This is a compelling video of Sir Norman Foster that was filmed in Munich in 2007 at DLD (Digital, Life, Design); a conference covering digital innovation, science and culture. He presents a macro view of urban design and public buildings that are sustainable and "celebratory". These are agenda setting ideas. He illustrates them using his own work; including the London Gherkin, and mega scale projects in China and the Middle East. In Manhattan, Lord Foster has completed the striking Hearst building on 57th Street and is working on one of the new towers on the World Trade Center site.

This is a beautiful loft building I'm representing that is being delivered completely vacant— ready for its next owner to make it into a grand townhouse, their company’s first headquarters, residential or commercial lofts with income producing retail that’s ideal for a restaurant or boutique. There's over 10,000 square feet of possibilities here. Its a gem to see. Located in the Ladies Mile Historic District, this 1903 building has an ornate facade, elevator, pressed tin ceilings and exposed brick on some floors. It is in excellent condition, currently configured as retail with four live/work lofts above. Download a property brochure for detailed information; see more pictures and highlights on the listing's page.

9 W19th Street is back on the market and will be delivered completely vacant. We had a deal on this which didn't close— creating an opportunity for a new buyer to maximize the building’s full potential. They will have the versatility to use it, convert it to residential or mixed use as-of-right; or lease it out commercially at current market rates.

There is nothing like it on the market of this quality, versatility and delivered vacant for $8,400,000.

download a property brochure (pdf 635 kb) for 9 West 19th Street
see this listing on comitini.com web id. 1008807
see this listing on corcoran.com web id. 1008807

Faced with only 24 hours in the day, I've been focusing on my core brokerage business and blogging a bit more lightly recently. I expect that the pace of posts will pick up again moving forward. I'm a real estate broker who blogs, not a blogger interested in real estate. Let's dive right in with today's report on the fickle first quarter of 2008. —Peter

download the complete Q1.2008 corcoran report
The Manhattan market has been interesting recently. It is hard to characterize it as either a buyer's market, or a seller's market. Its just a real estate market, and a more balanced one than in the last few years. People are considering their purchases carefully. We are seeing more offers starting below asking prices, yet well priced apartments are selling briskly, even with multiple offers. There is substantial buyer demand out there, but it's being tempered for the moment by uncertainty in the economy.

Customers are acting more cautiously since the Bear Sterns buyout last month. Whether the hesitation is justified depends on if you feel the fundamentals have actually eroded or not. How much damage to the global economy was caused by the sub-prime crisis is a matter of continuing debate. I've heard it described by some industry leaders as if you had a choice of 10 bottles of water to drink, but you knew that one was poisoned — you wouldn't drink any. The whole thing needs to unwind. However let me point out that the availability of credit for residential purchases has not been affected as much. Most people willing to put 20% down (less in some cases) and who have good credit ratings are still able to get mortgages at historically low rates. It's just a real estate market.

Additionally, developers now faced with putting more equity into their deals may put some of their plans on hold, restricting supply in the construction pipeline, and setting the stage for lower inventory a couple of years out. The available inventory of apartments in Q1 2008 rose to about 6% higher than in Q1 2007, mostly during the second half of the year as economic uncertainty began to cause some people to "wait and see". The number of apartments available to buyers in Manhattan bounced around 9000 units, but is trending higher, with more new developments coming online, and a buyers taking longer to decide.

The good news is that for buyers, this hesitation may have created the best opportunity to buy Manhattan real estate in the past 10 years, unless you feel that long term, New York City is spiraling downward into an abyss (a point of view that I haven't come across very much). There is a good selection of apartments available, and an environment more receptive to negotiating. No one is giving anything away, but fair deals are being struck every day.

mixed messages: what do the numbers say?

