Powerhouse Condo Not Selling Well!! Financial Difficulties Arise

Where are the Powerhouse condos?

lic

maybe that's why I can't pull up the powerhouse page?

What happens when a condo goes bankrupt? I know the people who bought would be out of luck but does the building get sold like a forclosure?

that would be pretty bad for the condo market.

When will a devlelopment below 95th street in Manhattan go bankrupt? That will be when you know the poop has hit the fan.

ummmm, where is this rumor coming from?
First of all, yes, you can pull up the page: http://www.thepowerhouselic.com/
second of all, the developer may file bankruptcy ... but that does not mean that the building is going bankrupt ... if anything, it means that the company will go under but they will certainly try and recoup their costs -- so closing on the existing sold apartment will benefit them more than foreclosing the building.

I would like to see the proof, however NOTHING would surprise me. Since I have always been bearish on LIC, I'll refrain from pouring fuel on the fire, and wait for the facts.

I mean really people GM, Ford and Chrysler can't borrow money from a bank. Read between the lines. They are basically asking for a bailout. Can you imagine. Well the FED created this monster. The problem is, there are way to many monsters under the bed. It's all part of the process, what has happened so far has just been a taste. Wait for the main course.

If the condo files for bankruptcy, people who have closed won't lose anything, but they could be forced to bear the maintenance for the entire building. People with existing contracts can lose the contracts; if their deposits aren't in escrow they can lose them. They can even be forced to pay more for their units if they still want them.

I went through it in South Beach. Google "Bentley Bay" and take a look. It was HELL.

dco - in a paragraph, what do you think the main course is going to be? You mean that not only re: R/E, right? thx

They probably have a surety bond and the bank will finish the job.

lowery- Correct. The markets are no where near their bottoms. It's all a head fake. I contribute this to many factors. I have made my feeling very clear on many topics.

The one thing I will repeat, as far as the markets, is this. Bear markets tend to range between 23-30% declines off the highs. This has been normal % downturns throughout history (give or take a %). We have seen about a 23% decline to the lows of about 10700. It just about has hit the historical range. However, never in the history of this economy, have we faced such obstacles. Every economic indicator has been at historical lows and getting worse. The bull assumption is, the worst is behind us, and we have bottomed at a 23% decline. Perhaps their right and I'm wrong. The indicators have all but shown us that we are far from a bottom. I prefer to look at what the market is telling me, then to listen to some "financial guru", trying to save his own behind.

The money faucet has been turned off and until it is re-opened, we will continue to fall. A 30% decline would put us about 9,400 on the DOW. It is much more likely that we will see 9400 before we see the DOW back at 14,000. If this were a normal correction and bear market I would be buying stocks now, however this is anything but normal. My best educated guess, would put us about a 35% decline. I would be dollar cost averaging starting at about the 25% range and be totally committed to long positions at 30%. This is all with the assumption, that my analysis, wasn't to conservative.

I also feel, that everyone should make note, of how many CEO's and Gov't official have lied since the beginning. Do you think that you are hearing the truth now?

dco, The year is 2003: more mortgages are taken out than at any time in the history of the world. A lot of it was 5 year paper. I/O. Alt-A. Or just way too much money. Too much money for the guy making $50K and too much money for the couple making $275K. Everybody was given too much money. Many, many mortgage holders are currently in denial about what happens after the reset; their ability to hold onto their property or sell it at a profit or rent it to cover expenses. We have yet to see the effect of large numbers of people being unable to handle their loan commitments.

These 2003-2004 resets will happen at the worst possible time: the highest inventory numbers in years and the worst economy in years. Look for some major scapegoating to start in early 2009. I wouldn't be surprised if the Real Estate/Mortgage industry gets the "Penny Stock Broker" treatment...

stevejhx
about 13 hours ago
ignore this person
report abuse If the condo files for bankruptcy, people who have closed won't lose anything, but they could be forced to bear the maintenance for the entire building.

entirely untrue.

If a lender takes over the properties from the developer, the lender will be responsible.

The only way the condo owners would be responsible is if the unsold condos became the responsibility (and the property) of the condo, in which case the benefits of the sale of the unsold condo units would first go to the condo.

ok, dco, I understand what you're saying - I'd like to believe that the bad economic news, tho, is so surrounding us that this is as bad as it will get, not that it will get worse - the employment picture is scarey - when people's incomes decrease because they are entrepreneurs or contractors, Labor Dept "unemployment" stats don't reflect them - I'm hearing anecdotally that across the board people are suffering here in NYC at all levels, or at least spending less $ - I can't argue in depth, but I do think that the buzzwords about the credit crisis being completely unprecedent or the worst since the Great Depression are over dramatizing things - I have always wondered how much of the recent new-condo buying has been highly leveraged with ARMs staring at resets - I just don't know - I don't think one can assume that the entire NYC market is leveraged and ARMed like the infamous SoCal market, for instance. But it's all possible .... what I was interested in hearing was your "main course" to come - do you mean major corporations having liquidity problems? Small business owners going belly up because can't meet payroll with credit lines? More bank failures?

