Are developers playing "chicken" with the market?

David Goldsmith

All Powerful Moderator
Staff member
Glut reaction: Manhattan condo inventory finally drops

Unsold new units down 12% from two years ago as buying outstrips new supply​

Developers in Manhattan can breathe a sigh of relief: New condo inventory is finally falling in the borough.
The 6,302 new-development units in Manhattan at the end of the second quarter represented an 11.5 percent drop from 2019, according to a report by Brown Harris Stevens Development Marketing.

A drop like this hasn’t been seen since about 2013 when the market began to bounce back following the Great Recession, said Stephen Kliegerman, BHS Development Marketing president.

It’s a sign that buyers’ confidence is back and driving sales at a brisk enough pace to reduce the Manhattan condo glut that was plaguing developers, lenders and brokers even before the pandemic turned the borough into a ghost town.
“Everyone was concerned that there was going to be 10 years worth of inventory, the New York City real estate market was going to be devastated by this,” Kliegerman said. “Fast forward to July of 2021 and low and behold, we’re absorbing units at a faster pace than we have in a decade.”

Builders, not just buyers, play a role in reducing the condo glut. The drop in inventory means developers are putting fewer units on the market than buyers are taking off.
The report looks at sponsor units on the market or in buildings that are for sale, as well as units in buildings that have not launched sales but are fully financed.
Four hundred ninety-six sponsor units across new developments were listed as new inventory in the second quarter.

The biggest changes in new development inventory occurred in Midtown West, which had 62 percent more units than in the same quarter of 2019, and Lower Manhattan, which had 51 percent fewer.
If contracts for new development condos continue to be signed at the current pace, about 2,000 would be sold by the end of the year, which is 30 percent more than the annual average, said BHS Development Marketing managing director Robin Schneiderman.

Any remaining new development inventory would be sold in as little as 3.5 years.

Lower inventory alleviates financial pressure on sellers and sponsors, as they can produce and sell units and quickly move on to the next one, Kliegerman said.
“If we’re absorbing units, that means developers will continue to build units in the future, adding new inventory, developing underdeveloped areas of the city and providing the latest and greatest in amenities and finishes for future buyers,” he added.

It helps that the majority of new projects offer completed products, which often result in contracts signed at higher rates.
“We anticipate another 4,000 units in the pipeline coming to the market over the next two years including several previously stalled projects coming back online,” Schneiderman said.
 

David Goldsmith

All Powerful Moderator
Staff member
July new development sales contracts shoot up 94%
New condos in the city continued to fly off the shelves last month.

In July, 366 units went into contract, a 94 percent increase from a year ago and 28 percent more than in pre-pandemic July 2019.

The figures on new development deals come from Marketproof, a real estate analytics company that tracks sponsor sales in the city across all price points.

July’s activity was shy of the record levels in April and May The number of sponsor units scooped up in July was down 5 percent from June’s total of 386 contracts.
 

David Goldsmith

All Powerful Moderator
Staff member
HFZ owes XI lender $136M: judge

Children’s Investment Fund sued the developer in January​

The hits keep on coming for HFZ Capital.
The troubled developer was at the losing end of a recent court decision involving a lender on the XI, HFZ’s luxury condo project by the High Line.

A state Supreme Court judge ruled that HFZ owed $136 million to the U.K.-based Children’s Investment Fund, which provided a nearly $1.3 billion loan in 2017 for the West Side development, according to Crain’s. The lender claimed HFZ stopped making monthly interest payments on the loan in April 2020.
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The court delivered a summary judgment late last month, putting HFZ and its chairman, Ziel Feldman, on the hook for the $136 million, plus interest. Stu Loeser, a spokesperson for HFZ, said the company would appeal. He declined to comment further to The Real Deal.

HFZ purchased the project site for $870 million in 2015 and had Bjarke Ingels design dancing towers that included 275 apartments, a 137-key luxury hotel and a spa/wellness center.

