speculation on 15 CPW

ask malraux. "his" is decorated with art.

steveweaselby:

You sound a little....cranky.

You know very well mine is rented out with a mulityear contract, "not decorated!"

yeah i own a couple too. but only one is "decorated"

is hear there are foodlines starting in 15CPW with all the I-bankers that need to carry the monthlies on this thing... hmmm maybe for this building, I'd do $1,000psf. Nothing like rubbing it in your neighbors faces how cheap you got in for... (it's the opposite of 2007, when everybody was almost rubbing it in how much you paid for, like it signified how smart and wealthy you were.)

When I saw the prices on 15CPW, I knew that had to be the top... b/c it was based on my "penis" is bigger than your prices... to be pc (my labia is bigger than yours prices)

:)

first line should read "I hear"

Wow....LOTS of cranky people on the boards today!

malraux: i take it that you own at 15 CPW? I tried to pull a similar thing off (buy new construction from plans) but fell flat on face with the flip. I take my figurative hat off to you. What made you buy there as opposed to somewhere else?

15 CPW is a second-rate building that caught the top of the real estate/hedge fund/wall street bubble. It manages to be conventional, derivative, and ugly all at the same time: a rare architectural feat. The apartments pale in comparison to high quality prewars or to modern glass towers like the Time Warner Center or Beacon Court. It was built to appeal to people with a lot of money, no taste, and small penises. Now that a lot of those people are running low on $$, it is being revealed for what it is: nothing special.

penis are my blogging area HR... I've trademarked it :)

nyc10023:

I bought there strictly as a very long term rental investment. I had a bit of an 'inside track' on the building, as I knew the attorney who was writing the offering plans early on, so I was able to get in at a very favorable psf rate pre-initial offer. At the very early price I paid on a psf basis, it was pretty clear that this specific building would be a winner, even given the eventually predictable Manhattan real estate correction/crash/depression/whatever you want call it..

And boy, happyrenter, speaking of cranky...!!

And w67th - the correct comparative analogy is "ovaries," as in "Man, she's got a big pair - of ovaries!"

Hmm, I hadn't counted on how much people go for the traditional faux-prewar look. I was surprised at how much units were renting for. Congrats on a great deal.

Also we would have to live there, and my spouse doesn't want to live south of 63rd...

Take 'traditional faux-prewar look,' and add brand new everything (plumbing, electric, heat, etc.) plus amenities up the wazoo (including pool) and add a direct unobnstructed Central Park views from the unit in question...

malraux, unless you paid a significantly sub-offering-plan price, you are not getting a good rental yield at 15 CPW. I don't really see how this could make sense as a long term investment for rental income. I've seen what apartments have rented for and sold for in that building, and the yields are nothing short of awful, say 2-4%.

malraux is a personal friend of the Zeckendorf's and let him buy in for 900/psf

As a broker who has done deals in this bldg, I must say this is one of my absolute favorite places in NYC. If you aren't living there its probably because you can't afford it. I would buy in at $3K psf in a heartbeat if I had that kind of money. I am sorry I didn't buy in at the initial offering when prices were better. Every client I've ever worked with that had tons of cash and wanted a condo, has always chosen 15 CPW over EVERYTHING else I've shown them. nyc10023 - as a downtown gal I can say with confidence that your spouse would have no prob living south of 63rd if you bought him/her a pad here.

"If you aren't living there its probably because you can't afford it."

I can't decide if this statement is more stupid or condescending. You're not winning any friends or clients here...

AgentRachel: can you elaborate? I'm surprised that a large set of people with that kind of money would all wind up at the same conclusion, tastes being as individual as they are, and with people like that inclined to be picky. what factor (or factors) made it such an easy call for them?

A few reasons anotherguy. #1 - very few CONDOS this close to central park. If clients want a co-op, that's another story. #2 - common charges and taxes are great for this type of property. #3 - LOVE that this is a brand new bldg but has the look and feel of prewar. #4 - AMAZING service/amenities. Anything you could want really. To tell you the truth though, you really need to see to understand. Its just amazing.

malraux... blah blah blah.. medical 101... the development of the actual penis occurs at the same point of labia majora and minora in a female. If I'd said gonads.. .then it'd be ovaries.. I chked with my wife.. I should say asked... she's a physician specializing in southern end of a person : )

I'll buy your unit out of receivership yet young man/woman... Gotta admit, my best deals in NYC were on the "inside" :)

AgentRachel: 2006 tweeted and they want their lame go-go broker pitch back. And their tanning salon coupons. And their 10%-Off-Lexus-Detailing promotions. And their Glamour Shots appointment. And their...

malraux... I guess my $1000psf number got a little too close for comfort... for your financial health I hope you didn't re-fi after getting that I-Banker to sign the multi-year rental (I used to work with the work-out department at my bank, and just when you think you're covered, somebody comes along and crams you down). If you re-fi(ed) at $1,500psf and took that extra money to buy the F430, go on some nice trips to the 4seasons Maui, and took the rest to double down in the Hamptons - ohhhhhh... no wonder a guy who owns at 15CPW has nothing better to do than figure out where NYC RE is heading...