80sMan- This is why I have said, that this was never just a sub prime problem. Billions were lent to borrowers that wouldn't have been considered sub-prime. They were just lent way to much money. Prime loans are defaulting at the fastest rate ever recorded. I know this is a surprise to some, but check the facts. We are not even in the second inning of this mess.

Although I agree that things are overdramatized, I worry about "the next shoe to drop". A couple possibilities:

1) Credit card defaults skyrocketing. Although I am admittedly not well versed in the facts, I've seen numerous stories reporting that credit card borrowing levels are spiraling out of control. I can imagine a credit card collapse of similar proportions and similar dynamics as the subprime collapse. Totally speculative, just a possibility.

2) Corporate defaults and bankruptcies. Corporations have been leveraged up to unprecented levels. They were counting on robust growth to generate more cash flow to pay down the debt, just like borrowers of too much debt were counting on ever-increasing housing values. They certainly weren't counting on an economic downturn. The terms of the corporate debt were generally very lax, so they haven't really been hit hard yet (except for a few relatively isolated pockets), but it's just a matter of time. This one I am fairly certain about, but the magnitude and the fallout are less clear.

I don't think we're entering the great depression again, but we definitely have some headwinds.

lowery- Liquidity? What liquidity? There is none. Just take GM,Chrysler and Ford. If this were just a normal bear market, do you think that they would be begging the federal government for money. Look at it logically. If this were 2006, do you think one of these companies would be airing their dirty laundry? It would be suicide. Fast forward, today you have the BIG 3 asking for a loan. A loan, my A$$. What they are asking for is a bailout. They are actually bankrupt. That's right broke, just like Bear Sterns, FAN, Fred and Lehman. If the fed closed the window on Monday, how long would it take for a major IB to go under. My guess would be by the end of the week. By the end of September it would claim 1 or 2 more.

Let me say it as simply as possible. If you are a business, and need money, forget about getting it from a bank. We are in a global financial crisis. No one knows just how bad it will be. The truth is, that everyday that home prices fall, so does the paper attached. The write downs will continue.

Now add in banks with huge exposure to credit cards. Look, if you owned a home and were short at the end of the month, where would you go to cover the mortgage. Credit cards all around the world were used to pay monthly expenses including the mortgage. I will bet, everything I own, that prior to a person losing their home, they ran up the credit cards for thousands. Just look at Visa and Mastercards earnings. They are not banks, they make their money on transactions fees. They saw about a 19% increase in earnings. Once you drill down, you find out that the bulk of the increase, was the result of consumers charging essentials, not wants, but needs. It's all going to have to be written off. Your talking Billions. Now lets talk car loans. Do you think that these people are going pay their car payments. Billions more. I could go on for days about this mess.

dco, I agree with you about credit cards (I think we posted about the same time), but you're off on the Big 3 (and I know a fair amount the auto industry from work). They are indeed in deep trouble, but it's because of their completely broken business models. The credit crunch, expensive gas and economic downturn are accelerating their freefall, but not causing it. In other words, you can't say they're indicative of the broader economy or corporate health.

I know for a fact that companies are still functioning, still getting loans, still doing deals, etc. A whole lot less than in the go-go days of 2005-2007, but economic/financial activity hasn't stopped. Nor will it. That's why I don't think we're going into the great depression again.

newbuyer99- I never said we are going into the great depression. I do agree, that it's just not the credit crisis that is causing the Big 3 problems, however they are in much worse shape then anyone actually knows.

I'm not saying that all companies are not functioning. Clearly the world still functions on a daily basis. HAHA. My point is that it's really hard to get a loan and getting harder by the day.

klint, you're entirely wrong. The bank will file for foreclosure, causing the developer to file for bankruptcy protection. Once the bankruptcy is declared, the bank will be unable to "take over the development"; it doesn't work the same way for commercial bankruptcies as it does for residential real estate.

The first step in the bankruptcy are notified and classified. If it is a debtor-in-possession workout - which most are - then the bankrupt has 90 days to prepare and gain acceptance of a workout plan. That is routinely extended by the court if there is progress in the discussions. What the final terms of the payout to creditors - and whether the debtor remains in possession - is up to the court and the US Trustee.

You're out of your league on this one - I went through this hellish process for 18 months. If you've not been through it, you should do before making a post. Owners with contracts can see their prices increased if that's what the court wants, they can lose any portion of their deposits not in escrow, their contracts can be canceled entirely.