Sales have been slow, however, and the developer has been beset with financial problems that have further hampered the project as well as others for the company. HFZ has lost four Manhattan condo projects and a 34-story Midtown office tower to foreclosure.
Last month, the New York attorney general received a complaint that Feldman allegedly offered apartments in the building for sale before filing an offer plan, which could net him a lifetime ban from condo and co-op sales in the state.

The Children’s Investment Fund has scheduled a foreclosure sale on HFZ’s stake in the XI for October.
Ziel Feldman calls Nir Meir a ‘sociopath,’ compares XI lender to mobsters

Facing foreclosure on his signature project, the developer lashes out​

With his signature project slipping from his control, HFZ Capital Group’s Ziel Feldman is slinging some mud.
The embattled developer amended a complaint in a lawsuit he filed earlier this year against former HFZ executive Nir Meir. In the new filing, Feldman pulls out all the stops to blame Nir for HFZ’s collapse.

The complaint calls Meir a sociopath 17 times, accusing him of driving HFZ’s $2 billion XI condo project into the ground and keeping Feldman in the dark about its problems. It compares Meir to Bernie Madoff, disgraced attorney Marc Dreier and convicted former health care executive Richard Scrushy.

Not even Meir and HFZ’s lender, the UK-based Children’s Investment Fund, is spared Feldman’s wrath. The complaint quotes a line from Ray Liotta’s character in the movie “Goodfellas,” comparing the hedge fund to gangsters who burn down a restaurant once they’ve extorted everything they can from it.
“It is an apt analogy because … not only are Mr. Feldman and HFZ facing potential judgments in the amount of nearly $300 million, but TCI has also sought to take control of the valuable XI project through a UCC foreclosure sale,” the amended complaint reads.

Larry Hutcher, co-managing partner at Davidoff Hutcher & Citron, who represents Meir in the lawsuit, said it’s “ludicrous” for Feldman to say “he had no knowledge of what took place inside his own business.”
“This was a desperate act by Ziel to salvage his otherwise unsalvageable reputation,” said Hutcher.

The lawsuit alleges that Nir illegally charged personal expenditures to HFZ, including $10,000 weekly sushi dinner parties, millions of dollars’ worth of wine, five different Mercedes (including an AMG model), a Cadillac Escalade, two Porsche 911s and an Aston Martin. It accuses Nir of misusing HFZ funds to lease a $150,000-per-month Miami Beach home.

The complaint comes after TCI scheduled a foreclosure auction to take control of HFZ’s ownership stake in the XI, a mixed-use development on the High Line.
Earlier this month, a judge ordered HFZ and Feldman to pay $136.2 million to TCI over defaulted loans tied to the XI. HFZ and Feldman are appealing.

HFZ originally filed a tamely worded complaint against Meir in April, accusing the former executive of defrauding the development firm and hoarding fringe benefits including a pricey Hamptons home.
But after filing the original complaint, HFZ retained Morrison Cohen litigator David Scharf, an attorney known for representing high-profile real estate clients such as Donald Trump — and for crafting legal complaints geared as much toward public relations as to laying out a legal argument.

The Real Deal was sent the complaint earlier this week by HFZ’s new spokesperson, Stu Loeser, who represented Michael Bloomberg for six of his 12 years as mayor.
The new filing brings TCI into the mix, arguing that the hedge fund went along with Meir’s alleged misuse of project funds on the XI and willfully ignored its due diligence duties because, HFZ argues, the lender knew that if the project went bust it could snap it up in foreclosure at a rock-bottom price. (TCI is not a defendant in the case.)

The amended complaint increases the damages HFZ is seeking from Meir from a piddling $43 million to an attention-grabbing $688 million, based mostly on the new claim that Meir lied to HFZ about the XI being on sound footing, causing more than $600 million in damage.
This is not the first time that Feldman has painted Meir as the main culprit for HFZ’s mounting financial woes.