The hesitation has not translated into lower prices. The corcoran report showed that first quarter sales figures from 2008 looked pretty decent overall, but also showed that the number of co-op transactions has dropped 22% compared with a year earlier. Condo closings rose by 36%, and 60% of the condos were in new developments which have a greater lag time to being reported since they go usually go into contract during pre-construction, often many months before closing. They therefore don't actually reflect the current market activity as well as co-op transactions do.

click chart to enlarge

People still seem genuinely interested in real estate. 'New York Luxury Living' was an event hosted recently by the New York Observer at the Puck Building, which featured 40 new developments in a trade show style showcase. My agent friends were overwhelmed by the public response: 2,256 people paid ten bucks a head, to walk into a bazaar of developer's sales teams, hawking their products. That's way more than the expected attendance; "sorry we ran out of brochures", was the catch-phrase of the day. Newly developed condo sales accounted for a disproportionate amount of sales activity in the first quarter. This is sexy new product, with slick presentation. Could it be that older co-ops may need to consider doing that long put off lobby renovation or other upgrades, to help keep up with the market and hold value? Open houses for correctly priced properties under a million are busy, as are any where the perception of value exists. We price properties based on good research as to what has actually sold and closed, which always fare better than those based on competitive properties in this market. The marketing and sales management has to really kick in now, more than ever. It takes more than a few postcards and a web site to deliver results. Differentiating your home by graphic design, staging, a record of obtaining publicity, and an outstanding luxury broker network creates a more compelling proposition to help our clients achieve their goals.

I'll be focusing on sales in the downtown market in an upcoming post.

» download the complete Q1.2008 corcoran report

Nope, not an April fool's gag. It's been a gray and rainy start to the week in New York City, so let's take a moment for a tropical fantasy, and transport ourselves to our sunny little bit of paradise for sale in the Keauhou Bay Resort, on the Kona Coast, of The Big Island of Hawaii. The photo above shows a slice of the panoramic views from the large lanai, to the blue Pacific Ocean. The sunsets are stunning too. Lead an active lifestyle with all the Big Island can offer or just relax poolside. This condo is in a lush setting that we've had the privilege of enjoying, and are now bringing it to market for the first time in 25 years.

This apartment is in Country Club Villas, which has as its front yard, the 18th hole, on the manicured golf course of the Kona Country Club. The development itself is a meticulously kept, garden-like setting of tropical flowers and plants. It features three swimming pools, hot tubs, and tennis for the exclusive use of residents. The unit has cathedral ceilings, two bedrooms, two bathrooms, and a loft finished in rich native Hawaiian Koa wood that's big enough to sleep additional guests, with a den and home office. The property has good vacation rental income potential too, which can help offset the cost of ownership. This is a well managed property and very easy to own, even half a world away. See more photos and get the full listing details here. Please call our agent and resident property manager Erik Sandberg at (808) 937-7276 to schedule a viewing or to get more information. I'd be happy to answer any questions you may have too.

» Kona, Hawaii condo

Today's podcast from The Wharton School covers the past week's news developments on Wall Street and features a video interview with Professor Jeremy Siegel, as well as the usual audio versions. The Slatin Report also has a good read on it from a bit more of a NYC real estate perspective in Bear Bites Bear

Jeremy Siegel on Bear Stearns, Rate Cuts and the Looming Threat of Inflation

The ongoing credit crisis in U.S. financial markets has claimed a huge and high-profile victim: Bear Stearns, the Wall Street investment bank and securities brokerage firm. After being slammed by what amounted to a run on the bank during the week of March 10, Bear Stearns was pushed to the brink of bankruptcy and then agreed to be acquired -- for $2 a share -- by JP Morgan Chase over the weekend. Federal Reserve chairman Ben Bernanke and Treasury Secretary Henry Paulson played an active role in the transaction, largely because of the potential impact that a major bankruptcy might have on confidence in the financial markets. That same day, the Federal Reserve lowered interest rates -- as it did again on March 18, by three-quarters of a percentage point.

As the credit crisis shows no signs of easing, are other Wall Street firms likely to follow Bear Stearns into oblivion? Will the Federal Reserve's efforts help to boost confidence in the financial system among U.S. and international investors? Finance professor Jeremy Siegel, author of The Future for Investors, discussed these questions and more with Knowledge@Wharton.

A transcript of the conversation follows:

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The strength of an economy comes, fundamentally, from what it can produce. Can America still produce homes? Yes. Can America still produce desirable urban and suburban areas that people are willing to pay a fortune to live in? Yes.

