Rushmore Buyers - Attention!!

more bitter buyers. YAWN! If you don't like the price, you can always walk and give up your deposit.

Has anyone considered arson?

How much have they slashed prices for new buyers?

Whether you are in contract, or considering buying at the Rushmore, I think that it only serves you to join the group. We have gathered information that Extell is not sharing with potential buyers.

Alpine - your comment makes you sounds like a broker and we all know how unattractive that is.

If you don't have anything constructive to contribute then I suggest you refrain from posting. This is a major issue for all of us - if you had the amount of money at risk we do, I think you'd understand.

so SHUT IT.

jimstreeteasy - that's funny. there was a fire truck at the Rushmore a couple of weeks ago!

Alpine, I think that is their point. They don't like the price and will walk. As such, it is perfectly legit for them to negotiate a lower price as an alternative to walking. The developer has a right to let them walk as well if they don't want to renegotiate. I wonder how many in contract new dev apartments are this tenuous.

Thank you Rhino - that is correct. The decision to complete the transaction has to be based on market data - not throwing good money after bad. Extell may think that people won't walk away from their deposits because it is a large sum of money - but we are more fearful of how much MORE money we'd lose IF we WERE to close under this environment.

Topper - we think they's slashed prices up to 20-25% in some cases (depending on the unit, p/sq, etc.)

Thanks.

Can't help but think that a highly motivated, well-organized "group" effort could negotiate a win-win outcome.

Good luck!

Thanks Topper - if you know anyone who bought in the building - please let them know we exist!

Good luck Rushmore buyers! I'll be rooting for you.

The issue is, if you think the market will continue to fall...Is there any price they would give you that would be low enough? I would think you should all walk away. What good is a 25% discount in a market that is already down 25%-30% and will likely fall more? I guess your breakeven is your discount minus your lost deposit (10%?).

That's a good point - we can't judge where the bottom will eventually be since we are in the start of a multi-year decline (after a 6 year rally). This adds to the risk and uncertaintly we all face and can only be compensated for by Extell lowering the prices to the point where the risk/reward is in balance.

Deposit was 15%.

As long as you are organizing, it wight be wise to look into the rumor (here in the neighborhood) that the sweet little private park between 63rd-64th-West End-and The Rushmore-- may be sold to a developer. It is currently owned by the Brodsky rental building on 63rd. That deal would sure spoil some views.

hm...interesting. We were told by Extell that park was owned by the city?

Oh my goodness, that is very interesting since our condo would be facing that park. How can we find our more about this?

Doesn't it make the most sense for all of you to walk away? Is 20-25% enough?

We probably will...there is real doubt now as to the viability of the bldg and absolute stubborness on Extell not to make realistic concessions.

rhino86, your logic doesn't work for everyone. Assuming the deposit is a big chunk of their savings, they will not be able to take advantage of lower apt prices. If they close AND they are able to hold on, they might not take a loss and meanwhile live in an apt that they love (I hope). I agree it makes sense for some cases but your universal statement that "all of you should walk away" is oversimplified.

I guess the only way to look at it is relative to rent. Locking in a monthly payment even at a discounted price may not be more attractive than losing your down payment. My hunch is the developer is going to be stubborn.

i guess it's like everything else...can only be seen clearly from the outside. there won't be a happy ending here at any price---but the process has to unfold. bottom line (as I have said many other times) is that these people are lucky relative to many, many others in that they have the opportunity to cap their loss. let the dust settle and if you still have the means in a couple of years, buy in at a significant discount--think about how much better off you'll be than the poor souls who committed 100% for apartments 2006-2008.

columbiacounty, you don't know what the market will bring in a couple of years. It's wrong to give out a universal recommendation without knowing the individual's situation. And why is everyone a poor soul who bought between 06-08? I think you are overly dramatic. Most people are holding on to their apts and living there happily, no need to sell, no need to realize a loss.