HFZ has alleged in previous lawsuits that Meir forged his signature on loan documents. In one case against a purported lender to HFZ, Feldman’s legal team hired a forensic handwriting expert to analyze his signatures. The expert could not determine whether Feldman’s signatures were forged.
Feldman founded HFZ in 2013, focusing on converting pre-war Manhattan rental buildings into high-end condominiums. Meir and Feldman parted ways in December as the HFZ’s real estate portfolio started unraveling and its properties faced foreclosure. HFZ has claimed that Meir was fired, while Meir previously told TRD through a spokesperson that he was stepping down from HFZ but remained a “vested partner.”
 

David Goldsmith

All Powerful Moderator
Staff member
"As of February, all but six sales contracts had been rescinded for the project’s 99 units, according to a transcript of a Feb. 25 hearing."
 

David Goldsmith

All Powerful Moderator
Staff member
From what I can tell Sponsor negotiability is driving a shift in deal flow from resales toward new dev sales.
New development sales contracts jump 109% in New York

Some 421 contracts were signed last month in NYC​

The pace of new development sales contracts are barely slowing in New York, even as the coronavirus stages a comeback.
Some 421 contracts were signed across the city in August, up 109 percent from a year ago and 88 percent more than August 2019, according to a monthly analysis of new development sales contracts by Marketproof, a real estate analytics company. That made it the fourth-busiest month since 2015, beaten only by March, April and May of this year.

Velocity slowed at the end of July, leading Kael Goodman, CEO of Marketproof and the report’s author, to wonder whether the increasing spread of Delta might presage a slow August. That didn’t prove to be the case.
“We had another amazing, amazing month,” Goodman said. “No Delta dip.”
Most of last month’s contracts were signed in Manhattan and Brooklyn. Manhattan had 196 deals, followed by Brooklyn’s 185. Queens had 39.

The best-selling projects that reported the largest number of contracts were Related Companies’ Lantern House, 130 William Street, 11 Hoyt Street in downtown Brooklyn and an Astoria project at 32-86 33rd Street.
Notably, the new development condominium market grew last month while the resale market had a month-over-month decline. Although 533 resale contracts were signed, which outnumbered August’s new developments condo contracts, that marked a 7 percent decline compared with July for the resale market. For new development condos, August’s activity was up 16 percent from July’s.

“What it shows is a preference for new,” Goodman said.
 

David Goldsmith

All Powerful Moderator
Staff member
Huge jump in New Dev contracts signed this week.

This week's New Development Report from Sotheby's Kevin Brown Team. unnamed(14).jpg
 

David Goldsmith

All Powerful Moderator
Staff member
Los Angeles edition.

Nile Niami’s Bel Air behemoth enters receivership​

Spec developer defaulted on $165M he borrowed to build 100K sf “The One”​

Nile Niami’s “The One” is in court-appointed receivership after the spec developer defaulted on more than $165 million in debt he borrowed to build the Bel Air behemoth.
Niami borrowed most of the money from Don Hankey’s Hankey Capital to develop the 105,000-square-foot property; he also used three other lenders. CNBC first reported the property entered receivership, citing Los Angeles County Superior Court documents.

The court named Ted Lanes of Lanes Management as receiver. He is tasked with preparing The One for sale and selling it to recoup debts owed to lenders.
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The One is expected to hit the market in the coming months, after Lanes can secure a certificate of occupancy, which has been lingering. He said he “would love to see” the house completed and an “orderly sale that maximizes the value,” of the property.
“Hopefully, there will be sufficient proceeds from the sale to fund the secured and unsecured creditors and for the equity to realize some value,” Lanes said, according to the report.

Hankey Capital, which provided Niami with around $115 million in 2018 to build the palace, served a notice of default in March. Joseph Englanoff’s Yogi Securities Holdings provided another $36 million, while Inferno Realty and Maybach Corporation Holdings each provided around $7 million for construction, according to CNBC.
The massive home sits on an eight-acre promontory overlooking L.A., and includes five swimming pools, a 50-seat home theater, beauty salon, four-lane bowling alley and 20 bedrooms. The main suite is more than 4,000 square feet. The planned jellyfish tank and frozen room with ice bar were nixed, however.