My suggestion to you is to sell to AgentRachel at $3,000psf... ooops I forgot the only people that could actually afford $3000psf were RE Brokers/I-Bankers in 07' with NINJA loans... my bad.

ARachel..... just sign here.. I'll get you $2999.00 for every dollar you put up. :)

It was just that kind of thinking that got us here, no?

malraux... before you "lash" out at me.... remember "MERITOCRACY".. I gotta drop off kids at school, w/o (maybe see you at Reeboks), and meet wife for lunch... then I'll be back. :)

Holy===poop.... I almost forgot... Arachel... the reason I love NYC is b/c of all the cool things that I can do once I step outside my apartment.... if you wanna cacoon yourself it's much easier to do it in Chicago... ask rufus.... where is rufus?

Agentrachel,

I have been in 15 CPW, I have friends who live there, and I have been all over that building and pretty much all the other top buildings in the city, and I just disagree with you: it's a very mediocre building. It may be true that your clients all choose to live there if they can afford it, but that just means they are boring and have no individual taste. No one would rather live down town, or on the East Side, or in an apartment with a much better view (like at the top of the Time Warner Center), or in a real prewar, or in a building with interesting architecture, or in a building with a lower profile? Boring, boring, boring.

But my bigger quibble is with point 3: LOVE that it looks like a prewar but is brand new. Now, I certainly see that this is a big reason people have chosen to pay up to live in this building, but that doesn't make it a good reason. Can it really be that the ne plus ultra of New York City residential architecture is faux-prewar? I mean, at this architectural moment we have the option of various forms of modernism, post-modernism, and, for lack of a better word, experimentalism, but Robert AM Stern opts for copy-cat, and you consider that good taste? 15 Central Park West is a Manhattan version of a McMansion: a brand new house with fake shingles stapled on the front and a two-story atrium entryway that calls itself a "colonial."

Within postmodernism there are architects who use pastiche and visual reference. But no one is going to look at a post-modern building and think it "looks like a prewar." One would see the references to prewar buildings--like, perhaps, the Time Warner Center towers echoing the Majestic, El Dorado, and San Remo (not that I think the TWC is particularly interesting architecture, but at least it makes an attempt). Simply trying to build something that looks like something else is not what I call architecture.

happyrenter: My initial rental yield (after all carrying costs) with any new piece of investment real estate is modest, at around 5%. But that's the way I've always worked with my real estate investments in NYC. Of course, as time marches on over the years, the carrying costs continue to remain fixed, but the yield gradually and continually increases. In ten years, it's an entirely different story. And again, in the meantime, some other person is essentially buying this condo for me. All I had to do was pay the down payment and closing costs.

w67th: man, what are doing up at 4:00 a.m. on streeteasy boards? Anyway, yeah, my buy-in at 15 CPW was around $1,000 psf (just north), a number that I'm QUITE comfortable with. I've never re-fi'd any of the residential real estate units in NYC that I own. Never believed in that kind of financial approach to investment real estate. Not my style.

I don't see how it's possible you started with a 5% rental yield at 15 CPW--I've seen the numbers from that building, and it was never 5%--as I said, unless you are Zeckendorf's son-in-law or something and bought in pre-offering at a significant discount. The numbers simply do not add up to anything like 5%.

I assume you paid cash for the apartment, because if you financed it there is, again, no way that the rent would cover anything close to monthly mortgage payments.

happyrenter: I don't know what to say to you. I'm not going to discuss actual numbers, as that's private info. I did not pay cash (never have for an residential Manhattan investment property). And whether you like it or not, the amount I am renting for actually does cover all carrying costs plus puts a bit in my pocket, and that's that. And by the way, the same thing goes for some others I know who were also smart enough to rent out quickly and quietly, and not hold out for some insanely high 'broker induced' rental amounts.

As to your whole schtick with the aesthetic of 15 CPW, I agree with you (sort of). But your aesthetic arguments make you a lousy real estate investor. I'm not buying property for investment sheerly because of its aesthetic value alone (though, of course, aesthetics do matter to a certain point). I invest in Manhattan residential real estate properties that have (as a Manhattan real estate investor with two decade's experience) qualities that I feel will make them very desirable as a rental, even in tougher economic times, and will also be units that will sell strongly (in relation to the givens of the real estate market at any given time). 15 CPW was a real estate investor's wet dream. And it will remain that way, regardless of your endless whining about the "aesthetics" and "Stern's vision" and "postmodernism" and blah blah blah. Most of my investment properties are in the Village, because I have spent two decades investing in that small and controlled area and know it like the back of my hand. 15 CPW was an anomaly for me, but it was clearly a slam dunk from an investment pov, so I had to do it.