It was a stormy week of news that rattled the financial markets, beginning with the collapse and buyout of Bear Sterns for a stunningly low $2 per share by J.P. Morgan-Chase. It sparked a crisis of confidence and some extreme volatility with triple digit swings in the Dow averages. After more rate cuts from the Fed, which also financed the bailout of the Bear, and some moves aimed at adding liquidity to the markets, the week ended with the them looking like they might be finally getting their legs back; with a couple of days of triple digit gains, and commodities like oil and gold dropping.

The confidence level of Wall Street investors may be shored up for the moment, yet it seems fragile too— like the next bit of bad news will once again have the potential to panic the market. The coming week will be telling. The bag of tricks that the Fed may have to quell the economic roller coaster is thinning, and is almost bound to backlash in this election year as the public sees aid for investment bankers as a high priority and ultimately a cost borne by the U.S. Treasury and taxpayers; while help for people who's home investments are underwater, is anemic at best.

Amid all of the dire economic news, there were also a couple of articles which offered some unconventional wisdom abut the credit crisis and housing. They talked common sense rather than fear. One of them was Can’t Grasp Credit Crisis? Join the Club by David Leonhardt in the New York Times who writes: "...the overwhelming majority of homeowners are doing just fine. So how is it that a mess concentrated in one part of the mortgage business — subprime loans — has frozen the credit markets, sent stock markets gyrating, caused the collapse of Bear Stearns, left the economy on the brink of the worst recession in a generation and forced the Federal Reserve to take its boldest action since the Depression?...I’m here to urge you not to feel sheepish. This may not be entirely comforting, but your confusion is shared by many people who are in the middle of the crisis." The theory being that confusion can lead to panic, can lead to an economic meltdown. The Fed did a good job of averting a panic this week, but the lack of transparency in the Bear deal was likely more of a factor in sending the markets sharply down. How was it that their share price went so quickly from $80, to $30, to almost worthless? What else is not being disclosed on the Street? After all the metrics are digested and debated, could it be as simple as that markets are profoundly psychological instruments? According to Mr. Leonhardt, Wall Street has been shell-shocked into an ultra conservative lending mode.

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Today's podcast about the credit crisis is from our friends at the Wharton School of Business. Despite the negative news about the national housing market, Manhattan's is still quite healthy. Agents at my office are reporting terrific turnouts at open houses, available inventory is shrinking, sales volume is roughly on par with a year ago, and I personally participated in a 'best and final' bidding on a property this week; which sold at over asking price. In contrast to that, the housing market as whole in our country is experiencing pain. As insulated as Manhattan's housing market seems, we still need to keep an eye on the market forces shaping the national economy surrounding our island. The podcast and transcript below, talk about what the most fair and effective approaches might be for government policy, to help relieve the pain.

Does the mortgage crisis demand a government bailout?

A year ago, most experts thought not. Sad as the situation was for some homeowners, many experts felt the problem would be confined to those who had gambled on risky loans with eyes open -- borrowers who chose adjustable-rate loans sure to require higher payments later, lenders who invented exotic loans likely to suffer high default rates, hedge funds and other big investors who had lusted after high-yielding mortgage-backed securities.

But things have changed. The mortgage crisis is behind a nationwide drop in home values and a crisis in confidence that is impeding all types of lending. People who did not choose to take risks are suffering, and more and more experts now say some sort of government response is necessary to avert a deep and prolonged recession.

"Now it's our problem, and it isn't getting any better. As we speak, it is getting worse," says Wharton finance and real estate professor Susan M. Wachter, who warned a year ago that the subprime mess could push the economy into recession. She favors new legislation or regulation to give trusts that control mortgage-backed securities incentives to work with homeowners.

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I recently sent a first time buyer that I'm working with, a purchase application for a co-op apartment that we have an accepted offer on. The buyer asked for clarification about the difference between the purchase agreement and the co-op's purchase application. It served as a reminder to me that every individual's real estate transaction is a very unique, important, and sometimes confusing experience. As a broker it is important to relay the basics for those who may have never been through it before. I took the time to explain in probably greater than necessary detail, and thought an excerpt of my response might be useful for those contemplating their first co-op purchase:

In effect, in buying a Manhattan co-op there are two hurdles, first to reach agreement with the sellers; then to reach an approval by the Board of Directors of the co-op corporation.

