Toren

Did you check out the showroom on Henry and Clark for 20 Henry? Halstead handles that building as well as Toren. They are only asking over $1000 psf with a nice view of Poplar Street. Any discussion about buildings not facing reality can start with 20 Henry.

Same goes for the beautiful renovation across from Holy Trinity Church on Montague.

I agree that is high... $1k can't last in BH... but I think BH is going to have a lot easier time asking for the high amounts than Flatbush will...

You're talking about the neighborhood that, with dumbo, should easily stay at the top of the brooklyn heap. Also, there isn't a lot of new construction in BH.

Nah, I did not check 20 Henry. I saw the building, it's total crap right now. I think the problem with them is that they bought the building for about $20 million and how many units do they have? Probably around 30+? Word on the street is they are non-negotiable. Uhm, whatever. Where is the nearest subway there anyway? They're like on the edge of Brooklyn Heights.

Montague has 24 units, pretty slow going there too with their construction...and not much action either since they started selling on September.

I think their competition is not Brooklyn (besides On Prospect Park), but Manhattan. I do not think they will be able to justify their prices esp that Manhattan already shows weakening and already off 20%.

20 henry must be a joke. the asking prices are crack smoked.

> Uhm, whatever. Where is the nearest subway there anyway? They're like on the edge of Brooklyn
> Heights.

AC is 2 blocks over, 2/3 4 blocks up Henry.

But I do agree they are overpriced.

I live 5 feet from 20 Henry. It is one block, Middaugh to Cranberry to A Train and 1/2 correctly state 3/4 very short blocks with a stop at Cranberries for some java to warm the tummy while you walk. Well on second thought, if walking from new development portion it is 2 blocks Poplar to Cranberry. lol

Junkman -

Are you hearing anything from the sales office about sales or prices?
Just wondering what the anecdotal news is there...

Well, I would love to report robust sales and tremendous price increases in the last few months but we all know that would be a pipe dream. Truth is, there have been minimal sales with prices staying steady as she goes. Minimal may be overstating the actual total but you get the point. Nothing is moving. We all know prices and deals are only going to get better so why purchase now.

Today we hear sales are down but median prices are up:

AP

The seasonally adjusted annual sales pace of 407,000 was down 2.9 percent from October and was the lowest rate since January, 1991.

Economists polled by Reuters had forecast sales would notch a 420,000 rate compared with a downwardly revised 419,000 in October, previously reported as 433,000.

The median sales price rose to $220,400 from $214,600 in October. The median marks the half-way point, with half of all houses sold above that level and half below.

Economists believe the U.S. housing market will not begin to recover until home prices fall far enough to stimulate demand that whittles down the overhang of unsold homes accumulated since real estate weakened sharply last year.

Inventories of new homes for sale fell 7.0 percent to 374,000 in November, bringing the number of homes for sale to the lowest level since February, 2004.

At the current pace of sales, this means it would take 11.5 months to clear stocks of completed but unsold new homes, down from 11.8 months at October's sales pace."

Personally the increase in median sales price throws me a bit but it is what it is. I know the government has screwed up alot recently so maybe their statisticians messed this number up to.

As I have said many times, the Toren is very reluctant, at this time, to lower prices. They have a good product at fair prices, compared to the competition, and probably will be more amiable to negotiate closing costs. There is a lot to work with here when you consider closing cost for a new development is approximately 4.5% of the purchase price.

BFC knows real estate and I'm sure they will alter this strategy if economic conditions warrant it.

If your prognostications come to pass, which is definitely possible, I'm sure they will take the appropriate action. No one wants to sit with empty apartments and carry maintenance costs for half a building. The Oro developers must be losing tons from what they had originally projected. If you look at price drops in the surrounding area, their prices are only now in line with the Toren.

The question is, if they will all have to accept a new reality and all lower prices further. Given the situation the NY financial community is in, this is a distinct possibility.

> Nothing is moving. We all know prices and deals are only going to get better so why purchase now.

Do you think they'll start moving prices down then?