You don't invest in real estate; you only offer opinions from the safety of your armchair; you have no experience in the matter. Perhaps you should tak chill pill and calm down a bit. Telling me what's "not possible" or "no way" something could happen just makes you sound angry or nutty, and I don't think you're either. I just think you don't speak from experience.

malraux, i'm not going to get into the insults and name-calling game, so i'll leave that alone.

clearly we can't talk about the numbers since you won't reveal what they are, but there's just no reason for me to take your claim of a 5% yield seriously when i have personally seen the numbers from the building, know people who own there, and know what the rents have been. your claim is even less believable when you say that you rented out "quickly and quietly" and did not hold out for the "insanely high broker induced" rental amounts. even those insane rents did not result in a 5% rental yield, and you rented yours out for less, ergo....none of this adds up to 5%. you don't want to share numbers, fine, but there is no reason to take what you are saying seriously.

as for my "schtick" about the building being ugly, boring, and derivative, well, that's my view of the building. i certainly never claimed that aesthetics are the sole, or even primary, or even secondary, or even tertiary consideration for real estate investing. i do think they are relevant, but that's not why i brought the issue up. if people want to claim that 15 CPW is a successful development, well, that's obvious. if they want to claim that people made a lot of easy money on flips, that's for sure. but when they start saying that it is a great building, obviously aesthetics are a critical component of such an assessment. you can't say "it's a great building, but it's ugly, derivative, and has mediocre apartments." a great building is great because it is imaginative, beautiful, unique, has wonderful apartments, and resides in a great location (15 CPW certainly has a great location). this is not a great building in any sense of the word great.

now, as to the investment, since you won't share numbers i can only use the numbers i have seen, and i highly doubt that this building will prove a solid long-term investment. clearly it was a successful short-term speculation for flippers, but that's a different story. i do think that over time the ugliness of the building will become a major drag on apartment values there, but even aside from that, the apartments just aren't that great. flavor of the month.

lastly, you're absolutely right that i am not a real estate investor. i am an investor. numbers are numbers, and whether it's real estate, banana plantations, convertible bonds, commercial paper, public equities, or widget factories, i know how to calculate a 5% yield. if you think i operate from the safety of an armchair, it's only because you haven't seen my office or my portfolio. i've been on this board a lot the past month or so because i am weighing when and if to step in and buy another apartment. this is not primarily an investment decision--it's primarily personal--but since i don't mind renting i just want to get the best apartment for my money either way. so, i'm paying attention and doing research like i always do.

if it sounds angry and nutty to say that something is not possible that isn't possible, then i'm angry and nutty.

"You know very well"

I know nothing. Only what you claim.

"this is one of my absolute favorite places in NYC."

I'd have favorite places at 6%, as well.

happyrenter: If you don't know the purchase price or financing terms for Malraux's investment, and you only have a vague idea of the income stream, how can you know the range of "possible" yields"?

Poor happyrenter. You're just like steve. Once you get a bee in your bonnet, it's only possible for things to be the way you see them, even if you have no direct experience in the matter - according to you, it's just simply impossible for anybody else to be correct. And then you rabidly go after anyone whose opinion diverges from yours, and post over and over and over again, each post becoming longer and more insistent.

"...but there is no reason to take what you are saying seriously..." Fine - so don't! I don't really care whether you take me seriously or not. But it seems awfully important to you to be 'taken seriously.' Why else would you mention your "...office or portfolio?..." You sound like you're overcompensating. It's rather sad, really...

"...as for my "schtick" about the building being ugly, boring, and derivative, well, that's my view of the building..." EXACTLY RIGHT - it's just 'your view,' and nothing more. It's a 'great building' to me, because it's great as an investment. And that's all I really care about. I don't live there.

"...I highly doubt that this building will prove a solid long-term investment..." Yes, well, as I've been doing Manhattan residential real estate investment for two decades and you haven't, you'll understand if I follow my own inclinations here, right? After all, as you say "... I am an investor. numbers are numbers..." My numbers over 20 years add up to a something significant and solid for me.

And it does sound angry to say that something is 'not possible' even when it is, particularly when you admit that don't even have the facts or any direct experience in the matter. SO I guess you're right - you are angry. But about what, I don't know or care.

west81st,

he won't share the numbers, so going off the numbers i know from the building a 5% yield is not possible, that's all i'm saying. i admitted that if he got a highly favorable inside deal on his apartment then anything is possible--he could be getting a 50% yield for all i know. all i can comment on is what i know about the building, which happens to be a lot in this case, and the numbers i have seen do not add up to anywhere close to a 5% yield.

malraux,

you're rude and insulting. as i said, i am not going to go there, so since essentially the only things you wrote in your post were insults, there is nothing to respond to. how about this: i'll put you on ignore, you put me on ignore, and we can be blissfully ignorant of each other.

Yield is meaningless.

What does cash flow positive mean if its a cash flow positive loss?

happyrenter:

Me, rude and insulting? REALLY? YOU'RE the one who brought up your office and portfolio, not I. YOU'RE the one who finally admitted that your feelings about 15 CPW are simply your 'view.' YOU'RE the one who doubts other's investment returns with no facts and little or no DIRECT experience putting your money where your mouth is in either this specific building and/or Manhattan residential real estate in general. YOU'RE the one who said "...if it sounds angry and nutty to say that something is not possible that isn't possible, then i'm angry and nutty..." If you don't like being called to the floor when you try to shove others around and essentially call them liars, then look in the mirror when you call others "...rude and insulting..."

nyc10022:

In essence, I agree with you completely. And since my specific situation at 15 CPW is one that is cash flow positive/positive, it's rather 'meaningful' to me.