Please do your research first. Banks just can't "seize" a commercial property - they are granted protection under chapter 7 and chapter 13 of the bankruptcy code.

dco, it's a recent shift for me but I have become somewhat more positive on certain sectors of the equity market (ex financial, all real-estate sectors).

A few shifts that are taking place:

1) US Dollar turning- The last hyper-overvalued commodity class that had been holding up has turned, mainly the Euro & other foreign currencies. Sterling is in a free fall and the Euro after taking a beating from 160 to 146 cannot manage a bounce (at all). My take is that the USD will continue its upward trajectory which may inspires US confidence but more importantly, it is taking raw commodities down & down hard.

2 Deflating commodities-) Lower commodity costs will be a boost its major users from the Big 3 to Procter & Gamble & specially the American consumer. I suspect 3Q earnings from major US corporations will begin to demonstrate the benefit from the recent plunge in raw costs.

3) Senator McCain is gaining in the polls-IMO, a biggie as it eases a major cloud of uncertainty hanging over the financial markets mainly, tax policy, energy policy, confidence, massive new spending initiatives, expanding federal budget deficits & so forth. IMO, this development is in no small way responsible for the boost in the value of USD.

4) Real Estate-Nope! There is a massive world wide deleveraging process underway both at the consumer & private levels which will take years to resolve. Bubble burts are extremely dangerous when they occur & the ensuing bear markets usually last longer and is much deeper than anyone believes. We have a ways to go here and ditto for the related financial sector or any company that relies on leverage for its profits. Outside of the US, one only has to examine the well documented serious problems facing the London, UK RE market to see the trends in a blown out of proportion residential/commercial market.

Interesting times we live in.

I thought that this thread was about a bad rumor that the powerhouse was goign under.
Way off topic.

Definitely interesting, stevejhx you know a lot about real estate but you've had a bankruptcy

lobo - fair point, we should've taken our macro views to a different thread.

lobo "I thought that this thread was about a bad rumor that the powerhouse was going under.
Way off topic"

You are 100% correct. I actually forgot until you pointed it out. Sorry, but it's easy these days, to get side tracked, with the economy and it's affects on the NYC RE market. Nonetheless, you're right and I'm sorry and I will stop now.

Lets get back to the real question of the topic. Is this FACT or FICTION. I ask anyone, with evidence, to please post. I'm sure there are a lot of nervous people.

tlai?

Any more info. Is this true or just BS. Any insight?

"If the condo files for bankruptcy, people who have closed won't lose anything, but they could be forced to bear the maintenance for the entire building."
stevejhx - thanks for the color. i'm a little unclear on your explanation of why existing condo owners could be responsible for the entire maintenance. is the allocation of bldg maintenance a judgment made by the court handling the bankrupcy or is that a standard practice or rule of thumb? or is it the result of lenders (as they seek possession of the unsold units) negotiating against parties that have claims (i.e., existing condo owners) on shared expenses? was your situation in FL governed by state or federal law - maybe there could be some difference between FL and NY residential bankrupcy code?

any new news?

Can LICComment add anything here? [SFX: frenzied shrieking, guffawing, high-fiving by studio audience]

Well, it sure didn't help that the main sales person there was a really snooty. She was even rude to my broker who brought me there. And my broker is a highly sucessful broker and she got snubbed by this sales person. If only I could recall her name. Even though I liked the place, the sales person was so snotty that i was completley turned off to the place. And this was in early Jan --in other words, when the market had already cooled off.

I don't know anything about a possible bankruptcy. I know that closings have happened and there are people living there now, but it seems like a majority of apartments are still unsold.
I was never a big fan of this development. Some of it is good - the location, the style of the interiors, amenities - but in my opinion they put too many apartments into the building, so lots of the layouts are odd, especially for the prices they were asking.

Jerkstore - as if on cue!!

Are any of the condo's there going bk and have to liquidate? I wouldn't mind moving to LIC but it's hard to justify paying the same amount for an apartment there as Brooklyn. The neighborhood or community really doesn't compare to brooklyn's and it's pretty much just new condos. The 7 train is also always a disaster and walking to the E brings me closer to the projects than I want to be. To me, LIC is in the boroughs but feels more like Jersey.

powerhouse if moving full speed ahead. I passed by this week, and saw the gym, and spa almost ready.

I believe they lowered the prices, so when i was there i saw a ton of people touring.

The 7 train is one of the most reliable in the whole subway system. imsobroke is way off on that one. Also, the E train is nowhere near any projects.

what is the pricing on the units? didn't see it on website.

about 6-7 hundred per sq ft depending on the view of the unit

I am new to this board and realized that all liccomment does is attack people. It's safe to say either he/she's a broker or just a nasty person in general.
In the mornings, the 7 train is so packed by the time I get to queensborough plaza that I always see people left waiting for the next train. Not something I would look forward to. Also, weekend service to manhattan is frequently cut off. The 7 train is NOT the most reliable either. I would highly doubt there is any proof of that. Just broker lies. Also, ever hear of Queensbridge projects? Probably nowhere near Queensborough bridge though. That would make too much sense.