Work was already about a year behind schedule in 2018 when Niami said the mansion would list for $500 million.
A spokesperson for the developer claimed in November that workers were putting the “finishing touches” on the interior. A month later, Niami tapped Rayni and Branden Willians of Beverly Hills Estates and Compass’ Aaron Kirman to market the monster mansion.

Rayni Williams at the time said that The One could list by the end of last year, but a listing never surfaced.
Niami has had his hands full with other developments as well. In December, he threw a West Hollywood spec mansion into bankruptcy and sold his own home in the Hollywood Hills.
A few months later, he sold two Bel Air spec homes for $36 million each. Niami also unloaded a 14,000-square-foot project in the Hollywood Hills last month for $26 million.
 

Noah Rosenblatt

Talking Manhattan on UrbanDigs.com
Staff member
Ziel Feldman calls Nir Meir a ‘sociopath,’ compares XI lender to mobsters

Facing foreclosure on his signature project, the developer lashes out​

With his signature project slipping from his control, HFZ Capital Group’s Ziel Feldman is slinging some mud.
The embattled developer amended a complaint in a lawsuit he filed earlier this year against former HFZ executive Nir Meir. In the new filing, Feldman pulls out all the stops to blame Nir for HFZ’s collapse.

The complaint calls Meir a sociopath 17 times, accusing him of driving HFZ’s $2 billion XI condo project into the ground and keeping Feldman in the dark about its problems. It compares Meir to Bernie Madoff, disgraced attorney Marc Dreier and convicted former health care executive Richard Scrushy.

Not even Meir and HFZ’s lender, the UK-based Children’s Investment Fund, is spared Feldman’s wrath. The complaint quotes a line from Ray Liotta’s character in the movie “Goodfellas,” comparing the hedge fund to gangsters who burn down a restaurant once they’ve extorted everything they can from it.
“It is an apt analogy because … not only are Mr. Feldman and HFZ facing potential judgments in the amount of nearly $300 million, but TCI has also sought to take control of the valuable XI project through a UCC foreclosure sale,” the amended complaint reads.

Larry Hutcher, co-managing partner at Davidoff Hutcher & Citron, who represents Meir in the lawsuit, said it’s “ludicrous” for Feldman to say “he had no knowledge of what took place inside his own business.”
“This was a desperate act by Ziel to salvage his otherwise unsalvageable reputation,” said Hutcher.

The lawsuit alleges that Nir illegally charged personal expenditures to HFZ, including $10,000 weekly sushi dinner parties, millions of dollars’ worth of wine, five different Mercedes (including an AMG model), a Cadillac Escalade, two Porsche 911s and an Aston Martin. It accuses Nir of misusing HFZ funds to lease a $150,000-per-month Miami Beach home.

The complaint comes after TCI scheduled a foreclosure auction to take control of HFZ’s ownership stake in the XI, a mixed-use development on the High Line.
Earlier this month, a judge ordered HFZ and Feldman to pay $136.2 million to TCI over defaulted loans tied to the XI. HFZ and Feldman are appealing.

HFZ originally filed a tamely worded complaint against Meir in April, accusing the former executive of defrauding the development firm and hoarding fringe benefits including a pricey Hamptons home.
But after filing the original complaint, HFZ retained Morrison Cohen litigator David Scharf, an attorney known for representing high-profile real estate clients such as Donald Trump — and for crafting legal complaints geared as much toward public relations as to laying out a legal argument.

The Real Deal was sent the complaint earlier this week by HFZ’s new spokesperson, Stu Loeser, who represented Michael Bloomberg for six of his 12 years as mayor.
The new filing brings TCI into the mix, arguing that the hedge fund went along with Meir’s alleged misuse of project funds on the XI and willfully ignored its due diligence duties because, HFZ argues, the lender knew that if the project went bust it could snap it up in foreclosure at a rock-bottom price. (TCI is not a defendant in the case.)