The crash just started, and you're celebrating your "win"... interesting.

Celebrating? No.

Comfortable with defending this particular choice? Yes.

And to repeat what I have said on these boards multiple times before, this retrenchment is going to present some amazing opportunities in the next few years for me, and I'll be looking very hard to acquire a few more properties - but I think we're nowhere near capitualation - yet.

Malraux, last comment:

It is typical of a braggart to assume that others are bragging. I mentioned my office and portfolio in response to your comment that I am "in the comfort of my armchair." You, who go on and on about your art collection, or apartments, you investments, your 70+ apartments, assumed that I meant I have a nice office and a big portfolio. That's not what I meant at all. I meant I have a busy office and an active portfolio--no armchair quarterbacking here. You brag, so you assume others are bragging. That's not my style. I'm 27 years old; the only way to be super-rich at this age is to inherit or start facebook. I did neither.

I believe that all caps is the internet equivalent of shouting, no? deep breaths please. since you don't pay cash for your real estate investments, you currently own highly leveraged assets in a market in which both rents and sale prices are declining. no wonder you are so stressed out.

I'm not sure if AgentRachel is being serious about everyone taking 15 cpw over any other condo building. I know 3 people who had opportunities to buy there but opted for other buildings instead. One chose time warner because of the ridiculous views and amenities, another chose 40 Bond because she's more of a downtown person, and the third bought at 101 warren.

oof, sorry, i can't help myself--gosh, you love to make stuff up. I did not "admit" that my opinion of 15 cpw was "simply" my view. i stated that my view of the building (that it is ugly and mediocre) is my view of the building. well, of course. who's view am i supposed to espouse other than my own? this is not an admission--if anything, critique me for stating a truism. what are your views, the gospel truth? yes: when i state my opinion, i am stating my opinion.

"...It is typical of a braggart to assume that others are bragging..."

Oh, now who's looking in the mirror?

"...who go on and on about your art collection, or apartments, you investments, your 70+ apartments,..."

Art? Yes. Rental units? Yes. Investments? Yes (well, not really anything in equities at the moment). 70 apartments? No - try about 11 currently, including the one I actually live in.

"...I'm 27 years old;.."

Oh, hell, well that explains everything!!! I've OWNED investment property for almost 27 years! HAHAHAHAHA! I'm talking to somebody who didn't even live through the last downturn in Manhattan (as an adult with awareness, at least), and whos entire investing "life" (such as it is) is only informed by a vertiginously expanding market until about thee months ago. You've pretty much experienced.....well.....absolutely nothing first hand. I mean, I'm sure you're a swell kid and all, but.....

"...you currently own highly leveraged assets in a market in which both rents and sale prices are declining..." Most of the places I currently own I bought over seven years ago (and some much longer ago than that), have drawn significant continuous positive cash flow income from them, and many are now largely paid off, thanks to 'happyrenters' such as yourself. Assets? Yes. Leveraged? Nope.

As to your "opinion," well, being that you're all of five years out of your undergraduate degree, tops, like I said, I'm sure you're a swell kid, but no one in their right mind would take your opinion seriously about the long term reality and viability of 15 CPW as an investment.

> I'm 27 years old; the only way to be super-rich at this age is to inherit or start facebook. I did
> neither.

Actually, Wall Street used to be on that list... I knew a bunch of folks who got in early at hedge funds etc., got principal status, and took awful big chunks of change home.

Malraux: I was debating between buying in at 15CPW or downtown at the same price points and bought downtown. Hindsight is 20/20 and instead of making out like a bandit, I got my hands burned. My mistake was thinking that it was boring, blablabla, faux prewar and all - confusing my personal taste with that of my target audience. I can see why (in retrospect) it's an easy sell than some of the other ultra-luxe stuff. Location, you absolutely cannot argue with; amenities - top notch; architecture - fits the broadest spectrum of taste.

But you have to look forward. I think in NYC, location is #1 and prewar (faux or not) is #2.

nyc10023, is the amenities at 15 cpw any better than the other luxury condos?

Rufus, amenities (plural) ARE, not is.

North of 60th Street, yes. I think 15CPW beats all the others hands down. Interestingly Glenwood has an ultra-luxe rental on Bway and 64th/65th with very high price points that has never had much in the way of vacancies (I know, I've looked there a few times during the time we rented). So I think there isn't much in the way of ultra-luxe uptown. Ariels E & W/Trumps are within range in terms of amenities, but handicapped greatly by location.

i'm tired. but thanks for being the grammer nazis.

So how do the amenities stack up to other comparable condos?

Yes, that rental in 64th is the grand tier. I'm pretty sure it's the most expensive rental building in NYC. The penthouse unit was renting for around $34K/month.