Otto, tried to check into rumor of the West End Towers Park. How sure are you that it is owned by the Brodsky Organization? Where else would you advise me to check this out?

absolutely right, no one can tell with 100% certainty what the future will bring. however, if I had to bet -- I would bet on significant drops in real estate values in nyc and the rest of the country. given the choice of losing a certain 15% vs. the unknown future, I would easily take the 15% loss.

This park does NOT appear to be on the NYC park website: http://www.nycgovparks.org/sub_your_park/park_list/index.html

interesting...streeteasyfan. I am now trying to check out this Brodsky Organization.

the news (bad) just doesn't stop. http://www.nytimes.com/2009/04/15/nyregion/15develop.html?hpw

If a significant group of those pending closing jointly agreed to act collectively in a binding contract, and either walk away or get x discount, would that scare the developer (and the finance providers) because it would make the building fail? If so, and if this would not be illegal, perhaps that would work. One thing I don't know -- when you walk away from the deposit are you exercising a right to walk away, or is it that as a practical matter the developer can't practically sue you. If you have the right to walk away, then I think that the binding contract among similarly situated parties would be legal.

The contract we all signed is an "option" agreement, give us the option but not the obligation to buy at the contract price.

this approach works better in a john grisham novel or on tv. people can't agree on the furnishings for the lobby--good luck pulling them together in a binding contract with each one of them represented by a lawyer looking to find some edge for his client.

Obviously agreed columbiacounty. BUT..consider this: ..for those who are already planning to walk away but who would stay if they received a discount of x percent (and let's suppose there are a few), then they have NOTHING TO LOSE by signing a binding contract.

so long as x percent discount meets the level they would be happy with.....

which seems like a not-too-hard to arrive at figure, say something between current offering prices and the original contract prices

everything you are saying makes perfect sense. unfortunately, people in groups tend to not act sensibly. add some major six figure financial pressure, a couple of lawyers who like to hear themselves talk and voila!

Sure it is hard to get people on the same page and I'm sure Extell is counting on that. But like jimstreeteasy says, what do we have to lose? Extell is saying no to everyone ANYWAYS.

i have always been leery of the argument "nothing to lose" to support useless activities. related somehow to "too good to be true." no need to answer, but if you aren't in touch with at least 20% (and frankly, i think that's way low) of deposit holders, i cannot see how you would have any credibility with the developer.

p.s. just to be clear, i am not an apologizer for the developer nor gleeful at others misfortune. just urging good sense in a difficult and painful situation.

Your assumption that this is a "useless" activity is unfounded.

What is your intention in "urging good sense"? I think all readers on this board should be suspicious of your intentions - easy to hide under the guise of anonymity. What qualifies your comments to have any credibility with this group of buyers? Do you have skin in the game one way or another?

Totally see columbiapoint. So..I would suggest that a small core make an executive decision on a rather simple compact..and at least try to get others to join. To not waste money, get a lawyer from the group to help on the basic outline (surely there is one).

Just thinking outloud quickly, maybe the Discount Agreement would be a contract among depositors and the developer saying something like 1) developer agrees to give the "offered discount percent"), and 2) signed depositers agree to close, give up contingency option out, if "the offered discount percent" is equal to or greater than X percent. Every depositor signing the agreement could designate their own x amount, but if the deal goes ahead all depositors get the same discount. Basically, the contract would be signed first by a bunch of depositors, and then taken to the developer who would sign and indicate the "offered x percent", which would indicate how many depositors were bound. I think there is "consideration" here, so this should be a binding contract but I ain't practiced law in decades.

Obviously, if the developer offered below the x discount specified by a depositor, then that particular depositor would not be bound by the new Agreement.

How many total units, units closed, units pending closing at peak prices, uncontracted units?

no skin. no agenda. comments and suggestions are there --- take it or leave it. fyi---to be clear, my definition of useless activity is one that it highly unlikely to result in an outcome that is better than the status quo. so...it would be useless for me to try out to play for the yankees; it would not be useless for me to bid 1/2 price for an apartment.