Or do they have some contractual reason or something to prefer no sales to some sales at lower prices?

uncertainty is the problem right now. when people feel more secure that they're not getting canned next week and that prices aren't going off a cliff they'll come in again.

consider this - govt (obama admin especially) is doing everything they can over the next year to buy up mbs. prime scenario borrower had a shot at 4.875% 30 year fixed rate post fed meeting last week. plan on rates revisiting those levels and probably going through them. once some normalcy returns those rates are going to be a nice prop on pricing ... and demand.

"uncertainty is the problem right now. when people feel more secure that they're not getting canned next week and that prices aren't going off a cliff they'll come in again. "

I don't disagree if prices are low enough.

That being said, when do you think this will be? Estimated on another thread have this not happening before 2010...

no one knows. that's why it's uncertainty. you won't that it's happened until it's already happened.

one indicator to look for is loss of interest in the financial mkts from mainstream media and cnbc going back to bs programming after 8:00 on weeknights.

What's funny is how much more certainty there was on the way up... everyone so sure they'd be making a killing...

Not really. The uncertainty is more about fear of paying too much or not being able to pay than about not making a profit. By the way, this is the normal emotion in any trough, primary difference this time is that the mass media has made it a prime news story and lots of inexperienced people (i.e., people that never really paid attention to economic cycles before) are obsessing. To be honest, the late 1980s - early 1990s period felt a lot more bleak from the NYC perspective. But who knows whether the worst is behind us yet. It will be interesting to see how many of the NYC job losses result in must-sells of high priced units - that could be the straw.

75% decline in sales.... I think you're just missing how much fear is out there.

> To be honest, the late 1980s - early 1990s period felt a lot more bleak from the NYC perspective.

Agreed... but we're only a few months into the fear, we're just getting decline numbers. We've got ways to go...

junkman: I read your post from wayyyy back about your rent stablilized one bedroom in bk heights for $800/month. Since you'll be moving to the Toren, does this mean your apartment will be available for rent?! If so, I'm definitely interested if you haven't found a new tenant. Thanks!

The line is around the bloc. .lol If I complete the purchase, the landlord is moving in family. One thing I forgot to mention, I put around 40K of my own money over the years rebuilding the apartment. (floors, fireplace, built in cabinets etc.)

hopefully you will get some of that back...

sweet baby jeezus - 40k into a rental? have you lived there for 50 years?

BrooklynLove,

I'm getting there. My wife and I have been here since 1980. It's a great location and the apartment has tons of great features, 11-15 foot ceilings, old brick walls, skylight in living room along with a fire place as well as nice shapes to the rooms. Also it is on the top floor which we love. I can't imagine having someone walking over me. The walls are thick so I never hear my neighbors and the view from my bedroom window overlooks a courtyard and trees with a view of the city . It is really nice.

The 40 thousand was a bargain. We built great closets throughout the apartment from floor to ceiling, updated the kitchen, new floors throughout apartment, modern expensive track lighting from Lighting by Gregory (Jack System), rebuilt fireplace, built storage area and many other things. We got our money's worth already.

If I saved it, it would be worth half as much since my portfolio is down 50%. Money well spent. If the market doesn't turn around, we will live here another 10 years, at minimum unless I can build a elevator. Only kidding.

Wow, Junkman, you must be much older than I thought.... I assumed you were in your 20s...

That being said, why on earth did you want to move?

An elevator. My old legs are getting tired waking up 3 flights. lol . The pool, library, health club, sauna and outdoor landscaped area didn't hurt the Toren case. I was ready for amenities. My wife and I were savers and had the money so we thought why not? Unfortunately, we didn't anticipate losing 35-40% of it in the market crash.

Plus, though you disagree, I looked at the prospective neighborhood and saw it as a great investment. Went to Toren on Monday and the curtain wall really looks great. Surprisingly, there are still buildings going up in the area, for example, Avalon Bay, Sheradon Hotel, Loft, 111 Lawrence, 80 DeKalb, Lazeran's project on Tillary etc.