Anyway, back to my original question. How are the developers of all the new condos doing? Will there be any panic or can they just wait out the market until prices come back?

Here are some links for LICComment. I will no longer respond to LICComment. All I see is him attacking anyone with anything negative to say about LIC with nothing backing his statements. Like I said, I wouldn't mind living there, just wondering if prices could drop in the near future.

http://www.nytimes.com/2009/01/24/nyregion/24metjournal.html?_r=1&ref=nyregion
http://blogs.villagevoice.com/runninscared/archives/2009/01/gioia_lic_resid.php

Correcting wrong statements is not an attack. I take the 7 everyday during rush hour, it always runs frequently, and except in rare occasions, I never have problems getting on the train due to crowds.
Weekend service on the 7 may be cut off during January-March, but the rest of the year it runs all the time and is very reliable. The MTA has to run it reliably on weekends during baseball season for the Mets and during the holidays for everyone to be able to get to midtown.
The E train at 23rd and Ely is under the Citi building. Nowhere near the projects.

I have to second LICComment on the 7 train situation: I've been taking the train during rush hours from vernon/ jackson station, it was always a smooth ride (especially comparing to the crowded 4/5 which I have to transfer to at Grand Central). Never had a problem getting on the train -- I typically leave for work between 7 and 8am.

On the weekends it's a bit of pain waiting for the shuttle buses though. (From Jan to Mar, that is).

So you guys do realize that the remianing units have gone rental, and very few have in fact rented...right?

> I typically leave for work between 7 and 8am.

I wouldn't quite call that rush hour... especially for an area with a younger set of folks and not too many traders.

WB and other parts of Brooklyn, I've usually seen it peak an hour to 1.5 hours later... so lets say 8:30-9:15 in the middle.

Jason

WRONG

CHECK YOUR FACTS

"Jason

WRONG

CHECK YOUR FACTS"

Oh, better yet. See, there is this site called Streetesy.com. Check out the units for rent:

Rentals listings for this building
SAVE RSS Active Listings (27)
$4,500
50-09 2nd Street 3 beds 1,500 ft²
$4,500
50-09 2nd Street 2 beds 4,500 ft²
$4,000
50-09 2nd Street 2 beds 1,357 ft²
$4,000
50-09 2nd Street 2 beds 1,201 ft²
$3,950
50-09 2nd Street 2 beds 1,263 ft²
$3,714
50-09 2nd Street 2 beds 1,357 ft²
$3,670
50-09 2nd Street 2 beds 1,187 ft²
$3,521
50-09 2nd Street 2 beds 1,333 ft²
$3,500
50-09 2nd Street 1 bed 1,173 ft²
$3,450
50-09 2nd Street 2 beds 1,173 ft²
$3,400
50-09 2nd Street 2 beds 1,232 ft²
$3,342
50-09 2nd Street 3 beds 1,173 ft²
$3,200
50-09 2nd Street 2 beds 1,013 ft²
$3,017
50-09 2nd Street 1 bed 1,006 ft²
↓ $2,995
50-09 2nd Street 2 beds
$2,971
50-09 2nd Street 1 bed 880 ft²
$2,878
50-09 2nd Street 2 beds 1,001 ft²
↑ $2,750
50-09 2nd Street 2 beds 947 ft²
$2,650
50-09 2nd Street 1 bed 859 ft²
$2,600
50-09 2nd Street 1 bed 888 ft²
↓ $2,600
50-09 2nd Street 1 bed 830 ft²
$2,350
50-09 2nd Street 1 bed 759 ft²
$2,350
50-09 2nd Street 1 bed 759 ft²
$2,300
50-09 2nd Street 757 ft²
$2,050
50-09 2nd Street 1 bed 608 ft²
$1,950
50-09 2nd Street 608 ft²
↑ $1,900
50-09 2nd Street 613 ft²

http://www.streeteasy.com/nyc/building/50_09-2nd-street-long_island_city

Most of these units are not listed by the developer. 2 (10 unit) blocks were sold to investors and turned into rentals.

HWY, in terms of what that means to purchasers, not much difference. And the patterns seem weird. Is there any chance that the developer set up subs to buy those blocks of units?

Only 30 units closed in the building. 27 is available for rent!! Sure looks like a rental building. Who cares who owns the units. The Powerhouse will soon be filled with renters paying only a fraction of owner/resident.