Great suggesetion jimstreeteasy - thank you so much, we really appreciate the constructive ideas.

There are ~260-290 units (not clear b/c some have been combined. ACRIS shows 9 closings (substantially below plan), aside from ~10% investors that got bulk discounts and any other friends and family units, the bulk is contracted at peak prices. Over 110 units remain unsold.

I hate people that use "legal" challenges b/c they have no other leverage... I've been sued many a times, mostly b/c the other party had no leg to stand on and just wanted me to do lawsuit cost greater than negotiated settlement equation. FWIW, I've spent a ton of money for my principles and never backed down and never lost.

Having said that and b/f I get my bat out, I tried to be helpful with bds and said the only thing you can and should do is 1) ask and/or 2) consider it sunk cost and if you like it so much, buy a new "cheaper" unit and add your 10% loss and see if you are ahead.

If a guy buys call options in anticipation of GM going up and at the expiration date, the option is worth 0, does he have the right to sue the exchange b/c GM's situation is in flux w/ gov't bailouts? You played the game, be big boys/girls and walk away. Just imagine what you are teaching your kids, when you lose - SUE!

It sounds like you are saying 45% are contracted at peak prices not closed, 15% or so closed (wasn't clear), 35% unsold.

Of the 45% peak contractors how many realistically might walk? What -- being realistic -- is the market price they could be sold at vs. contract price if people walk? You need to make some assumptions about these things and try to find out....is large numbers walking going to bankrupt this project?, if so, I think you have more leeway if you can get enough potential walkers together. To understand this stuff you need to find someone who understands the typcial financing of a project like this.

And -- if you are going to walk-- and lose all that money -- I think it ought to be clear to the developer who is not cooperating at all -- that you are going to call as much media as you can, and scare enough people about the building failing that no one will buy there,and it will surely fail.

But...maybe none of this matters...because if 35% unsold they may well already effectively be bankrupt as a project, so even if all depositors close, it still goes bankrupt, in which case you may not have any leeway. In sum,I think your bargaining position depends on understanding the economics of the project and what the developer and financer incentives are.

w67thstreet - i think it is your assumption that the alternative is to sue.

jimstreeteasy - great points, we are working on getting more clarity from the real estate financing side of the picture.

agree with both of you. w67th--i too have spent too much money over the years defending myself (in business, not personally) from stupid lawsuits.

i think jim has done an excellent job outlining the size of the task just to see if its worth proceeding. one slight change, from my perspective, is that the money is already lost--may help to clarify your thinking about next steps.

Sunk costs are irrelevant,in theory, but psychologically, people would prefer to get in the building if they get a decent price, I assume.

W67th I don't think you read what this thread is about. I have outlined in another thread my view that a trumped up law suit is bad idea.

Here we are discussing something else -- economic incentives. Basically, if the project is not already so underwater that nothing matters so it is the walking dead, then there may be a case that the developer/financers would be better off to induce the depositor-potentialwalkers to stay and close by giving a discount. There may be value in collective action in that case. One could argue, I suppose, that if that were the case then the developer would already be offering a discount...but...the developer may be underestimating (or not !!) the willingness of depositors to walk. There may be bluffing on both sides.

bluffing, denial, wishful thinking, remorse, blame seeking...you name it, its there. not conducive to a complex negotiation requiring all parties to get far less than they expected or think they are entitled to.

Why is it logical for the developer to be so apparently indifferent to whether depositors close?

It doesn't seem logical if one assumes that some depositors would be willing to pay something above the current actual market clearing price, in order to avoid losing their deposit?

On the other hand, why would a depositor close if they can clearly buy the same unit now for a price that is below the old contract price minus deposit?

