It used to be that a white-glove co-op apartment on the Upper East Side was the gold standard of residential real estate in New York City. The times they are a-changin’.
“The Upper East Side doesn’t have the resonance that it once had,” Frederick Warburg Peters, CEO of Warburg Realty, tells the Real Deal. “They’re competing against a lot more in every way.”
The competition comes from numerous quarters: from other neighborhoods, including Tribeca and Brooklyn; from new condo projects with eye-popping amenities (and without demanding co-op boards); and from today’s environment of declining prices. On the Upper East Side, Peters says, there’s a shrinking constituency of buyers interested in those once-coveted co-ops, coupled with a glut of supply. The numbers bear him out. In the fourth quarter of 2018, sales listings in Manhattan swelled 12 percent, according to Douglas Elliman, with co-op listings climbing 24 percent. On the Upper East Side, co-ops currently on the market outnumber condos two to one, according to data compiled by real estate analytics platform Compit.
“We’re seeing much more inventory than there are serious buyers out there,” says Joshua Wesoky, an agent at Compass. “There’s a natural turnover with the age of these buildings and a generation of people moving on.”
Adds Louisa Gillen of the Simple Real Estate Company, “There are these grand apartments on Park Avenue that previously would have been commanding high prices. Now, even at a nice discount, they’re still sitting.”
When trying to understand this shift in taste, don’t forget the elephant in the room: the all-powerful board of directors that holds the key to every co-op’s front door. “One thing condos have done, is that they’ve made many buyers a lot more skeptical about whether they need to go through the agita of the co-op process,” Peters says. “For many years, there wasn’t really an alternative, so you still had to deal with that. Now there are choices.”
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