Very likely are subs by the developer or his affiliates. If this assumption is true, from a purchaser perspective, it is an additional assurance that the developer is willing to weather the current condition, much less likely to default on the construction loan. He would have too much vested interest in this building.

From a pricing perspective, yes, much better pricing than 6 month ago. Samething can be said about every property in NY.

I'm not sure I agree with your conclusion.

The developer is essentially putting more equity into this investment.I don't know the price level these block units were moved, however, pricing on any units would be subject to the pricing guideline (floor) established by the bank. This is a good sign from an investor's point of view.

I moved in a month ago, really like the building and my unit. Yes, I would be much happier if I could get my place at 10%-15% discount.

First it was an outside investor, now it's the developer putting equity into the building and renting them out, which is it?

When fannie's new rule requiring 70% of the building to be owner occupied goes into effect, you'll see another leg down in prices for the Powerhouse. There is a reason why fannie enacted the rule... to protect against a rapid drop in condo value which can trigger delinquencies and foreclosures. The current asking price from the developer is down more than 20%. That means anyone who closed so far can only get out with a short sale. When that happens, you'll see appraisal prices for the entire building drop like a stone.

It doesn't really matter who is renting out the units. With only 40% of the building sold and potential for short sales around the corner, it sucks to be an equity holder in such a building. I'm glad you like the building because you'll be stuck there for a long time. I just hope all your neighbors will stick around too, or it'll get ugly very quickly.

SugarStar, you come accross as a bitter person, take a min. and ask yourself why. About your comment, nothing people on this board don't know of. P.S. do you enjoy watching jerry Springer, your type of show. Take care.

HWY, you can resort to personal attacks all you like... unfortunately it still won't change the fact that with more than 100 units unsold and more than 30 potential short sales in the making, the Powerhouse is likely one of the worst buildings to buy into right now.

"So you guys do realize that the remianing units have gone rental, and very few have in fact rented...right?"

-20 units is not the remaining.
-Almost all 20 have rented
-brokers just haven't updated there listings correctly.
-i closed on my place in march, still showing available

ps. Sugar, enjoy you 4th fl walkup in spanish harlem. Cant be a hater all your life

COnsidering the fact the price PSF in East Harlem is about the SAME as LIC for comparable buildings, that does not sting very much, richseda. And I have emailed about several rentals in Powerhouse, and all were still showing. So we may be neighbors, and I will surely come ask to borrow a cup of bitters from you.

Guys, these is no doubt in anyone's mind that RE market is not a good investment nowadays.For anyone who has any realestate exposure right now, it is likely that it is worth less than a year ago. So let's move on.

RE Investment is more than just an investment for some of us, it is an investment in life (if you intend to live there) I would not lose sleep for 10-15% market adjustment if you enjoy where you live and intend to be there for the long term.

The only viable concern for PH is if the developer will go bankrupt. I don't think it is likely.

Have a good one.

"I would not lose sleep for 10-15% market adjustment"

At 4.5% 30yr fixed mortgage rate, it will take over 5 years of mortgage payments to accumulate 10% equity. Over 8 years to accumulate 15%. 8 Years of your mortgage payments just went into the developer's pocket with you having nothing to show for it. If your mortgage is 20% of your income, you've basically just took a 20% after tax pay cut for the next 8 years. This seems like a pretty big deal.

As for quality of life, your rental neighbors enjoy the same ammendities as you do at a fraction of the cost. The 100 or so unsold unit combined with current owner's mortgage being more than unit value create a lot of uncertainties for this building for a long time. All i am saying is given these uncertainties, there are a lot of risks buying into the Powerhouse beyond the developer going bankrupt that you brought up.

There are a lot of other condos in LIC with much better stable situations. If people want to buy in LIC, it is much better to look at those options first. If people really like the Powerhouse, given the option to rent, they should rent there instead of buying.

SugarStar, you are thinking like a renter. There are lots of other factors involved. Maybe people have owned for years and sold and bought. Maybe the tax benefits of owning are a big factor. Maybe you don't think that the price will be down in 5 years, or maybe rents will rise in 5 years. Maybe you don't think mortgage rates will be this low forever. You are looking at this with blinders on, and you are missing the bigger picture. Real estate values have to be looked at relative to lots of factors. I have owned for years and I am much better off than if I had been a renter this whole time.
Powerhouse has its positives and negatives, like just about any place. Does it have worse negatives than other buildings in the area? I don't know, but other than your speculation of the developer's financial difficulties, which is just your speculation, you haven't really brought up anything substantial. Powerhouse's prices were always above other similar buildings in LIC, even in 2007. I'm not sure why and I'm sure they would have sold a lot more if the pricing wasn't above market before things started declining. But if they recently brought the prices down to the same levels as the other buildings, maybe more of the units will sell. We'll see.