Maybe the developer thinks a significant portion of those depositors will close anyway without a discount; maybe the project is bankrupt no matter what, so nothing will save it.

not to be completely facetious, but what makes you think the developer is logical? why are they any more grounded in reality than any of the other stakeholders? logic left the table long ago and attempts to bring it back are met with great suspicion. my suggestion above that moving on might be the sanest course of action is clearly logical but not what anyone wants to hear.

wishful thinking and denial are still holding logic hostage.

Agreed. The problem in NYC -- and it is a big reason why any discussion of a "bottom" is ludicrous -- is that apparently a lot of new developments are in big trouble, but the tough decisions aren't being made yet. (Maybe the Rushmore people should go straigh to the finance provider..)

For market watchers, this may be yet another sign that the finance industry is still a mess, still in denial about the obvious, still mispricing assets, etc....

no doubt the finance provider is a securitized asset spread all across the globe. to the answer to our collective mess is obvious, but no one (and with good reason) wants to go first.

is constr finance securitized?...

jimstreeteasy, you have given us so much to chew on. Thank you. That is what this thread should be about, brainstorming.

w67thstreet - I agree 100%.

I can appreciate that those who rushed into the market and helped fuel the frenzy with down payments on overpriced condos now want a reduction. However, would they be willing to pay more than the original contract price if the market had gone up? I think this is a fair question. The developers/ land owners have expenses and heartaches as well. They would not presume to send a notice or lawsuit asking that because the market increased by an unexpected amount, buyers should pay more for their apartment than what was initially agreed upon, and bound by a legal contract.

This country was founded on laws, principles, and stability - the written contract being one of, if not the most important instrument in ensuring that stability. This is why we are able to sell so much debt to the world and finance our habits.

Without the sanctity of the written contract, what do we have?? Really?

I genuinely feel for the buyers misfortune, but by the same token, they signed a contract that they expected the developer to uphold. Now they should do the same, OR take the option of forfeiting their deposit, and walk away. Yes, it sucks, but trying to fabricate legal loopholes that are disingenuous is akin to the same behavior that led our economy into this mess to begin with.

Hypo represents a bunch of different lenders. The subordination agreement filed last month lists six mortgages totalling ~$712,000,000.

w67thstreet, pre-built apartment purchases are not ONLY an option. If that were the case, you'd be absolutely right.

In fact, these folks believed they were buying a home and made a downpayment. Both the developer and the purchaser miscalculated. By a lot. Why on earth wouldn't these people negotiate with the developer, asking him to take a haircut?

More simply, what's wrong with loss sharing? These buyers will have already lost 15%. To go through with the deal, they will be losing even more. Why shouldn't they offer to split this NEW loss with the developer?

The apartments total ~400,000 square feet, so Extell has to average ~$1750 per square foot to cover the mortgages. I may be missing some fundamental aspect of RE finance here, but looks as if Extell thought that was a feasible number back in 2005.

NWT - you are correct, they are expecting around that much for the Rushmore and even more than that for the next project that's already on the ~15th floor right next door to the Rushmore. I think they pitched ~$2K psf to the investors.

time to run for the frigging hills.

So far they have closed on $10 M worth of units out of $712 M in mortgages posted by NWT above.

Cannot find any connection between the West End Towers Park and Brodsky Rental. Anybody else know anything about this?

doesn't that strike you as fiddling while rome burns?

I have no clue how they are going to sell the Aldyn - i know part of it will be rentals the rest condos. But occupancy is declining in rentals as well. At the end of the day, the ones left holding the bag will be the bank.

and we know who holds the bag for the bank. lucky us.

HarlemNWP... are you clueless? F'k the next time you win the $400MM lottery, how about I go and share in your win! R u completely a moron or does the chemicals in Harlem affect your ability to NOT vote fro Rangel? !

bds and other Rushmore buyers/option holders... did a quick back of the envelope... given where the market is now and what the developer needs to break even and how they are holding to their guns on "re-neg", the entire project is under water.... I'm sorry but unless 1,000 Britney Spears decide the Rushmore is the best thing since sliced bread and want to pay $2,000psf.... the building will go under. On the bright side, I'm sure you can get great front seats on the bankruptcy auction in 4 years...

