The Madison Avenue Condo That Wasn't
Tuesday, March 20, 2007, by Joey
Did you know that the pre-war office building at 60 Madison Avenue was slated to go condo? Even though no official announcement was made by building owner the Moinian Group, the tenants of the 200,000-square-foot building between 26th and 27th Streets knew that their time was almost up, and luxury living was on the way. Holy crap, that's huge news! Or it would have been, if Joseph Moinian didn't decide to drop the conversion plans because of concerns over the Manhattan condo situation.
The Post's Steve Cuozzo has the scoop on 60 Madison, which is adding a new tenant—Weight Watchers—at a rent around $45/foot. Moinian Group VP Daniel Gohari pointed to other condo developments in the Madison Square area, but added "within the next four-to five months, we're going to see a big correction." Commence terror. Cuozzo also mentions other recent changes of heart, including Harry Macklowe's office tower at 510 Madison (originally slated to be a condo/hotel) and the sale of the International Toy Center (instead of a residential conversion). One he left out: the de-Somed 485 Fifth Avenue, which Curbed readers know is being Hyattized like a mofo.
· Migrating Moola [NYP/Cuozzo]
[60 Madison photo courtesy of Property Shark]
Correction? But... it's "different" this time. New York is a "different" market.
LOL on the weight watchers. Talk about scraping the bottom of the barrel. Maybe they should add a PayLess Shoes there too!
Fabco has just signed a lease for most of the ground floor retail.
probably has more to do with the incredible strenth of the commercial market than anything else.
Grandpa: So sad to see the housing heads in denial. It's different in NYC. What happens there doesn't happen here. Blah blah blah. Have you noticed the meltdown on Wall Street? The meltdown in the mortgage sector? Guess what? It's just getting started! Stricter lending standards are shutting out 20% of the potential buyer pool. Stricter lending standards are shutting down the ATM at the Bank of Mommy and Daddy. Adjustable rate mortgages are re-setting and desperate suckers, er, homeowners with negative equity who are unable to refinance are trying to find greater fools to unload their overpriced shitty McCondos in Brooklyn upon.
It's ovah, NYC!!!
Welcome to Corcoran's triple-mint Masque of the Red Death. Party on! But who let in that strange-looking guy over there? Can't be a disgruntled buyer with an 800K 1-bed whose teaser rate is adjusting ...
when you're in denial, you're always the last to know about it.
I am not saying there is not a bubble, there is. But it does not seem like it will pop in NYC. Every local market is different. The sales slowdown that is being seen nationally will probably reach NYC as all the bonus folks close on their apartments. Sales may slow, prices may not increase, but not likely drop significantly. Too much unmet demand, and very little inventory.
OK, so now I am concerned. My parents bought my place for me when I moved here, and they expect to make a mint. If they start to open Applebees in NYC, that has to mean real estate values will go up. Am I right?
Keep on drinking the kool-aid GrandPa!
(Now available at your corner Applebee's!!!)
An inheritance would've been bad for your character Chad. Just suck it up.
Grandpa,
I would suggest demand is not a given. Current demand is driven by job growth, investor interest, renters etc... and the perception that owning is good.
As for supply it may not look so tight if the NYC economy hits the skids. Probable?, hope not. Possible? Maybe.
There are gazillions of Wall Streeters who gross million$ every year. That will never change.
here's the way i see it. half of manhattan residents are wall streeters and they make over half a mil a year on average. so how can there ever be a fallout in real estate prices when it's supported by such money. as for the rest of us, we just have to accept that we might have to move to nebraska to own a decent piece of property.
Say it with me, anonymous . . . there has been a massive credit bubble that has inflated asset values far beyond fundamental values.
NY may corrrect more slowly, but correct it will. Be prepared for 20-40% decline in values over the next 4 years.
R.E. is a cyclical market. This downturn will be worse than others, due to the rapid inflation of property values . . . think of it as the steepest hill on the roller coaster. It's followed by the biggest drop.
Downturns and puny little recessions have very little effect on the wealthy. You think a couple hundred thousand dollars in RE value puts these people in the poor house? This is Manhattan, not middle america.
"half of manhattan residents are wall streeters and they make over half a mil a year on average."
I love when people who know nothing about Manhattan write about Manhattan. Makes a person feel warm all over.
To state the obvious, the bubble will affect the fringe--people who bought for say $1 million and who just make enough to get by. The bread and butter wall streeters' condos will never collapse, because these people have liquid assets up the yingyang.
dark1p, unfortunately the manhattan you know and the manhattan i knew growing up in has evolved into something not too far from what that poster stated. i've lived in manhattan for over 30 years.
Anonymous (well, one of you, anyway), I've been here about that long, too, and while the city has changed, Manhattan is nowhere near 50% Wall Streeters. Nowhere near. The biggest demographic growth of the past five years looks to be the scraggly 20-somethings that no Street firm would hire. Maybe for the mail room. The poster's entire argument is completely wrong-headed, the assessment of Manhattan demographics is completely erroneous, and the vast majority of apartments (and I mean vast) in Manhattan are not multi-gazillion dollar apartments owned by the impervious wealthy. Also, there's the problem of dollars versus Manhattan dollars. My wife and I make about 250g per year, and we're solidly middle-class in Manhattan. If we had a mortgage hanging over our heads and the economy went into a mid-level recession, we'd be cooked. I wish we had stats to refer to, but my guess is about half of the apartment 'owners' in Manhattan are in that general boat, thanks to all of the trading up and refinancing that went on in the past five to ten years. Perhaps I'm not very accurate on this score, but just walk around town--all the neighborhoods. (actually, biking works just as well) Manhattan isn't what it used to be, but there are still a lot of people here who will be in trouble when layoffs start and the kids start moving out. The spiral won't be particularly pretty. By the way, do you plan to stay if we end up anything like the '70s again? Just a hypothetical. I kind of liked it better back then, myself, but we all fall in love with our own New York when we're young.
dark1p: you have a warped sense of what middle class is. Even for NYC.
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