LIComment, my point is for the people who bought into the Powerhouse at last year's prices, they can not sell. As you said, Powerhouse were priced above other similar buildings in LIC, but now they brought the prices down significantly. As a result, many people who bought in last year now have negative equity and can not sell unless its a short sell. This along with all the unsold inventory at the building will create a huge over hang on this building. Other buildings in the area don't have this problem.

And also to set the record straight, I was not the one who brought up the speculation of the developer's financial difficulties. I merely said there are other risks specific to the Powerhouse that needs to be considered.

"Maybe the tax benefits of owning are a big factor."

As always, I point out that these our balanced out by the insurance and maintainence fees. As a point of fact, the asking selling prices STILL suggest a highly out of whack price/rent ratio which ONLY makes sense if you expect double-digit price appreciation every year for over a decade, which no one does.

Wondering do people think that prices are really only off by 10-15%.
How much would developer have to drop prices in order to create a demmand for these units? Seems like a lot more than that to me

Also, I don't know the LIC rental market and the bldg looks very nice, but does anyone think that there are a lot of people out there lookinmg to spend $3-4.5 grand/mo to rent in LIC?

kiz - no

avalon north and eastcoast - both of which are nicer buildings - are offering similarly configured 2 beds at ~3k /month. theyre both running 2mo free promos, which will knock off another 20%.

i highly doubt that "almost all 20 have rented", as richseda claims.

call eastcoast, there cheapest 2br is 3700 (and 2 months free)

a friend of mine personaly rented 7 of the unts, and considering there are other firms renting them as well i think 20 is gone.

uh... no.

all it took was a quick look on the rockrose website to see that the most expensive 2br is 3600. not to mention that both avalon buildings have 2brs that are significantly less.

i hope you meant to say that your friend is marketing 7 units for rent, which means nothing. if he is actually renting then, then he clearly got hosed b/c he's be paying the carry in a market where comparables are priced 20% lower.

i spoke to modern spaces, the local LIC RE firm that is renting the units, and they told me i would have plenty to choose from in the powerhouse if i set up an appointment. they told me there's negotiability in the asking rents. dont believe the liar brokers on this site, you can have a 1 br in the powerhouse for sub-2000

jraz, I think the comment above was a goof from someone strangely trying to impersonate me.

Funny. But anyway from NYBITS:

partments in Long Island City:
$3,300 2-Bedroom at East Coast @ 4720 Center Blvd. Rockrose Development Corporation 16/Apr/2009
$3,325 2-Bedroom at East Coast @ 4720 Center Blvd. Rockrose Development Corporation 16/Apr/2009
$3,339 2-Bedroom at East Coast @ 4720 Center Blvd. Rockrose Development Corporation 16/Apr/2009
$3,398 2-Bedroom at East Coast @ 4720 Center Blvd. Rockrose Development Corporation 09/Apr/2009
$3,630 2-Bedroom at East Coast @ 4720 Center Blvd. Rockrose Development Corporation 16/Apr/2009
$3,675 2-Bedroom at East Coast @ 4720 Center Blvd. Rockrose Development Corporation 16/Apr/2009

I went to the LIC area over the weekend and looked at all the condos for sale. It seems there are about 10 condo buildings that have listing available near the water, not those other ones by the Citibank building.

I found some deals in all the buildings in LIC between the low 600 and upper 500 per Square ft(actual listing price). This is pretty large discount when i visited last year where everything was over $700 a SQ FT and no one was coming down on price. The powerhouse and others seemed to drop some prices this past weekend, and seems like they are becoming more reasonable to purchase with the recent declines. And if they are listing in the high 500's that means they will sell in the low 500's most likely. It seem in the low 500's some of these buildings will sell given the views and the amentities. But i guess we will see in the near future.

The powerhouse happened to be one of the nicest in the area and has a partial view. The only other building with a view is the view. The others are all inland.

with rents apparently down 20-25% from the market's peak, and real estate being perceived as a riskier investment given the tough climate, investors will demand a higher rate of return for investing in RE, which only means prices have to fall some more for it to make sense for people to buy. obviously can't predict where things will bottom, but a cumulative drop of 40-50% from peak prices in an overbuilt and more fringy area such as LIC is not unrealistic

recently rented at The View in LIC. It is a Rockrose building but with much nicer finishes, high ceilings, w/d in apt. paying $2550 per month with free parking. Checked out all the above buildings and this is one is far superior in quality.

cfranch, what is the size of your apartment?

A few other buildings at or near the water have views of Manhattan, of course depending on the floor and location within the building.

725sq ft with direct views of manhattan

how many months free?

no free months offered on condo to rental apts

jason10006

those are new effective rents

Yeah, so?

