You thought the news couldn't get any worse for the city's high-end condo market – after passage of a mansion tax, new talk of a pied-a-terre tax, new rules that make a shell out of shell companies, and the shrinking of state and local tax deductions? Think again. In a remarkable sign of just how far the city's luxury real estate market has tumbled, a 58th-floor apartment at One57, the Billionaires' Row luxury tower, has just sold after a fire-sale, 50% price chop, Bloomberg reports.
The 4,483-square-foot apartment, which sold for $34 million at the peak of the boom in 2014, has been dumped for $16.75 million, according to city records made public this week. It's the single biggest resale loss at the tower that became a very tall and very shiny emblem of the post-recession luxury real estate frenzy that swept Manhattan. But it's not the building's only eye-popping markdown. Last year alone, as the coronavirus pandemic descended on New York City, four other owners sold their apartments for losses greater than 40%.
“It’s a pricing reset for this building,” says Jonathan Miller, president of the appraisal firm Miller Samuel. “It shows that the market is continuing to adjust for these properties, and it suggests that there’s potential for more.”
One57, constructed during the global recession, came to market just as the world’s wealthy were regaining their appetite for high-end real estate. With virtually no competition at the time – and with no restraints on all-cash purchases by foreign buyers looking to park their money offshore anonymously through shell companies – Extell Development’s project reached $1 billion in sales within six months and recorded the city’s first residential deal at more than $100 million. Its success inspired many competitors – and ultimately led to a glut of luxury condos that is weighing down prices across the city today.
Gary Barnett, chairman and founder of Extell, gamely tried to put a positive spin on the latest fire sale: “Clearly, over six years ago, the buyer understood the value of this unit. Unfortunately, this was an estate sale, and they decided to just dump it.”
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