I was actually referring to peer buildings like time warner, one beacon, park imperial, etc. It seems like those are 15 CPW's closest competitors.

nyc10023:

In all my looking and looking and looking at downtown "new" builds over these past many years (starting ever since the Meier buildings first went up), there was only one 'new' build downtown that I ever wound up buying - and it wasn't a 'name' starchitect place at all! I bought it as my actual residence because the location was terrific and the specific unit had all the bells and whistles that I wanted in a home that I knew I was going to live in until they took me out feet first in pine box. So truthfully, I didn't buy that place as an investment (don't care whether it goes up 40% or down 40%) because I don't view it as part of a portfolio or count it as an asset - it's just my home. But aside from that, all the other downtown places I've ever purchased have not been 'new' builds. Just never saw one that really excited me from an investment perspective. I though 40 Bond would do it, but it didn't. I thought One Madison might, but I didn't like that either. I thoought 100 Eleventh by Nouvel looked interesting, but I passed. Just not for me....

That's what I was trying to say. If you want to live on the Upper West Side - aside from Time Warner (which has a different feel because of hotel/office/retail mix) - no building comes that close in terms of amenities. One Beacon/Park Imperial are different locations. I think that was one factor that I neglected in my analysis of whether to buy in 15CPW. I had no idea that there was that much pent up demand for ultra-luxe on the Park, on the West Side.

Ditto for Grand Tier. I didn't think people were willing to pay that much more than what they paid before to live on the UWS in a rental.

Malraux, I think you have a better bead on the pulse of "mainstream" $$$ RE taste than I do. Anyway, I have learned my lesson downtown and will stick to the tried and true. Which to me, is buying townhouses in great neighborhoods. Unexciting, but if I see any opportunities in the village, I will jump. What do you think of the Downing St. listing that Vandenberg has - it's around 4m (can't remember the last price cut).

I do wish downtown had more new luxury buildings, not conversions. There just aren't that many ultra-luxe new condos with great amenities.

100 eleventh is a great building, but its location is gonna kill it.

The other thing, because there are always tenements and stuff that can be torn down downtown, is I feel that there will always be product that's cooler out there. But one thing about 15CPW (again in retrospect), is that there is nothing from 60 to 96th that can be developed - unless the synagogue on 70th (Shearith) or the NY Historical Society can add on. Also there are a couple of Church of the Scientists (not sure if they're landmarked).

There is a lot of demand, which explains why prices are so high at buildings like 15 cpw or time warner. As opposed to Chicago, NYC hasn't built that many new luxury condos in the last 5 years that are in good locations. So the ones that fit the criteria will sell at really high prices.

There is a lot of demand.... As opposed to Chicago [with no demand]

Rufus finally right for once.

Well, the prices are high because of limited supply. If you only have a few condos that fit this criteria, it's logical that prices will be really high. Because Chicago has so many brand new condos with nice amenities, the prices will be lower due to much higher supply.

Rufus, you can't take it back now..

"There is a lot of demand.... As opposed to Chicago"

Demand doesn't come from supply....

You said it, demand is lower in Chicago.

If supply is lower for a desirable product, prices will be higher. What part of this simple economic concept do you fail to understand?

nyc10023:

Would LOVE LOVE LOVE to do brownstones in the Village(!), but there's just too much risk there for me with the amount of capital it ties up at any given time. I think I know that townhouse you're referring to on Downing - it still seemed a bit high to me, as it appeared that significant work was required, no? Also, one of the prime reasons I initially seriously looked at 15 CPW was your cogent observation regarding the fact that "there is nothing from 60 to 96th that can be developed" directly on CPW - this was (probably at this point) the ONLY game in town for a new build directly on CPW for the foreseeable future.

rufus:

I agree completely - the location of 100 Eleventh was precisely the exact reason why I passed! Had that building been better located, I would have really run the numbers hard on specific units to see what I thought. I think it will still be a beautiful building to look at, though. But the location - blech!

malraux, the location is beyond horrendous. The city needs to clean that area up before developers can actually put up luxury condos. It's too bad that NYC has so few prime real estate areas.

rufus:

The truth is that the location of 100 Eleventh is not a residential area, nor is it being packaged as one by the developer. This is a gallery area, for people who enjoy daily peregrinations amongst the art galleries (and the the gallery quality is quite phenomenal). It is, after all, a warehouse district, and understood as such. So it doesn't require much cleaning up. It's pretty clean as is, considering again, it's a warehouse district. So those who choose to live there know what they're buying in to (at least, I THINK they know what they're buying in to - you never know!).

My guess is the vast majority of those who bought units there did so as an investment. Most people would not want to live in that area.

ooops look what i started...

Malraux... I have a pituitary issue that enlarges my penis and gets me up at all odd times... great when I I-banked... :).. . I have a 5yo and a 3yo with colds... I don't know what day it is much less the time.

