Rushmore Buyers - Attention!!

More guesswork here, but I'm pretty sure the project would be insolvent at the prices in jim's example and therefore Extell would have no incentive to negotiate down to those levels, as their equity would be wiped out even at higher prices. Based on the $712M debt and approx 550k of sellable/rentable space, the developers avg cost psf is around $1300. Selling below this price on average would wipe out their equity. If realistic market prices are down 50%, and enough buyers walk away this project belongs to the lenders...and then it's a question of how quickly they can or want to foreclose, and begin their own efforts to sell the units. We haven't seen too many of these foreclosures in NYC, but I believe it's a slow process. Again, I stress, a lot of guesswork here with the numbers. If any of the people in contract have more detail they can do better work.

All the best to the Rushmore buyers. I'm also an unfortunate depositor on a downtown development - we're rooting for you.

In my opinion you guys are doing the right thing to ban together for better prices. You are getting ripped off. The area hasn't gotten better and the prices are way too high. Also, Extell is about to build on the parking lot and ruin all the views.

thedeuce, we will keep you informed. The evaluations from all of us are extremely important to our negotiation powere, whether it works or not.

If the project fails at anything near a real market clearing price, which seems likely, and you have a developer either in denial or who has some other agenda, then you need to get some idea of the financing angle:who, where, who makes decisions there. This may turn out to be an unfortunate timing issue where by the time the developer and financer face reality it is too late for depositors. Again, across this market, we are seeing something like paralysis,it seems.

Does the finance provider really prefer three years say of empty apartments where depositors walked away rather than make a deal now to induce them to stay? Probably not...but ...will someone DO SOMETHING, is another question.

jimstreeteasy, bring up URBANDIGS.com and read the article on Zombie condos. It is the second one down from the top. Would love to know your opinion and why he is letting the largest developers off the hook, so to speak. I believe these developers have the deepest pockets, but the greatest inventory.

Our little thread got picked up by Curbed.com!! We look forward to more Rushmore buyers joining our group - email rushmoreresidents@gmail.com

I misread the debt docs. The $712,000,000 covers both the Avery and the Rushmore, not just the Rushmore. So, 886,000 square feet rather than 565,000. Anyway, the financing behind this scale of development is so byzantine that without hacking into Extell's computers there's no way to find out anything useful.

for what it's worth, one HUGE factor here: Extell's Riverside South projects (Avery, Rushmore, Aldyn, whatever) are nearly wholly controlled by The Carlyle Group, and dealing directly with Extell here will get you running around with your heads cut off. Much to his chagrin, Gary Barnett (who single handedly makes even the most basic decisions on behalf of Extell) does not have enough authority to negotiate on the ppf @ these projects for the benefit of Extell. When Extell teamed up with Carlyle and took all the Carlyle money back in 2004/5 for Orion, Altair Lofts & Ariel East & West, then seemingly went crazy with the Riverside South plans, he gave up a great deal of control over "his" projects for the public spotlight as NY's force-to-be-reckoned-with uber-developer. I would start with contacting the few VP's of NY Real Estate Fund over at Carlyle first - in my experience, Extell will ONLY say no, and will allow people to walk away, keeping their deposits, simply to save face. The band (EDC) will play as the ship sinks fast, trust me.

are you kidding? call someone at carlyle and ask for your deposit back. that is hilarious. you need to get the guys on the radio from montreal who spoofed sarah palin on the case--maybe they could pull it off.

that is not at all what I said. my opinion is the purchasers will be able to get much further by going over EDC completely. think what anyone will about Carlyle, the fact of the matter is, EDC has tremendous ego, Carlyle could give two shits about their rep (obviously) and is only focused on coming out ahead.

cc - nice one. they could pretend to be the 'european buyers' that we always hear are going to save manhattan new construction.

I am an upper story buyer having put my near-$500K deposit in their escrow account, and I just read all 112 postings on this site. I must say that it cheered me up. My original plan was to sell other real estate in order to be able to purchase the Rushmore, but no one is selling anything these days, at least not at less of a loss than we'd take by giving up the deposit at Rushmore. Needless to say I worked pretty damn hard for this money (I'm not an heiress) and it's not easy to let it go. I agree that a contract's a contract, but I think we should organize a large group and approach Carlyle with a proposal that we won't forfeit our deposits go in exchange for a 35% price reduction on our units. Yes, the value of the units will probably go down more in the next few years before they go up, but we'll either be living there or renting the units, so it will just be an abstract loss, not a personal one, and we can wait around 10 years or so for the value to reassemble itself, assuming the entire world doesn't go to hell permanently. If it does, I guess we're back to the Wild West and whoever has the biggest gun gets the goods.