Listen to me NOW, the project is dead! Unless you want to live with a rusting crane while this goes thru the court system.... just walk away.

oh, you're so mean. how can you possibly know the future? what about my park? who owns my park? what about my amenities? where's my deposit. oh, can you be so mean?

w67thstreet - stuff the ad hominem

I was not suggesting that these people should continue with the purchase (I even clearly noted that to do so was to voluntarily pay more above the current mkt, beyond the 15% they've put in).

I do question calling an offer to the developer to lower the purchase price morally wrong. If you'd focused on the imprudence of buying here, as you do now, then I wouldn't have even posted.

anyone willing to pay $2K/sf deserves whatever they get.

All the moralizing is ridiculous. A deposit is the right to buy (or not buy). So by logical extension, renegotiation is fair. The more I hear about this situation though, the clearer it is that buyers should walk away. This sounds like a shaky project in a horrible market. At least ask for 35% off (group discount vs. currently offered prices)...This way you might get 35c off the dollar plus your 15c down...then at least you can begin to think about it as a decent investment.

Rhino86,

To be clear, are you suggesting that $3M original purchase, with $450K already paid in deposit, should now negotiate a purchase price of $2M, meaning that the buyer owes around $1.5M in financing?

Yes. I don't see why anyone would want to negotiate a higher price than what they are offering to new outsiders. The block of buyers have advantage over the seller. The seller has every reason to imagine if they are offering for 75 cents now, they will need to sell some at 65c. If the buyer offered 20c off, thats 20c + the 15c already down...to me its a given that the market will fall another 10c on peak dollar... In this new world, I can't see getting comfortable without more margin than that. A building this fucked up could easily be fire selling in a year at 35c on the dollar....yes 65c off. Yes, $600 a foot. That is the 2001 price.

RE: the little park. The signage outside the park clearly states that it is owned by the rental building. From what I understand, it was built as part of an abatement program when the building was constructed. Apparently, the period of abatement is ending (next year is what I heard) and thus the discussions about the land being sold. The park is NOT a NYC park.... it is owned and "maintained" by the West End Towers (which is owned/managed by Brodsky). They do have some issues keeping it clean, especially with the surrounding construction it's become a disgraceful mess at times. However, all of us in the neighborhood love the little park, and it's very popular with the nearby preschool kids. I hope that Extell is aware of this situation since they are certainly including the park in their marketing. It would be a terrible shame if the land were sold and developed.

Does anyone b/f a street brawl say "Hey stop the ad hominem?" But okay... let's say that again.. "HarlemNWP... are you illogical? Well, the next time you win the $400MM lottery, how about I go and share in your win! R u completely inequitable in your decisions and opinions or does the chemicals in Harlem affect your ability to think rationally?"

Let me get this straight... the people who were clamoring to get in on the Rushmore of course did their little, mortgage, downpayment, cc, re tax (abated for 10 yrs), current income/savings level, security/comfort at job, 30 yr commitment, possibility of market going down ANALYSIS before you signed on the dotted line, no? So you can still carry the monthlies for 30% of your pre-tax income, right? So what's changed? Just suck it up and move in... you guys are big boys/girls... use Moshe Moving, they are great.

Rhino86, so you and I know it's gonna trade at $.35 on the $1 in 3 yrs, but your advice is to negotiate 20% down....versus, walk away, rent for 3 yrs buy back at $1MM... so you are in $1.45MM plus 3 yr rental (let's say $7K/month) of $252K. You're still ahead by $700K by walking away..... I really hope you are not a ML financial advisor....