There you are rufus...

malraux... hmmm you are an old timer... and if you blend in from 1980, I can see how you are on a portfolio basis yielding above 5%, probably closer to 30% on a cash on cash.... send out 11 bills, deposit 11 checks a month.. .that's hard work but someone's gotta do it. We have much more in common than I thought, I'm closer to 40 but saw the 87' to 95' doldrums where I bought more on the commercial side and did some flips (for you youngins... a true flip is when you put down 5% and then assign it someone (better if you have someone lined up) and pocket the change and never take title to it)... all this buy, renovate... sell is called "DEVELOPMENT" or "REHAB") I digress... Good for you malraux... I also respect your morbid humor about leaving horizontally... cause nothing like seeing the new batch of mini-me(s) to know the conveyer belt just keeps on going.

Let me ask you this as you will probably part of the vultures that will put a bottom in NYCRE, what is you bottom $psf on 1) 15CPW and 2) standard UWS 3brm (1800 sq ft) doorman bldg, decent view... -I know it's generic, but pls do some neuron transfers to the next generation :) PLS, PLS, PLS :)

I don't know about that, rufus. First, those who bought had to know about the complexities of the location. Secondly, due to the initial cost (and the location), I don't think there was a real (serious) consideration of these units being easily 'flips.'

> If supply is lower for a desirable product, prices will be higher. What part of this simple economic
> concept do you fail to understand?

But supply doesn't change demand, idiot.

You had just the one correct part

"There is a lot of demand.... As opposed to Chicago"

15 CPW will bottom about where I initially bought in, I'm guessing $1,000 - $1,200 psf. This $3K -$4K (or more) psf stuff is/was absolute short term nonsense. IT'S OVER, PEOPLE! Time to get real, if you bought to flip (or have to sell due to a situation beyond your control).

Your 'standard' UWS three bed/three bath 1,800 sf doorman decent views/light is tougher because 'standard' is a general term. I'll further assume good move-in condition (nothing has to be redone, everything looks fresh and nice), building is a co-op, moderate board, well-run, no more than $2,500 per month total cc/tax/maintenance (hopefully closer to $2,000 per month) I'll hazard a guess bottoming around $600 - $800 psf for such a situation. Though significantly less psf is probably guaranteed for such units and the absolute nadir, but I think you'll being giving up views/light/condition/location/etc. in that case.

> hazard a guess bottoming around $600 - $800 psf for such a situation.

I think you've got it...

nyc10023 the townhouse on downing street is not much, i looked at it last week. it's 16 feet wide, has no garden, needs work, and the street is less than ideal. it has little potential for conversion to single family.

The house to keep your eye on is 97 Barrow--the cheapest real townhouse in the WV at the moment. I have the sense that these people would really like to get it off their hands, if things get a lot worse it may trade at a surprisingly low price.

malraux, if you think 15 CPW will bottom at $1,000 psf then we don't disagree; that would make it a pretty horrific investment for the people who bought at the prices i have seen. if you really got in at $1,000 psf, i am curious what sort of unit you bought. if the average for that building, including the penthouses, apartments on the park, etc, really sank to $1000 psf it would be nothing short of an investment disaster for the vast majority of buyers in the building. the only question would then be how well it recovers. here, we may disagree: i think that the ugliness and mediocre quality of the building will be a drag on appreciation going forward, you seem to feel otherwise. but we should both agree that an average psf of $1000 for that building would be a disaster for the vast majority of the owners.

honey! honey! did you hear what malraux just said... I told you I was right for letting that Grand Millennium unit go! Pack up your bags.. .I need to sit in cabana #3 at the 4seasons maui to gloat and tell you how smart your husband is....

FYI malraux... I knew the NYCRE was out of control when in 2004 my wife and I bid on a 3bdrm at the GM for an amount that was more than all my investments in NYCRE for the period of 1995 to 2003... and I got outbid! I decided to rent and wait it out... and this week saw a unit that just got listed (on a $psf basis saved me and my honey $500K)... showed it to her..... She asked me what I wanted to X-mas.. I said I would like a highly depreciated 997 Turbo (2007') - even with having two kids in private school... and having that wonderful "nesting/saving" female gene, she didn't hesitate and said "go ahead." Better than being right about NYCRE, that yes is priceless to me.

All you youngins... listen to Malraux... he speaka the truth.... :)

happyrenter:

97 Barrow is interesting. It could be a little jewel box of a home with a complete reno, if you were willing to invest the time and money. A lovely, sweet location.

As far as 15 CPW, it's just like 1989/1990. There were lots of people who bought SoHo back then at near the-then-unheard-of price of $1,000 psf (four figures psf was some kind of mystical, hypothetical number in the late 80's real estate boom). And these were very nice lofts, mind you. Then they sank like a stone to $500 psf - and quick! Then they rose like a meteor to nearly four times that. Same thing'll happen at 15 CPW. Some people who bought strictly for investment will get hosed due to greed. Some people who bought to live there won't give a rat's ass because if their place goes down by 50%, they've still got more money than they know what to do with, and that's where they want to live, and their home is not by them viewed in any meaningful way as an asset, investment, or any part of their net worth. SO the psf value will go down, without a doubt. And then guess what? Eventually, at some point in the future, it will go up again. Me? I bought a 2 bed/2-1/2 bath unit facing the Park for investment. All I require is a renter to keep paying the carrying costs every month, and call me a 'happyinvestor.'

w67th - 2004 indeed was when things started getting really nonsensical. I sold a couple of units in the past four years, just to take a little cash off the table somewhere in the vicinity of the top.

