Broker Alon Chadad’s client purchased a $14.3 million apartment on Manhattan’s Central Park South, then spent nine months seeking approval for plans to overhaul it. In January, the buyer changed course, listing the unit for sale at more than double what he paid just a year ago.
“He filed all the documents for renovation and he was ready to go and he decided, ‘You know what? I see opportunity in the market,’” said Chadad, co-founder of Blu Realty Group and the agent for the 6,160-square-foot (572-square-meter) condominium, which has an asking price of $29.5 million.
Luxury-apartment owners in New York are listing a record amount of properties for sale, testing the upper limits of what buyers are willing to pay even as median prices remain off their peak set almost six years ago. Sellers have taken notice of a handful of record-shattering deals, triggered by an $88 million purchase at 15 Central Park West, and demand for trophy homes by international investors seeking havens for their cash.
There were 145 Manhattan residences listed for more than $20 million last year, the most in records dating to 2005, according to data from StreetEasy.com, a real estate website owned by Zillow Inc. The average asking price per square foot of those homes was $4,977, 18 percent more than the year before and also the highest on record. Two resellers are asking at least $100 million for their properties.
Below Peak
Such sky-high valuations may not fully reflect the market. While the number of apartment sales for more than $10 million -- about the top 1 percent -- more than doubled last year, the median price of those transactions was $13 million, or 7.9 percent less than such properties sold for in 2008, the year Manhattan residential prices peaked, data from appraiser Miller Samuel Inc. show.
“There’s definitely an argument to be made that some apartments are asking prices that make absolutely no sense whatsoever,” said Leonard Steinberg, a luxury broker with Douglas Elliman Real Estate in New York. “Everybody wants $100 million for their apartment these days. The good news is that $100 million is, what -- 60 million pounds? Only 73 million Euros? So on world standards, it’s still a pretty good buy.”
The $88 million sale, by former Citigroup Inc. Chairman Sanford Weill two years ago, was the “starting gun” for the current frenzy, according to Jonathan Miller, president of Miller Samuel. The 6,744-square-foot, four-bedroom condo -- featuring a wraparound terrace, two wood-burning fireplaces and a library -- was purchased for the daughter of Russian billionaire Dmitry Rybolovlev. The transaction is still Manhattan’s most expensive residential deal and it’s become a symbol of what wealthy buyers are willing to spend for a unique property, Miller said.
One57 Contracts
Since then, two contracts have been signed at more than $90 million each for condos at Extell Development Co.’s newly built One57 tower in Midtown. Bill Ackman, founder of New York hedge- fund firm Pershing Square Capital Management LP, is part of an investor group that agreed to purchase one of the apartments, a duplex spanning the 75th and 76th floors of the 90-story skyscraper.