JOhnGalt195: I posted a long statement about sancity of contract on a similar thread. But that is not what we are discussing here -- this is a discussion of trying to use collective buyer action to negotiate with the seller, to see of the developer will possibly respond to economic incentives. If the developer would be better off to incent a large block of depositers to not walk, then maybe some depositers will be persuaded.

If the market clearing price for Rushmore is really down say 40% from the avg contract prices...then maybe the depositers should count themselves lucky that they didn't close. Or maybe they should take a very hard stance with the developer. Perhaps depositers could try to switch to smaller units at least, in combination with a price reduction, to reduce risk.

Thi building is so bad off , maybe nothing will work, but the fact is there is a large group of people who are motivated to try to do something to salvage their deposit..and might be willing to make some deal with the develoer. The alternative way well be that these units stay empty for years, which would make you think the developer/financer should want to make it work.

Again, sunk costs are irrevelant, but in real life, people do sort of care. And if all these depositers walk (what % will walk?....venture a guess), then this building is surely going down the tubes.

w67, I am not sure what your point is in taking a tough medicine tact on these people when it is clearly the option they paid for to be able to walk away from a deposit. none of us 'know' anything for sure, but if these people are looking for ideas...my advice was 35% off was the minimum discount I would consider. i also am not clear why you are taking an attitude with me. i said 65% off peak was plausible, therefore I am not sure why anyone would consider less than 35% off (50% off effectively given the 15c they have already put down).

PS: Go fuck yourself.

remember our earlier discussion about logic...same deal here.

Otto, here I am being more helpful. I am sure that park is part of the "public space" zoning build bonus that was part of the initial filings with the city. It cannot be taken away and in fact there are rules re public accessibility, seating, cleanliness etc. Hell if you want to piss them off, just call the Buildings Dept and have them give the developer a ticket.

Just ask the zoning expert at Troutman Sanders... just remember he charges $615/hr.

Depositers who have lost say 15% are a hell of a lot better off than recent buyers, it seems.

QUESTION: HOw many buildings are this bad off? This seems to spell significant bad news for the market if there a number of these.

65% off peak? What are you, on drugs? The only people mroe stupid than you are the idiots throwing tea into the river.

You have to wonder what sane bank would provide finaningn for a purchase in this place (or similar one) without 1) borrower mega-assets, or 2) mega-deposit like say 50% of acquisition price. If banks do it under any other conditions....short that bank.

Rhino I just finished fucking myself.. is that an ad hominem? Your math doesn't make sense, if you believe the market is gonna tank by 65%, use your option to walk away and rent. There are other options than buying in the Rushmore.

Just a couple of random thoughts

Why don't all the buyers drive their Bentleys, MB and RR around the hood and slow down traffic so that the developer cannot finish construction. I don't think you can get arrested for slowing traffic, but definitely for arson.

Correct me if I am mistaken, but "negotiations" happens before the signing of the papers. That is when you can say, I would like 35% off.

No sympathy for people who are bellyaching for a loss of 10% deposit. If you followed the rules of affordability, it should represent no more than 1/3 of your liquid net worth and this hiccup is just a bump in your financial future. But it seems to me that the lengths that people are willing to fight for their 10% makes me wonder if some of these buyers didn't leverage themselves even to hoard together the 10% to begin with.

Alpine if you think that -65% on a ridiculous $1700 figure for the West Side Highway is impossible you are an idiot.

Yeh alpine292, how many times I gotz to tell you $500psf prime UWS in 2 yrs! I'm with Rhino, who the heck would buy in the windswept WSH, boxed in by a housing project, tafficky WSH and the stretch of car dealerships on 57th street...

w67, why do you insist on saying I am predicting -65% rather than saying its possible? Don't be confused further by my saying -35% is the least buyers should consider by way of a discount. Also, why do you continue harping on the sanctity of the contract? expand your mind. buyers here are saying they will execute their right to walk away UNDER THE CONTRACT.