I hope your kids feel better soon. Being sick over the holidays really sucks when you're a kid!

malraux,

come now. just because someone has a lot of money doesn't mean he doesn't mind getting hosed on an investment. i once saw michael bloomberg haggling in a flea market (before he was a celebrity mayor). no one will be pleased to pay X for anything and then discover that they could have bought it for x/3 a year later. i'd also say that it is going to take a bull market that makes the 90s and 00s look like a blip to make your scenario play out: apartment prices in the building decline from, say $3500 to 1,000, and then end up at $7,000 in short order? I just can't imagine that happening.

and i don't want to get back into it, but 2 bedroom units facing the park were never offered at $1,000 psf. how did you arrange that?

happyrenter:

Disagree completely. I knew what was inevitably coming in the market, and still proceeded not only with the purchase of my present home, but with an additional complete gut reno (and it was a new build!), specifically because I wanted it the way I wanted it DESPITE the fact that I recognized the coming market shitshow - I knew it would be my home, and simply not a part of my 'portfolio' or asset base or net worth or whatever you want to consider it. Bloomberg aside (and we're members of the same 'tribe' with the same basic shtetl mentality), that's just the way it is. On the other hand, there's no doubt all lot of investors will get hosed by their greed as well. It takes a village....

"...apartment prices in the building decline from, say $3500 to 1,000, and then end up at $7,000 in short order? I just can't imagine that happening..." And that, grasshopper, is why you should not invest in real estate. In the same manner, some people could have never imagined that places selling at $500 psf in 1991 would sell for prices exceeding $2,000 at the top, or that Village townhouses which sold for $2MM - $3MM at the bottom of the 90's would sell for in excess of $10MM not too recently (though not in 'short order,' as you phrased it).

As to my buy-in price for 15 CPW, I was more at the top of that range around $1,250 psf. I arranged it as I arrange any buy ins that I do in new builds (which as I said above, are few and far between, as I am not a general fan of newer builds in the majority of cases). I have contacts with the lawyers who write the majority of offering plans for new builds in Manhattan. So I get the call on new builds very, very early, well before the public role out.

malraux,

You hazarded a guess at $600-$800/sqft for your 'standard' UWS 3BR/3BA...what kind of range do you see for a pre-war 2BR/2BA or a Classic 6?

There is a large difference between the people bought in early at 15CPW vs. people who bought later. There were a lot of people who didn't sign contracts on the first go around.
I was willing to pay 1800/sqft for a 3 bedroom. Woulda, shoulda, coulda.

Right now (as in this minute, today, this week), contracts are being signed at around 900/sqft on the UWS, in nice prewar coops, given good light and reasonable condition.
Will this head to 500-600? I think it quite possible since I just moved to Manhattan when things were 300-400 on UWS and the economy was much better.

malraux, hold on a second. there is a big difference between apartments going from 500 to 2000 psf over a 16 year period (1991-2007) and apartments going from 1000 psf to 7000 psf "quickly." very, very different propositions. making 4x your money over 16 years means a doubling every 8 years, which is a return of 9% a year--perfectly nice, but not spectacular. for comparison, the dow went from approximately 3000 in 1991 to nearly 14000 in 2007 (since we are going by the peak), which would give you more like an 11% return over that same period.

"Quickly" can at most be defined as 5 years, but I'll grant you 10 years to make it fair. Making 7x your money in 10 years is possible, sure. That would require a compound return of approximately 20%. Is that really what you are predicting?

Happyrenter: you know who the owner of 97 Barrow is? Edie Falco - I don't think she's hard up for cash.

My bad, Edie sold to Paula Cole (another showbiz gal) in '05.

happyrenter:

I said prices DROPPED very quickly. Then prices rose 'meteorically,' meaning in terms of amount, not in terms of time. Sorry for the confusion.

nyc10023:

Paula Cole owns 97 Barrow? She's got a nice set of pipes.

Malraux: Thank you for your input here. Great reading, and lots to ponder for us sideliners.

I second that. Invaluable talking to someone who's bought, sold, and has a real estate portfolio over the last 20+ years.

Told you malraux is the man.... HR... l've posted this before, but there are no other financial instruments in all of I-Bankingdom that will allow any joe schmoe to leverage themselves by 10x, nay 20x , nay 100x. Your comparison to the stock market would be correct if you were able to leverage yourself to the same degree and there was no mark to market... The last time I chked Etrade, they allow 50% leverage... and if it goes below $2.00 then it's 0%, forced margin selling... (I had to fund some dumbass trades I made.... nothing like bleeding all over yourself from catching a falling knife )

In addition, I'm sure alot of malraux's Four Seasons tab is "business" related as well as "scouting trips to Hawaii" and the leased Maybach that he needs to be slumlord... no offense given:)

Kudos to malrauz for getting 1250 psf at 15 CPW, it's a great deal. Wanna sell it for 1300 psf? ;)

Malraux: you might want to be a bit circumspect about your buy - not hard to be outed with combination of 1) Park view 2 bed at 15CPW and 2) 1250/sqft.

i'll take it for $1350 malraux!!!

