reduction in the fed funds rate at the end of the month meeting or sooner a strong possibility.
B of A In Talks To Aquire Countrywide (NY Times)
A Rescue Mission (CBS Marketwatch)
B of A Countrywide Deal Near (
Countrywide Shares Soar (LA Times)

What's The Deal With....The New Pay Toilet In Madison Square?

It's finally here- New York City's first official pay toilet! For a mere 25 cents you too can enjoy the luxury of a clean space, larger than what some kids in the East Village are living in. This could be the best deal in New York. Your 25 cents buys you 15 minutes of solitude, three 16" pieces of toilet paper, a seat cover, warm and soapy water to wash you hands with and a hand dryer. Most people seemed a little confused at first about which button to hit for various functions, and the buttons are labeled only in English, so unless you read English, you may think that you are trapped in the facility. A three minute warning buzzer goes off after 12 minutes which may be equally disconcerting if you are the tourist who thinks he's trapped. Finally, there is a weight limit- 550lbs. So, if you are over 550 pounds and really have to go you find yourself with a potentially humiliating choice...the door will not close if you are over limit!

Lots And Lots Of Lots In Hunters Point, Long Island City

N. Side of 47th Ave (Vernon+5th St.)

So, you want to be a real estate developer? You want to build from scratch in an area that is growing by leaps and bounds? Well friends, Hunters Point might just be the place for you! It seems, I'm not the only one thinking so. Prices for vacant lots or tear downs in the area have escalated over the past couple of years. Prices are generally based on dollar per buildable square foot, and those rates which were around $150 per builable square foot in 2006, are now offered between $200 and as high as $300 per buildable sq. ft.. The area north of 48th Avenue from Vernon Avenue West and North To the Anabel Basin (45th Road), is particularly intriguing. 5th Street, for instance, 1 block from the water, has seen virtually every property between 47th Road and the Basin turn over in the past 2 years. Many see 5th Street as the next upscale shopping/gallery strip in the area. Between 5th and Vernon, there is no shortage of lots for the developer in you, although they do seem to be getting snatched up quickly.

What will be built in the area? I think it will fall into 2 categories. First will be the luxury condo. Given that most of the properties in the area are zoned for 6 stories of residential with buildable ratios of 2 or 3 times the lots size, I think you will see an abundance of 6 story condos with ample outdoor space. I call this the "Casa Vizcaya" model, for a condo recently built in the area under these restrictions. Condo prices in the area have edged over the $800 per square foot mark, so if you can manage to get a building up for $300 per foot, profits are in your future. The more these lots fill up with luxury condos, the more desirable, presumably, the area becomes. The second use in the area will be "community use". Community use could be anything from a hotels to dorms, and depending on the use, the city may grant you a variance to build more than the zoning allows for. There is a full block on 5th Street between 47th Ave and 46th Road, that is rumored to be a 13 story dorm for CUNY graduate students (unconfirmed). Such a height would be above the zoning limit and require a variance.

If anything, it should be very interesting to see how the area is developed. As of now, it is a blank canvas. A couple of years from now, expect it to look dramatically different, and if you have the itch to try your hand at development, now is your time.

Thursday Morning Links

Residential Brokers See Strong 2008 (The Real Deal)
Goldman And BRP To Invest In Harlem, Bed Sty (Crain's)
Zillow Adopts Data Standard With Yahoo, Trulia (Tech Crunch)
Gentrification Ebbs In Red Hook (USA Today)
Council Passes Plastic Bag Recycling Bill (NY Times)

Wednesday, January 9, 2008

Finally, A "Hip" Family Condo, "Georgica" To Grace Upper East Side!

(photo courtesy
Ascend Group, the super-hot developer of recent "A Building" and "133 West 22nd Street", is vowing to bring hipness to The Upper East Side with it's newly named "Georgica" condo at 85th Street and 2nd Avenue. Speaking with a principal of Ascend Group today, I was intrigued by the details. The architect on the property is Cetra/Ruddy of One Madison Park fame. The building will be 21 stories, house 58 "family-sized" units (no studios or 1 bedrooms), and pricing will be similar to The Brompton, somewhere around $1400-$1500psf to start. The name, "The Georgica", draws inspiration from the Hamptons, and the building sets out to be "not quite as formal" as The Lucida and The Brompton, while taking on a decidedly "hipper" and "boutique" feel. While being hip, it will still focus on catering to families. In addition to a long list of amenities, alongside the adult section of the roof deck with cabanas, there will also be a section dedicated to children. "Outdoor movies" for kids were also mentioned, an exciting prospect. The building will have a 421-a tax abatement and will incorporate "green elements". The location, despite being farther East than it's completion, is arguably better due to it's more residential feel than it's nearby competitors. You'll also have the Second Avenue "T" subway station just a block away (some day). The Georgica, with it's combination of concept, developer, and architect smells like a winner right out of the gate. Sales start in March and completion is expected in late 2009.