Alrighty I stand corrected. Possibility of 65% decline, I think the probability of 65% decrease is 99%. If they are asking for 35% at a minimum and the discounts being offered are 25%, then walking walking away and waiting 6 months and rebuying would effectively put you pretty close to the 35% discount needed. Okay, agreed on that point.

"alternative actions" does not equal walking away. Me thinkz most if not all of these "home-buyers" are trying to use the threat of a protracted lawsuit/or brow-beat ALL unit owners in similar situation to threaten to walk away to "game" the system.

The last time I checked a seller has the right to lower prices and a buyer is not forced to buy at a certain price. Why is this any different b/c there is a lag between paying 10% upfront and paying 90% later?

The threat of a lawsuit is not going to scare the developer. They have lawyers working for them and know the laws better than the buyers do. After all, THEY are the ones who wrote the contracts, not the buyers.

alpine, your comment shows your ignorance of legal issues. the presumption usually falls to the party who did NOT write the contracts, as traditionally they are deemed to have less negotiating power in the buying process. this is not true in the case of two sophisticated parties with equal input into contract terms.

not intended to be legal advice, in any shape, form, intimation, whiff, approximation, etc.

oh, for god's sake, the developers are gonna go bust...go sue them...good luck with that. after that, you can sue obama, maybe george bush...try mayor mike...at least he has some money left.

cc, i wasn't intending to say anyone should sue, btw. i think people should run, not walk, away. these new developments have all the potential of becoming horror shows, for both the developers and the purchasers. everyone should hope that their development goes bust before their closing date, but sans such a lovely outcome, unless the development is 80% closed without massive numbers of rentals, I'd say get out of Dodge.

sorry...missed your point...agree 100% move on and rejoice in the mess you have avoided.

coming in a bit late here, but the numbers quoted above... $712M of debt on the project for 400k sq feet. those costs ($1780 psf) cannot be right. i'll have to check with a friend who knows a lot more about new construction but i've never heard of a development costing that much to build. did the offering plan perhaps say there was $712M of secured loan capacity? but maybe not that much was drawn? it's relevant here to understand where the avg psf where the sponsor goes upside down.

There's another 165,000 square feet of retail, garage, and "community space". The $712M is what they borrowed; dunno what they spent.

AN EXAMPLE THAT SHOWS WHY A DEAL MIGHT BE LOGICAL: ...does this make sense?(done quickly so there may be a blooper in the numbers..or assumptions)

FACTS: Contract price is 100; deposit =15; realistic market price = 50, ie developer will have to sell at 50 to clear the building. Obviously, Depositors will not close at 100, so they walk away and lose deposit. Depositors CAN rebuy at 50 in the market, in which case seller has gotten 50+15 from that Depositor, but not many Depositors in reality will turn around and buy, and some will not even be able to because they have lost their liquid asset with which to be able to make a deposit.

SOLUTION: Developer agrees to split the difference with the Depositors, so that Depositors buy at the "market" price of 50 plus 1/2 the deposit amount, ie for a price of 57.5 (and gets full credit for the deposit, so pays a net of 42.5). Now, Depositor is happy because it gets some benefit for the deposit in that he is really buying at 42.5, and lives where he wants to live. Developer is happy because he has sold a bunch more units now, for sure, rather than three years from now.

ISSUES:

- You could argue the developer is worse off because in effective recieving a net new 42.5 , BUT to be realistic, everyone knows all these numbers are fuzzy in an illiquid market, and a bird-in-hand is worth something.

- The idea of selling units anywhere near a market clearing price of say 50 probably means the project is bankrupt so really ONLY the finance provider can make this strategic decision, and they may not be at that stage yet.

- Even if this deal could be struck, there is a big risk that it will be done at a very large headline "discount"...say 40% or whatever.....that will still be above what is the realistic market price of the building and the depositors will simply be overpaying, even getting credit for their deposits.

Jimstreeteasy, keep it coming. You are a sage in this morass of trouble. Thank you.