"The 'purchase agreement' is commonly referred to as the 'contract' of sale with the sellers, and is an element included in the Board package. It controls the process by which you and the sellers have agreed to transfer the shares of the corporation in their name. It dictates the essential terms of the sale including price, closing date, inclusions, exclusions, contingencies, etc... It is not binding on the co-op and its Board of Directors. Purchasers of Manhattan cooperatives must seek the approval of the Board to buy-in, and complete the transaction. The Board has the final say in accepting or rejecting an applicant. That process begins with the purchase application.

The 'purchase application' is made with the co-op corporation, to become a shareholder of a company that owns the building, and issues you a proprietary lease to occupy the apartment; in much the same way as a landlord does in a rental building. In this case the rent is called 'maintenance'. The Purchase Application outlines the documentation that the Board requires for review, to transfer the stock and lease to a new shareholder. It contains the required forms and disclosures by the co-op corporation and is the beginning of your prospective relationship as a shareholder in the company. As your broker, it is my job to assemble the documents that are asked for in the purchase application into an easy to understand 'Board package' that I'll then submit to the building's manager for distribution to the members of the Board. The process usually leads up to a face to face interview; and ends with an approval, or rejection, of the applicant. An approval is a green light to schedule a closing where the stock and lease will be transferred, after reviewing and signing a mind-numbing amount of legal papers."

In effect, in buying a Manhattan co-op there are two hurdles, first to reach agreement with the sellers; then to reach an approval by the Board of Directors of the co-op corporation. The process is rigorous, but the extra layer of oversight that co-op boards have imposed in NYC is one of the reasons why we still have a stable housing market here. It has created fiscal scrutiny and owner equity requirements that exceed most lender's underwriting guidelines. Many co-op owners come to really appreciate the control, along with their neighbors, over their common interest in their buildings, which this form of ownership governs.

We've reduced the price on this great mini-loft at the South Star condominium at 80 John Street in the Financial District. On Wall Street, buying stock on the dip is when you get the most bang for the buck— here's a buying opportunity near Wall Street that solid fundamentals too. Now for $699,000 you'll get a triple mint, mini-loft, with a private roof terrace, high ceilings, appliances by Bosch & Sub-zero, good light; and all in a doorman building. This is a resale so the seller will be paying the transfer taxes too. Download a fact sheet and get the full details and upcoming open house info here.

download a fact sheet (168 kb .pdf)
see this listing

Here's a new post from our friends at the Wharton School of Business about the recently announced economic stimulus package. I'll be getting back to regular postings as soon as a few deals I'm working on wind down. NewsReal will continue to be updated with my bookmarks about real estate as I read 'em.

Congress and the White House recently settled on an economic stimulus package with unusual speed, pushing the throttle to pull the economy out of a nosedive. Is this just election-year grandstanding, or does economic stimulus really work? And if it can work, what works best?

While some experts argue that priming the economy now is unnecessary, ill-timed or even counter-productive, those who support the concept applaud the design of the recently approved $168 billion package, centered on rebates of $600 to $1,200 for more than 130 million households. "They have moved remarkably quickly, so maybe this time it will, in fact, be well-timed," says Nicholas S. Souleles, finance professor at Wharton. Souleles conducted a study titled, "Household Expenditure and the Income Tax Rebates of 2001," that found a 2001 stimulus package did indeed help the economy recover from recession.

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I've been away from the keyboards this week, working with foreign investors looking for a building. It's the kind of work that takes a bit more shoe leather than condo sales, so my time has been stretched a bit thin. My assessment of the market right now is that despite the uncertainty about the economy, it has once again heated up in Manhattan. People are looking at the long term strength of New York City and deciding that this is where they want to be. The recent tic down in interest rates didn't hurt either. Investment quality buildings in the five to twenty million dollar price range are few and far between. Amidst the running, I did manage to post some recent articles this week to NewsReal, and came across a video Web log site that covers NYC Real Estate called IntoThe Box.tv, which posted the piece featured here on the strength of the Euro and how it's influencing real property sales in New York City. I'm curious to know what our readers think of the work on this site. I commented on foreign investment a couple of weeks ago when The Corcoran Report was released.