The amended complaint increases the damages HFZ is seeking from Meir from a piddling $43 million to an attention-grabbing $688 million, based mostly on the new claim that Meir lied to HFZ about the XI being on sound footing, causing more than $600 million in damage.
This is not the first time that Feldman has painted Meir as the main culprit for HFZ’s mounting financial woes.

HFZ has alleged in previous lawsuits that Meir forged his signature on loan documents. In one case against a purported lender to HFZ, Feldman’s legal team hired a forensic handwriting expert to analyze his signatures. The expert could not determine whether Feldman’s signatures were forged.
Feldman founded HFZ in 2013, focusing on converting pre-war Manhattan rental buildings into high-end condominiums. Meir and Feldman parted ways in December as the HFZ’s real estate portfolio started unraveling and its properties faced foreclosure. HFZ has claimed that Meir was fired, while Meir previously told TRD through a spokesperson that he was stepping down from HFZ but remained a “vested partner.”
Evergrande too?
 

David Goldsmith

All Powerful Moderator
Staff member

What Is China Evergrande and Why Is It In Trouble?​

China Evergrande Group is quickly becoming the biggest financial worry in a country with no shortage of them. With $300 billion in liabilities and links to myriad banks, Evergrande could send shock waves through the financial system and the broader economy should calamity strike. Its stock price has cratered and its bonds point toward potential default, yet Hui Ka Yan, the billionaire owner, has sought to reassure bankers that the property company will pull through. Investors aren’t sure how. They’re also asking whether major Chinese companies are still considered too big to fail by the central government, which prizes stability -- and what happens if they’re not.
1. What’s Evergrande?
Hui founded Evergrande (formerly called the Hengda Group) in 1996 in the southern city of Guangzhou and expanded the real-estate developer, largely by borrowing. Evergrande Real Estate owns more than 1,300 projects in more than 280 cities, according to a company website. The group now goes far beyond homebuilding, with investments in electric vehicles (Evergrande New Energy Auto), an internet and media production unit (HengTen Networks), a theme park (Evergrande Fairyland), a soccer club (Guangzhou F.C.) and a mineral water and food company (Evergrande Spring), among others. It reported an adjusted core profit of 30.1 billion yuan ($4.7 billion) for 2020, the second annual drop in a row, and revenue missed analysts’ estimates.

2. What started the trouble?

The world’s most-indebted developer had a liquidity scare in 2020. Evergrande reportedly sent a letter to the provincial government of Guangdong (Guangzhou is the capital) in August, warning officials that payments due in January 2021 could cause a liquidity crisis and potentially lead to cross defaults in the broader financial sector. Reports of the plea for help emerged on Sept. 24, sending Evergrande’s stock and bonds tumbling even as the company dismissed the concerns. The letter, which was widely circulated on social media, was verified to Bloomberg at the time by people familiar with it, but Evergrande later disputed its authenticity. Crisis was averted soon after when a group of investors waived their right to force a $13 billion repayment.
3. That wasn’t enough?
The reprieve was temporary, as there was still lots more debt coming due later. Evergrande outlined a plan to cut its $100 billion debt pile roughly in half by mid-2023, including a series of assets sales and stock offerings. (The company has some $80 billion worth of equity in non-property businesses, according to Agnes Wong, a Hong Kong-based analyst at BNP Paribas SA.)

Coming Due​

Evergrande needs to repay some $7.4 billion of maturing bonds next year

Source: Bloomberg
Note: Totals for HKD and yuan-denominated debt converted into U.S. dollars as of Sept. 14.

4. How’s it going?​

Evergrande has raised about $8 billion this year as of August, selling shares in its EV unit, HengTen, a Hangzhou property firm and a regional bank. It’s also said to be exploring a listing for its tourism business and possibly the water business too. None of those offer quick fixes, however, because any sales probably wouldn’t be completed before next year. Meanwhile, the company’s debt has been repeatedly downgraded; Fitch Ratings said on Sept. 8 that a default seemed probable.