You realize that Rockrose, avalon, etc, rarely advertise the CHEAPEST units of a particular size when they have multiple vacancies, right? I girentee you that one can be had for 3 flat, with so many condo units on Streeeasy in LIC going for like $2600-3000 right now. (Do a quick search and you will see, dummies.)

Anyone know which bank is the LENDER on the Powerhouse LIC project?

Wellsfargo is the preferred lender as of now. However, they will soon stop lending to buyers in the Powerhouse because new FNM rule requires 70% of the buildings to be owner occupied.

wells fargo and fairmont...wells fargo likely drops out after june if new fannie mae regulations are not satisfied, but can close on previous commitments. basically the only lenders you will get are those who will hold the loans on their books, which means anyone buying there will have very limited options and will probably have to pay higher rates

Are you sure about how the new FNMA rule applies to preferred lenders?

they are grandfathered in for all previous and new contracts up until a specific date. for example, Wells Fargo is clear to loan (only with a 25% or so presale requirement) to anyone that qualifies up until late June. After that, unless they are able to extend this lower presale requirement (which seems unlikely unless the Powerhouse starts selling a lot more units), I believe it is safe to say that Wells Fargo will not entertain commitments to new purchasers. I could be wrong, but this is my understanding. Not sure if it is the same for other developments, I am sure it depends on the type of preferred lender they have (i.e. large national mortgage lender vs. smaller private lender that will hold the loans on balance sheet)

I saw this same scenario play out back in 89-93 and I stole my one bedroom, doorman in door garage in Astoria/LIC for less than 100K with a full terrace and city view in 93. Back then we had the IT boom and the Internet Boom to drive economic productive growth in the economy and we had Wall Street creating massive bubbles thru creative financing in the .com bust and now the real estate bust. This is a phony economy with all manufacturing jobs outsourced overseas and the nbust of the Wall street Ponzi scheme....game over for a long long time!!! Unless we find a growth engine to create jobs....and none are on the horizon!!! Wake up!!!

BTW my 1 bedroom was listed for $240K with garage. I negotiated it down from a reduce price of 130K then told them to throw the indoor garage in and I walked away when they balked!!!

The thing sreally stings about th new rules is that no single entity can own over 10% of the units. So a sponser cannot simply create a related firm and "buy" 30% of the units to rent them out. Which is why, of coourse, we are seeing brokers pushing "bulk" sales of units all over NYC - if several investors rent out units then they can still, hopefully make the over 70%/no more than 1 owning 10% rules.

> SugarStar, you are thinking like a renter.

Take that as a complement!

wow a lot of back and forth in and out of the main subject.

Are the going bankrupt?
I dont think so but they are definitely feeling the pain and going to be a challenge with little sold like 30 units over 177 units. 40 units are for rent so it is def not form a bulk purchase but something really shady. Also keep in mind that the value of a Condo goes down fast when the building goes rental. So the price should go down if only they will accept it they would be selling like crazy. buyers are looking for deals.

Wells Fargo will probably go under the new rule and then the powerhouse in long island city will be left alone with buyers not being able to get finance and rates higher it will be harder. again the developer should realize all that and sale units now at a reasonable price. but again like some other buildings they believe real esate will pick back up soon!? lol if 5-10 years is soon they yes they are right. it is going to be hard.

to Tonymag up there, you def over paid but as you said you bought too early when price were crazy just up for no reason but loans given away for the same no reasons that now we are all paying for. I am still surprise for a guy that knows developers etc.. you did not get a better deal.
banks should go down and we should not help them. developers should go down and we should not help them. why? because we give to the bank our money and they are playing with it and playing with us interest rates is an example. developers are charging crazy prices for no reasons because in nyc they have became greedyyy. people are the demand people should drive the price and we should not be dictate what to do when and how much.

ON the news a good article came up about what would happen if a building goes bankrupt like a condo and it seems that many building now in miami are experiencing this, the wave is to come to NYC at last so LIC will get it for sure. if you buy high and then goes bankrupt you will end up having the biggest monthly payments you never had and you will start defecting on your loan and all back again. same story. when you sign your contract you are responsible as a shareholder not a coop way but condo way so with 100+ not sold units add up all the charges and building monthly expenses and you can see that it will cost a lot to maintain. price will then go down again because of the developer greed.

price in LIC are not the price of Manhattan so whoever posted that it is not right average in Manhattan is 1000 per sf in LIC now 600 per sf. the price will be 500 to 550 soon unless developers are willing to sit inventories for a while, which some will do as they think it is right thing to do. i think it is wrong because it is a snowball effect. get the price out to the right price people will buy. keep showing and asking over 700 or 800 per sf for LIC and you are scaring people away.

the view and the powerhouse both made the same mistake, they priced too high and kept it there now they are sitting on the units with no buyers and they are feeling the pain. yet they dont get it because as we all know when someone is wrong like that they have to keep showing no fear that they are right. so developers stay tuned, buyers have time for the least.