Win some, lose some. Don't know whether your shock at my age is good or bad. I'm afraid to ask. I'm 56. Ouch.

Thanks for the update.

BTW... how are you connecting "great investment" in the neighborhood to a glut of apartments going up?

I think of it like 4th avenue... that neighborhood is DEFINITELY getting better quickly... but as investments go, prices are dropping like a rock because there is just too much supply.

i was down 50% in 2008 but up 1000% over the previous 20 years so i can live with it.

junkman - you'll be looking back with joy when you're 70..

> i was down 50% in 2008 but up 1000% over the previous 20 years so i can live with it.

Lets even say your 10x claimed return is accurate.

500% up over 21 years is a return of about 8%. Even if prices stay flat for the next few years (say 3), that goes under 7%... a 20% decline this year gets you to 5 and change percent...

If you had the same RE as the rest of the world, thats a really lousy return...

... and it paid for college, graduate school and 2 condos along the way ... i didn't say that i never took profits.

Yes, good things can happen as you ride a bubble up... as long as you GET OUT before the crash..

So, btw, what exactly was this investment that went up over 1000%?

The RE market didn't do that...

bernie madoff. just kidding.

lots of exxon and ibm over the years and constantly writing calls on those entire positions, and fortunately timed positions in china and india-centric funds starting around 2002. i sold all the stock in the first half of 2007 and some of the funds in order to buy a place and then got creamed on the remaining china and india investments since then. also steady dollar cost averaging in an s&p fund for about a 10 year period ending in mid-2007, some of which i sold and the rest of which now sucks. writing the covered calls every 2 months adds up quickly over the years, especially when you're reinvesting during a bull run.

So, you sold all your stocks because you could time the market, but totally missed the real estate crash?

no, the stock mkt timing was more luck than skill - sold in order to buy a new place for the long run. in hindsight it would've been smarter to hold onto the exxon and get out of the asia funds.

anyway, the place i bought was priced fairly based on fundamentals (not speculation and cheap money) and it's held up well since - i'm actually up almost 10% based on recent resales over the past few months in the same building. i also sold another place back then to raise cash for my current place - that one was up over 100% in about 4 years.

> i'm actually up almost 10% based on recent resales over the past few months in the same building.

But still holding on? What are you waiting for?

BTW, an 8.3% return while actively trading... you probably would have been better off with a balanced fund and a minimum wage job...

i'm holding on b/c i need to live under a roof. i'm certainly not an active trader, and your 8% number assumes full investment at day 1 with nothing coming out for 20 years. an investment account that has helped me pay for 2 degrees, 2 homes, a wedding, and 3 recessions later is still many multiples from where it started is good enough for me. i guess i'm just a simple man.

> i'm holding on b/c i need to live under a roof.

renting would have taken care of that....

it would cost me almost 3 times as much per month to rent an equivalent place, and that's before tax effects.

And before capital loss effects.

Saving a few thousand in rent doesn't make up for losing hundreds of thousands in equity...

in theory

Has anyone heard anything about when closings would start for Toren? I heard that the developers got their TCO some weeks ago.

I went to MetroTech yesterday and the ground floor is still bare and is still boarded up and the sidewalk shed is still in place. Its not going to be in livable conditions for at least 4 months.

Thanks.

They got TCO in August, closing letters going out this week, meaning 1st group of residents will move in by October.

October 2009? Will they be given complimentary Armani Exchange hard hats and Kenneth Cole construction boot?

Does anyone know the percentage of units sold at Toren thus far?

65% sold and for immediate occupancy... people are living in the building... they have a list of approved lenders as well, I understand Wells Fargo is on the list. I noticed the units come with a washer and dryer from my visit, perfect...

I know you think you're helping, but your marketing attempts are so inept you actually are making the brokers look bad (worse?). I know the press release said 65% sold, but we all can see 94 units out 240 have closed so far, so if you got 13 new victims, that would put your total at 107, almost 45%.
Give it a rest. The wide-eyed innocents who are buying the units at $800-$900 psf nowadays are NOT coming from Streeteasy. You are wasting your time here.