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Excerpts taken from The Real Deal commercial newsletter mailings.
2007 record year for new developments
Signs of a bubble top...
According
to a year-end report released by the Corcoran Group, 2007 was a record
year for new condos in Manhattan. The volume of new development sales
increased 42 percent compared to the previous year and accounted for
about 30 percent of total sales. The median price of a new condo
increased 30 percent to $1.205 million. New condos saw a 10 percent
increase in price per square foot compared to the prior year,
increasing to $1,323 per square foot. Big-name properties like the
Plaza, 40 Mercer and 40 Bond drove sales prices to a peak in the third
quarter, the report said. TRD
Average
rents fell this month for Manhattan apartments, according to The Real
Estate Group's monthly market report, defying the traditional seasonal
trend of a January rebound after a slow December. The downfall was
widespread, encompassing all unit sizes in both doorman and non-doorman
buildings. Doorman studio rents were hit hardest, with a 5.4 percent
decline from December to $2,608. The next largest drops were in
non-doorman one-bedroom rentals, which fell 4.3 percent to $2,807 in
the same period, and doorman one-bedrooms, which fell 4 percent to
$3,634. more By James Kelly
The
number of new building permits issued by the city's Department of
Buildings dropped by 22.8 percent in the first half of fiscal year
2008, from July to December 2007, according to a department report
released earlier this week. The number of violations issued by the
Department of Buildings increased 2.9 percent from 11,979 to 12,332
over the same period. Meanwhile, the number of permits issued for
alterations increased by 4.5 percent. TRD
Average
home prices in metro New York dropped .81 percent from October to
November, according to the S&P/Case-Shiller Index, which excludes
condos. The index also indicated a drop for New York of 4.8 percent
from the year before to 203.88 in November 2007. This dive was less
steep than that of the report's 10-city index, which fell 8.4 percent
from November 2006 to November 2007, the index's largest year-over-year
decline ever. The 20-city index fell 7.7 percent over the same period,
also a record. TRD
More
than just the design of 15 Central Park West makes it a throwback --
the limestone tower has small staff apartments on separate floors,
meaning the price range for units swings from under $1 million to $20
million and beyond. The buyer of unit S702 paid just $690,000. Also
Tuesday, the same buyer -- listed on the deed only as Southfork
Holdings -- purchased a condo there for $10.5 million. According to
Streeteasy.com, the cheapest unit at 15 CPW had been $710,000 for a
studio. On floors six through eight, 21 studios and three one-bedroom
units range from about 350 to 500 square feet, Bloomberg reported. TRD
The
Brooklyn ZIP code 11233, which includes parts of Bedford-Stuyvesant and
Crown Heights, had New York State's highest rate of subprime
foreclosures in October, according to a Federal Reserve Bank of New
York report. The area had 194 subprime foreclosures out of 770 subprime
borrowers, a rate four times the national figure of 6.89 percent.
[Bloomberg]
Macklowe reaches deal over debt
Struggling
real estate baron Harry Macklowe has reportedly reached a deal with
Deutsche Bank to hand over control of seven Manhattan office buildings
he acquired less than a year ago for $7 billion. Macklowe would still
retain his title and Macklowe Properties would still manage the
buildings. His $5.8 billion debt was due on Feb. 9; now it has been
extended while the buildings could be marketed for sale. Many observers
say that Macklowe overpaid when he spent $7 billion on the buildings,
and say their value has dropped since he bought them at the height of
the city's real estate boom. [WSJ]
Macklowe could sell GM Building this month
Developer
Harry Macklowe could reportedly sell the General Motors Building this
month to pay off debts with Deutsche Bank. Bids for the 50-story
building are due Feb. 15. Macklowe made his stake in the building
collateral for a $1.2 billion bridge loan by Fortress Investment Group,
which financed the $7 billion acquisition of seven Manhattan office
buildings last year. The cost of borrowing has shot up by one-third
since Macklowe bought the buildings, said Scott Singer, executive vice
president of New York-based Singer & Bassuk Organization. While
some say Macklowe paid too much for them, Howard Michaels, chairman of
New York-based Carlton Advisory Services Inc., said Macklowe "paid an
appropriate price at the time he bought the properties. It was a major
score for him. And it was unforeseeable by him or anybody else that the
market would change so drastically." [Bloomberg]
Spitzer: State “struggling” with runaway building costs
Gov.
Eliot Spitzer, in a somber address Thursday to New York City's
developers, said runaway costs and delays for big public projects
threaten the city's standing as a world capital. Spitzer's speech to
the New York Building Congress centered on how costs threatened to slow
a range of projects, from rebuilding the Tappan Zee Bridge to
reinventing Governors Island. He called the growth in construction
spending, driven by skyrocketing commodity costs, the state's “biggest
problem.” Spitzer said he had urged commissioners at the Metropolitan
Transportation Authority and elsewhere to get serious about controlling
expenses on major projects. more By Alec Appelbaum
Hotel boom spurs fears of over-supply
A
boom in hotels has been encouraged by the record high occupancy rate
recorded last year. But some question whether too many hotels are being
built and wonder if the amount of tourists taking advantage of the weak
American dollar could decrease if the global economy weakens. The
amount of visitors to New York City in 2007 was up 5 percent from the
2006 record of 43.8 million. To meet the demand, hotel inventory is
increasing by 20 to 25 percent. [Sun]
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