Wednesday Links

Corpse Wheeled Around Hell's Kitchen- Only In New York! (NY Times)
Subway Ridership Hits New Record (NY Daily News)
Lack Of Cheap Housing Leads Couple To Live On Boat For $800/Month (NY Times)
Ralph Loren Store On Madison To Get Makeover (The Real Deal)
More Congestion Pricing Plans Unveiled Thursday (NY Daily News)

Tuesday, January 8, 2008

Lucida Condo Rising

The Lucida is suddenly rising quickly. After endless work digging into the bedrock nearly 50' underground and next to the 4,5, and 6 line, The Lucida condominium is gaining momentum. Both the foundation and the base of the building are fortress-like. This is one solid structure. Sales have been solid as well. With prices starting around $1500 per square foot, and seemingly a year from completion, the building is reported to be a very solid 85% sold.

Tuesday Wrap Up

It's just another 68 degree January day here in the city. Strange isn't it? Change is in the air, quite literally. I'm not just talking about Barack Obama dominating the political dialogue, a beneficiary of the anti-establishment movement here in the states. Many things are changing. George Bush, for the first time in Seven years is acknowledging "challenges" to the economy, and the City is preparing for a huge decrease in real estate transactions for 2008 and 2009. We are all hoping for the best, but I think we need to take time out to thank Bloomberg for preparing for the worst. By preparing for the worst, Bloomberg insures that the City doesn't fall into fiscal crisis, and in turn, we end up surprising to the upside and are stronger for it. The City and National markets are related, but it seems only the relation of a third cousin. Strangely, the more dramatically the economy cools off nationally, the more it reinforces the positives for the New York market, namely lower rates and a cheaper dollar. We are in strange and changing times, but it doesn't mean that you can't enjoy it like a 68 degree breeze in January.
News Of The Day:
Mets Owner Wilpon Buys Devonshire House For $110 Mil. (NY Post)
Pataki Park? (Curbed)
Pricey Developments With Lousy Neighbors (NY Post)
Rents Expected To Increase 6.3% in 2008 (The Real Deal)
City Sees 33% Drop In Real Estate Revenues In 2008 (Observer)

Monday, January 7, 2008

Monday Morning Links

Spitzer To Cap Property Taxes, Hudson River Park Renamed Pataki Park? (NY Sun)
Celebrity Real Estate Wrap Up: A-Rod, Howard Stern, And More(Curbed)
Vornado To Buy Macklowe Debt? (NY Times)
MSG May Lose Tax Break (NY Times)
Upper Middle Class Getting Squeezed Out Of Manhattan (Crain's)

Friday, January 4, 2008

Friday Round Up

The world is still abuzz with the reports out yesterday from Elliman, Halstead, and Corcoran showing significant price appreciation and all around robust numbers for the 4th Q.. Today's real news came in the form of the weakest unemployment report in 4 years. Private payrolls actually dropped in December and the unemployment rate jumped 3/10ths of a percent. This weak number will only reinforce, if not speed up the trends which have strengthened Manhattan's real estate market- the cheap dollar and low rates. Such a report will likely accelerate the fed's dropping of the fed funds rate, which should (finally) result in lower mortgage rates. Look for fed to reduce the funds rate by 3/4 point over the first quarter. Of course, such moves will also drag the dollar lower vs. foreign currencies and in turn drive even more foreign buyer to Manhattan.
Jobless Rate Jumps (CBS Marketwatch)
Other news of the day:
Noho Development Reaches For Classy Status (The Real Deal)
Robert A.M. Stern To Design 60 Stories At 99 Church (Curbed)
Bloomberg Will Limit Parking Perk (NY Times)

Thursday, January 3, 2008

Manhattan Prices Continue To Move Up

An island unto itself, indeed. Reports from Elliman, Corcoran, and Halstead showed a wide range of numbers, but they all had one thing in common, they were up significantly. Average prices according to Elliman were up 37% percent to over $1.4Mil (including large sales at 15 CPW and The Plaza). Median prices jumped between 6% an 15% according to the 3 different brokers. Other numbers of interest included an inventory drop of 13.5% compared to last year and homes sat on the market an average of 18 days less to 84 days.
The cheap dollar, relatively low rates, and low inventory have been major drivers for the New York market. While most brokers are calling for a flat year in 2008, this broker believes we will see 7-10% price appreciation. Looking forward, fed funds rate will likely fall another 1%-1.5% to aid an ailing US economy. This move in the fed funds rate will result in lower mortgage rates and an even cheaper dollar, which will in turn keep the positive trends in place for the New York market.
Manhattan Defies Slump (NY Post)
Apartment Prices Defy National Slide (NY Times)

Wednesday, January 2, 2008

Wednesday Links

Spitzer On Development (NY Observer)
Looks Like LIC Will Be Crowned Neighborhood Of The Year (Curbed)
Coney Developer May Wait Out Bloomberg's Term (NY Post)
Existing Home Sales Up, Prices Down (NY Times)
Dottie Herman Shows Off Her Hamptons Getaway (Newsday)
NYC From A Montanan's View: NYers Are Nice (Flathead Beacon)

Happy New Year! Volume Picking Up!

On behalf of everyone in the A. Fine Company family, I would like to extend our best wishes to all of our readers and clients and wish all the very best of happiness, healthiness, and prosperity in the new year.
Just a quick note on the current market. At A. Fine Company, we have seen a dramatic increase in both web volume and sales volume over the past 2 weeks. From a web volume perspective, it was it's strongest since early October. From a sales volume perspective, the past week was one of our strongest of the year. It seems as if we have broken out of the traditionally slow season of November and December, and suddenly we are back in high gear. Time will tell, but the early returns look very good. Happy New Year, everyone!