BUYERS dont buy over 550 per sf for now, if you have so much money then pay the 600 per sf but if you pay more than you will not make a good deal. NYC is strong but as every city the price goes down. nyc is well know to be a shark city so that why you will not see the right price on the sticker but ask for it. developer are full of it to not lower prices.

yes if you buy not to resale you should be fine in 5+ years from now not before not before. and if you pay 800+ per sf then good luck even in 5 years.

price have not gone down significantly when you look at the per sf realistic price, what i mean is that you cannot priced a unit of 1400 sf at 1.6mil then 1.3mil and feel it is reduced. 1.6mil was a big scam in case someone with no study on the subject walk in and buy because banks were giving away loans to ninjas:). 1.3mil is over priced still this is queens not manhattan but should have been a start point.

tax abatement is good to have on a condo but all condos have it right now and with so many inventories and few hundreds coming to the area this summer price will be steady or go down a little because summer time is historically more units sale because of the time of the year. but watch after summer it is going to be bad. dont pay over 550 per sf. 3 years ago it was the price in LIC, in great time so now it this really really bad time price shoud go back there if not lower.

good luck buyers and get a bargain

As a Williamsburg resident, I am offended you think the LIC floor should be 550 psf. That's the current going rate here and LIC is nowhere near as nice. Sure, LIC has nicer buildings but that's like saying condos in the FiDi should worth more than condos in the village psf. This makes no sense to me. Come move to crooklyn.

LIC is not as nice, but its MUST more accessible for people who work in Midtown than Wburg is to either FiDi or Midtown.

What do you mean by "nice"? If you mean more bars and stores, then Williamsburg has more. If you mean better waterfront parks, views, buildings, etc., that's a different story. I think you have a very different market of buyers for LIC compared to Williamsburg.
I agree with some of what mike77 says, but I'm not sure what the right price for LIC is right now. As of now I don't think it is as low as he does. Obviously it varies based on building and location. I think Powerhouse was overpriced even before the downturn when sales were good. Despite what the sales people said, they were pricing it as a waterfront building and it just isn't. It may be a good building but they priced it too high. A 20-30% cut in Powerhouse prices doesn't mean all of LIC is down that much, because I think Powerhouse was priced above the LIC market in the first place. I also think there are a decent amount of buyers interested in LIC and ready to buy but they are staying on the sidelines to see if prices come down more.

> If you mean better waterfront parks, views, buildings, etc., that's a different

I might give the edge to WB on that.

LIC still just way too close to industrial for my tastes. Newtown Creek... eew.

"A 20-30% cut in Powerhouse prices doesn't mean all of LIC is down that much, because I think Powerhouse was priced above the LIC market in the first place."

I believe I said months ago that we were going to hear things JUST like this. This is an exception, thats an exception, it was ugly, it was overpriced.

Problem is when everything is an "exception".

Compare between this and this is not the problem
LIC is LIC and it has its good and bad. people loves it better than other places around cause it is one stop on 7 train to the city and thats great. it is still a raw area booming and cought in the credit mess.

the price should be around 550 to my opinion and it should go lower by year end. right now you have people taking money left or right. after summer this should be ober and less spending should be seen. developers should start being realistic and stop pushing away buyers. i have friends that were treated bad really bad by the powerhouse because of attitude from the office and rejected all offers when they gave offers around 600 per sf. now people are buying at 600 per sf there lol thats funny. so they lost few buyers because they dont know how to market and anticipate. they only hope sells on pigeon. you can have money build whatever you want but if you dont get the people dont get the buyers dont understand the economy then you are simply not business savvy and your name is the powerhouse if not the view. rockrose are good at rental but when they tried to do condos here well they have a building so far that has no entity it is rental for now and they hoping by this summer to become condos. i am sure they will do it but at this rate like the power house for each building to be completely sold and fully condo no rental it will take few years.

Oh I am not hating on LIC, I just think some people are delusional. None of the areas its compared to (Harlem, Wburg, Fidi) are exactly the Meatpacking.

FYI my attorney advised me that approx 50 units closed already at the PH, approx 25 more are in contract. he dosnt think this project is heading for bankrupcy, he advised me at this point it does not matter regardless. approx 25 unit are for rent, the rest will be sold,

50 closed, 25 in contract. Out of 177 available, that's still 101 unsold. Everything will sell if priced low enough. With that much unsold, prices will go lower.

btw, you may also want to check how many of the 25 "in contract" are in dispute and will never close.

who controls the 25 rental units? if they are "sold" to an outside investor, shouldnt that count as closed in acris? is the 25 rental units included in the 50 closed?