The ability to diversify into Manhattan property is something which Europeans, Asians and Middle Easterners are finding very attractive; but the deals have to work on their own merits too. The discount to the dollar is substantial, but the return is in dollars too, so the risk assessment to be made can be complex. With the dollar trading uncommonly low against foreign currencies it gives them an extra margin of comfort in their decisions. In condos, some are buying pied-a-terres for themselves, which is an easier decision based on need; while others are making traditional property investments and are seeking a return by appreciation over time, or by development. The understanding of the marketplace that a local broker can bring, and an attorney who can navigate our document heavy legal system, can be can critical to making successful acquisitions.

Updated 02.11.2008

the downtown skyline of 2011

The tallest residential tower to be built downtown, will be at 99 Church Street at the crossroads of Tribeca and the Financial District. Developer Larry Silverstein announced that the property would be operated by luxury hotelier The Four Seasons as their second New York City location, just at the edge of the World Trade center site. With the exception of the Ritz-Carlton at the Battery, Lower Manhattan lacks this level of accommodation. The Four Seasons' midtown branch is the priciest and arguably the best, in Manhattan today. Robert A. M. Stern Architects are responsible for the design. Mr. Stern's 15 Central Park West has recently sold to record setting sales figures, a fact Mr. Silverstein did not miss in his address. For this downtown project, he's given us another limestone clad building, but this one rises 80 stories with a tall, slender profile, and one would imagine, commanding views of Lower Manhattan, Brooklyn and New Jersey and the NY Harbor.

"I never dreamed that I'd build something right next to The Woolworth Building and taller than it too"

Much of the northern facade from it will look over low rise neighborhoods up toward Midtown's skyscrapers. It's in close proximity to Cass Gilbert's historic Woolworth building, and becomes a skyline element, referencing the older stone buildings of the financial district and bridging them with the glass curtain wall towers of the World Trade Center site. Surely a delicate position contextually for any architect to work in. Mr. Stern remarked after the talk that "I never dreamed that I'd build something right next to The Woolworth Building and taller than it too"

Built on the site of the 11 story former home of Moody's (now tenants at Silverstein's 7 World Trade Tower) the lower half of the building will house a 175 room Four Seasons Hotel with the remainder dedicated to 143 private condominium residences of up to 6500 square feet, with hotel services. It was further described as a limestone and cast stone tower that rises to a dramatic skyline profile of full-floor penthouses and setback terraces. The Hotel entrance on Barclay Street leads visitors into four floors of lobbies, lounges, restaurant, ballrooms, and meeting facilities, as well as a spa, fitness center and pool. A second entrance to the restaurant is on Church Street. The public rooms of the Hotel face a through-block landscaped public plaza framed by a lower annex building that conceals building services and access to below-grade parking. A separate entrance and lobby at 30 Park Place serves the Residences. Amenities for the private residents are located between the Hotel and Residences and include a 75-ft heated indoor pool, fitness center, lounge area, and children’s room. The project is also a green, LEED certified, sustainable development. Corcoran-Sunshine marketing will be the agency for the condominium residences when offered.

As a Tribeca resident I think that this is an appropriately sited and conceived property. While it is extremely large at 694,000 square feet, it has an elegant feel that is actually adding to the visual complexity that is emerging in the downtown skyline of 2011, when both it and the World Trade Center Memorial will be completed. It promises a decidedly up-market feeling to a somewhat dowdy part of the city and has the scale to be a major influence. It is not in the Tribeca Historic District, but close enough to bring patronage to the smaller boutique businesses here. In my opinion it should help expand the revitalization of the area of the proposed South Tribeca Historic District, below chambers and west of Broadway. It may well cause appreciation in values for nearby commercial and residential property. Would love to hear what our readers think of the design and their impact on the neighborhood.

Lobby and building plans continued after the jump.

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