5. What about more borrowing?​

Asia’s biggest issuer of junk bonds hasn’t sold a single dollar note since January 2020 as it looks to reduce its debt load. In any case, Hui’s been under pressure from the government in Beijing to cut borrowing in recent years. But he could still tap fellow tycoons, as he’s done in the past. He increased financial ties with real-estate empires run by members of the Big Two Club, so-called because of their fondness for a Chinese poker game. In all, the three poker pals were involved in at least $16 billion of transactions with Evergrande over the past decade. Another benefactor emerged in July when Asia Orient Holdings Ltd., led by secretive tycoon Poon Jing, added to its big position in Evergrande bonds.

6. How much time is there?​

Not much. It needs to make $669 million in coupon payments through the end of this year. Some $615 million of that is on Evergrande’s dollar bonds, Bloomberg-compiled data show. Next March, $2 billion of Evergrande’s outstanding bonds come due, followed by $1.45 billion the following month. While Evergrande has repaid all its public bonds this year, refinancing in 2022 would be challenging if the developer’s access to capital markets doesn’t recover in time, S&P said.

Interest Payments​

Evergrande has $669 million of coupon payments remaining this year

Source: Bloomberg
Note: Local bond interest converted to dollar amount. Data as of Sept. 13 for payments through 2024.

7. Any chance of a government bailout?​

The central or provincial governments or state-owned enterprises could step in with some sort of lifeline or forced restructuring. Beijing was said to have instructed authorities in Guangdong to map out a plan to manage the firm’s debt problems, including coordinating with potential buyers of its assets. Regulators in September signed off on a proposal to let Evergrande renegotiate payment deadlines with banks and other creditors, paving the way for another temporary reprieve.

8. Why wouldn’t they save it, if it’s so important?​

It’s a dilemma. A bailout would tacitly condone the type of reckless borrowing that’s gotten one-time high-flyers like Anbang Group Holdings Co. and HNA Group Co. into trouble too. Ending moral hazard -- a tolerance in business for risky bets in the belief that the state will always bail you out -- also would make the financial system more resilient over the long run. But allowing a big, interconnected company like Evergrande to collapse would reverberate across the financial system and also be felt by many millions of Chinese homeowners. Such pain could stir discontent and weaken the Communist Party’s control.
 

David Goldsmith

All Powerful Moderator
Staff member

Glut reaction: NYC’s unsold condo inventory is finally receding​

A long-awaited auspicious sign has developers hopeful for a market rebound​

After years of drowning in unsold inventory, New York City’s condo developers reached perhaps their most desperate hour this spring, a year into a pandemic that had their prime buyers fleeing the city. Discounts abounded as builders rushed to fill units, repay lenders and avoid foreclosure.
Buyers pounced on the concessions. When the dust settled, the second quarter had seen more Manhattan condo sales close than any quarter since 2015, reducing overall inventory, according to appraisal firm Miller Samuel. Citywide, new development sales soared to record highs in April and again in May, according to data from Marketproof.
The number of new development condominiums on the market is finally starting to fall, reversing a six-year trend, but analysts say sellers eager to seize back the market will need to be patient.
Non-shadow condo listings in Manhattan were 4.4 percent lower in the second quarter of the year than in the same period of 2019, according to Miller Samuel.
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“[The year] isn’t finished, and we haven’t had the second sales bump of the fall,” said Miller Samuel CEO Jonathan Miller. “2021 is looking like it’s going to be the first year since 2015 where we’re seeing the number of years to sell out on the decline.”
An August report by Brown Harris Stevens Development Marketing, which factored in shadow listings, found that new development listings in the second quarter fell 11.5 percent from 2019.
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“We are seeing active inventory decline, in part because the high end of the market — whether it’s a new development or a resale — has seen a more active market in 2021,” Miller said.
It’s been years since Manhattan’s new development market was humming. In 2013, frenzied buyers were purchasing homes with nothing more than floor plans to go on, driving up prices and coaxing more developers into the space. By 2015, sales were so brisk that the existing supply of new development condo units would have sold in 2.3 years, a third faster than the usual 3.5, Miller said.