1350 sf I mean!

malraux, i've followed this discussion with interest as well, despite having no interest in 15 CPW.

Here's my question for you: In your view, was the latest run-up in NYC real estate similar to the 80's run-up, or significantly different in any way? Or, to ask the question differently, was the most recent run-up typical, or unique? I think the nature of the run up (bubble?) affects both the downturn and the subsequent recovery. For example, the 1997-2000 tech/internet/nasdaq bubble was of historic proportions, and I think it's safe to say nasdaq is not likely to return to 5,000 anytime soon, let alone 10,000 or 15,000.

This is not intended as a leading question, even though it may sound like one. I am closer to happyrenter in age than to you, and moved to NYC in the late 90s, so really don't know about the 80s run-up or 90s downturn firsthand. Thanks.

"15 CPW will bottom about where I initially bought in, I'm guessing $1,000 - $1,200 psf."

Wow. That is one of the most bearish comments ever made on this board.

nyc10023:

All my investment real estate is bought under the name of my blind trust - so no worries re: anonymity. And speaking of blind trusts - John Stewart has the best name ever for his blind trust - it's called the "Shamsky Monkey Trust!" How great is that?

newbuyer:

The run-up itself was not unique. The ferocity and vertiginous nature of the run-up was unique. I've never experienced anything like it in my lifetime, and never will again - that's for sure.

"All my investment real estate is bought under the name of my blind trust"

Well that confirms it. Malraux is a fraud. Anyone who actually bought real estate through an LLC or a trust would know the difference.

http://en.wikipedia.org/wiki/Blind_trust

A blind trust is a trust in which the fiduciaries, namely the executors or those who have been given power of attorney, have full discretion over the assets, and the trust beneficiaries have no knowledge of the holdings of the trust and no right to intervene in their handling.

The amount of detective work done on Streeteasy is truly amazing.

Who knew there were so many aspiring RE investors/CSI/Forensic Specialists on here.

jgr - I'm the trustee, dum-dum. Congratulations on being able to go to wikipedia! Next time try employing some of your own brain power (if you have any). The trust was set up by me in this fashion a long time ago for the benefit of someone else for tax purposes - obviously, the beneficiaries do not know the nature of the property held in the trust, and have no involvement in or knowledge of my trustee decision-making. The trust also keeps my beneficiaries identity out of public record. (I should add, however, that many states STILL require that a trust divulge their beneficiaries internally to the state - but not the state my trust is set up in - or not yet, anyway).

My bad, however, saying that Stewart's trust is 'blind' - it isn't, I'm sure - that was typo - sorry - but I just love the name of it!

You're full of shit and now dancing.

You used the same context for "my blind trust" and "Jon Stewart's blind trust". "My" implies ownership - no trustee would be stupid enough to say they own a trust as they don't. You're mention of Stewart is a common tactic employed by people who are pathological liars and scam artists. An anecdote here, a famous name dropped there all to garner more credibility for the lie you tell.

Next time use your "brain power" to come up with a better cover story. You're not impressing anyone on an anonymous forum.

malraux,

these are not your investment properties at all then: they are owned by someone else. you are merely a fiduciary. you are the equivalent of, say a board member for a non-profit. no one would say that the board members of the metropolitan museum of art "own" the met. and when the museum buys a work of art, they don't claim that it is 'their' art. you should be more clear about this: you actually own no investment properties at all. someone else owns the properties, but you make investment decisions of their behalf. you haven't explained why the trust is blind; that is, there would have to be a reason why the beneficiary or beneficiaries cannot know what is in the trust. do you mind sharing the reason? in my job in asset management i deal with a lot of trust situations but the only blind trust i've dealt with involves a high-profile news correspondent.

in the future, before saying that other people are operating from the comfort of armchairs, you should be clear what your actual exposure is. your exposure to investment real estate is actually zero, since "All my investment real estate is bought under the name of my blind trust." they are not "under the name" of the blind trust, they BELONG to the blind trust. in other words, they belong to the beneficiary or beneficiaries, not to the trustee.

"I bought there strictly as a very long term rental investment."

"My initial rental yield (after all carrying costs) with any new piece of investment real estate is modest, at around 5%. But that's the way I've always worked with my real estate investments in NYC."

and most damning...

"Oh, hell, well that explains everything!!! I've OWNED investment property for almost 27 years! "

What a crock shit.

jgr, don't know who you are, but your obsession with malraux is a little alarming. He's contributed far more to this board than you have.

2 comments on the same thread is alarming? Do you get frightened when the lights are turned off?

And I could give a shit what he's contributed. He's made up an entire persona and tried to pass himself off as something he clearly is not. He's a fraud.