Elizabeth Ann Stribling-Kivlan
Director of Marketing and Business Development
2012 is emerging as an interesting year in the New York real estate market—particularly in Brooklyn, which is no longer seen as an alternative to Manhattan, but has instead become sought-after in its own right. Brooklyn’s unique neighborhoods, trendy shops and restaurants, and old-world charm are highly valued by locals and, increasingly, by foreign purchasers. Known for its diverse housing stock, Brooklyn offers a variety of single- and multi-family home options, including pre-War co-ops and contemporary new condos with proximity to outstanding parks and waterfront promenades.
Market activity is brisk: open houses in prime areas around the million-dollar price point are experiencing extraordinary attendance and, recently, we saw a record price achieved for a Brooklyn Heights townhouse, giving downtown Manhattan a solid run for its money. Stribling’s newly launched project at 20 Henry Street in Brooklyn Heights is enjoying tremendous traffic. Built in 1885 as a candy factory for Mason Mints and Mason Dots, it has been reconceived by developer Canyon Johnson Urban Realty to offer 38 units in two buildings—one vintage and one newly constructed of glass—with a shared private garden. Sales launched just seven weeks ago and, to date, over a third of the building has entered into contract.
What can explain this demand? First, a relatively low amount of high-end, well-appointed, and well-laid out condominiums in the area created by the lull in new construction over the last couple of years throughout the city. Record low interest rates for anyone with great credit and good post-closing liquidity also contributes to the demand. The persistence of this current trend rests on a variety of factors, including the ongoing strength of the stock market, freeing up of lending at low rates, and ongoing improvement in the United States and European financial and job markets.
This year will be a pivotal one in the real estate arena. For Brooklyn and for the city at large, we can only hope that its strong and stable start will continue.
In August 2011 we asked, “What to think about a world that has come to such extremes?” While the international situation is always fraught with problems, in recent years these problems have seemingly become more broad and more serious in their global ramifications. This continues to be the case, with a few issues subsiding and new ones arriving on the scene, both political and economic.
What is quite remarkable is that the United States economy, which includes Wall Street, seems to be slowly and somewhat steadily recovering, though opinions vary. Since Manhattan luxury residential real estate is normally a lag factor behind our economy, it, too, is recovering at a similarly slow pace.
While one reads about some spectacularly high sale prices, most of these are anomalies. They do, however, signal the return of the money-means-nothing-if-this-is-what-I-want attitude, which was prevalent during the bubble, even if on a different scale. At least three of these recent sales have exceeded $10,000 per square foot, a number never reached during the zenith of the market. The highly publicized $88,000,000-sale at 15 Central Park West for a trophy property by a Russian billionaire is an example of such an anomaly. It is an example of the increasing but overstated trend of oligarchs defining the top of our market, as they have in London. It provides excellent press to said trend, which will probably continue to build as new condominium products come to market in the next two years and New York becomes the “place to be” for the oligarchs of the world.
Domestic buyers returned to the market in significant numbers in 2011 and continue to be increasingly active, especially at the very high end. But unlike the peak of the market when almost any level of quality would sell, buyers have become extremely sensitive to condition, overall quality, and value. Properties either sell “fast and high” or “slow and low.” While it is not easy to pick the point of inflection on a bell curve chart that is gyrating, the luxury real estate market feels like it has regained its momentum and enthusiasm.
From the April 2012 issue of Quest magazine.