Stubborn surplus

Then, everything changed.
With a large batch of units in the pipeline, more units were being added than sold, said Garrett Derderian, director of market intelligence at Serhant. The brokerage says 14,672 units were brought onto the market between 2015 and 2017. Lenders saw the glut developing and got cold feet.

“It became increasingly difficult for developers to finance condominiums,” said Kenneth Horn, president of Alchemy Properties, a Manhattan-based condo developer and investor.

Lenders and equity providers argued that there were too many condos on the market and at unattainable prices, Horn said.
Developers began to respond with concessions, but just as they did, the luxury sector suffered several blows, including a strengthening U.S. dollar that reduced foreigners’ purchasing power and state lawmakers’ passage of a 4.15 percent mansion tax. Buyers pulled back even more in the second half of 2019, forcing sellers to consider uncomfortable decisions such as bulk sales.

“By the end of 2019, we started to see a slight turnaround in the market through January 2020,” Derderian said. “We forecasted 2020 initially to be a strong year, but of course with Covid that changed.”
The perpetual struggles of the past few years might have done some good. Sellers were forced to become less aspirational with their pricing, presenting buyers with offers that led to sales picking up speed.

Turning point

In May, the Financial District had the most unsold units of any neighborhood in the city. Since then, sales at buildings such as 130 William Street, 25 Park Row and the Broad Exchange Building — coupled with a lack of new supply — have eroded the number of unsold units by 10 percent, according to Marketproof.

That isn’t to say the condo glut is gone. The neighborhood still has more than 1,300 units waiting to be sold. Many of them have yet to be listed.
But the surplus has shrunk. Unsold inventory fell 2.5 percent across New York City over the past year, according to Marketproof. In Manhattan, it fell 2 percent, with the number of available units declining in two of the past four quarters. The second quarter saw fewer project sales launch while the pace of sales remained relatively strong, Marketproof said.

Last year, the time it would take to sell out all new development condos in Manhattan peaked at 8.7 years, Miller said. Thanks to an uptick in sales, it’s now at 7.2 years — still the second-slowest pace he’s tracked since sales peaked in 2014, he added.
On the bright side, if the trend continues, that number could fall to six years by 2022, Miller said.
“Over the next year or two, we’ll see sales continue to be relatively robust compared to previous years, assuming rates stay where they are and Covid is brought under control,” Miller said.

Easing of travel bans is expected to bring more international demand, and discounting and negotiability are sure to decline, he added.
When it comes to unsold units, Manhattan sits between two of its neighbors. In Brooklyn, the number of unsold units dropped 13 percent over the past year and listings have fallen for four consecutive quarters, according to Marketproof.

Queens, on the other hand, saw inventory increase by 10 percent, driven by larger buildings launching sales in the first half of this year. At 88-08 Justice Avenue, 184 units were listed in the first quarter, and 41-62 Bowne Street listed 95 in the second.
Horn has seen this happen repeatedly over the course of his 30-year career. His strategy: develop countercyclically.

Horn credits some of his most successful buildings to this strategy, and with inventory starting to fall, he’s betting that his decision not to lay low at the height of the glut will make 378 West End Avenue, his new luxury development on the Upper West Side, another win.
“I see it every three years, every four years, it’s the same thing. There’s an oversupply, and the participants and the lenders scale back,” Horn said. “That inventory gets eaten away, and lo and behold there’s a scarcity of units in the marketplace because no one developed at the correct time.”
 

inonada

Well-known member
Last year, the time it would take to sell out all new development condos in Manhattan peaked at 8.7 years, Miller said. Thanks to an uptick in sales, it’s now at 7.2 years — still the second-slowest pace he’s tracked since sales peaked in 2014, he added.
On the bright side, if the trend continues, that number could fall to six years by 2022, Miller said.

 
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