Vision Quest: Financial District
A: To be a savvy real estate investor you MUST have vision. You MUST be able to see past a wreck, or past what is currently going on in a specific neighborhood and look at what is TO COME in the medium term future. By that I mean, 3-5 years or so from now. If you want to go a bit longer term, have a 7-10 year vision for change. As a contrarian investor I think along these lines so that I can buy low and sell higher; so you have to look into buying into a property or neighborhood that might not be so desireable right now, but could very well be because of development plans later on. Todays topic is the financial district and the motivation behind it was Larry Silverstein's statements at the Inman Conference on Tuesday.
Who is Larry Silverstein: Larry A. Silverstein serves as President and CEO of Silverstein Properties, Inc., a Manhattan-based real estate development and investment firm that has owned, managed and developed over twenty million square feet of office, residential and retail space.
In July 2001, Mr. Silverstein completed the largest real estate transaction in New York history when he signed a 99-year lease on the 10.6 million sq. ft. World Trade Center for $3.25 billion, only to see it destroyed in terrorist attacks six weeks later on September 11, 2001. He is currently rebuilding the office component of the World Trade Center site, an $8-billion project that will consume the balance of his working life.
Mr. Silverstein is a member of the New York Bar and a Governor of the Real Estate Board of New York, having served as its Chairman. He is Vice Chairman of the New York University Board of Trustees and is the Founder and Chairman emeritus of the New York University Real Estate Institute. As a Professor of Real Estate, his “Silverstein Workshop” became one of the most attended and informative educational sources for learning real estate development and investment analysis.
What He Said At Inman Conference - Mr. Silverstein was on a panel along with the President's & CEO's of Elliman, Corcoran Group, and Halstead as well as Steven Spinola of REBNY. The discussion was about 'Predicting Real Estate's Future Trends'.
During the discussion he started talking about real estate vision and how one can not discount the incredible amount of money being poured into the Financial District by developers, the city, the MTA, and private equity investors. The numbers are truly astounding! On a 16 acre area of land, $16,000,000,000 worth of re-development is taking place over the next 5 years or so to rebuild ground zero, infrastructure, new commercial office space, a memorial, parks, retail and more. That means $1,000,000,000 per acre worth of development which is just an insane amount of investment for such a concentrated peice of Manhattan Real Estate! This became a repeated quote as the panel carried on as the Moderator, Michael Rogers, just couldn't get past the scale of development and monies involved that was taking place.
The Skinny - The Financial District and around ground zero in the 16 acre section (that Mr. Silverstein was talking about - not sure of exact grid range) that is being invested in will be drastically different in 5 years or so when most work is going to be coming close to completion! Buildings have already started converting to condo to spark residential interest, as Mr. Silverstein pointed out, and many more conversions are expected. In short, it is expected that the quality of life in this area will be drastically improved from what you see now drawing a new interest in living closer to where you work.
This is something that most people will find hard to believe, as the reputation of this neighborhood now is one of a workforce and not residential, but I have a feeling those 'in-the-know' of what is to eventually come in this neighborhood in 5 years time will think much differently.
There are a number of condo conversions currently being marketed right now which include:
The South Star Condos - 80 John Street
Cipriani Club & Residences - 55 Wall Street
The Croft Building - 71 Nassau Street
Cocoa Exchange NY - 1 Wall Street Court
The Downtown Club - 20 West Street
130 Fulton Street - 130 Fulton Street
50 Pine Street - 50 Pine Street
William Beaver House - 15 William Street
Downtown By Philippe Starck - 15 Broad Street
Comments (2)
parks? there are no serious parks in that area? It doesnt feel homey, and it has a very sterile feeling, almost industrial. What are they going to do about that?
Posted by justin williams | January 15, 2007 4:40 PM
Justin,
Just telling you what was said at the conference by Mr. Silverstein. The best site I can find for renderings are:
http://www.buildthememorial.org/site/PhotoAlbumUser?view=UserPhotoDetail&PhotoID=12551&position=5&AlbumID=5467
Not sure about other plans for parks near the area, but again, this is what he said and I was just reporting on it. His philosophy, is that a changing trend will be that people want to live closer to where they work and that the amount of money being poured into such a small area, is going to produce changes that people find hard believing in.
Thats the sense I got from his speech.
Posted by Noah | January 15, 2007 4:49 PM