The Week in Real Estate: 8.14.09

In the late 17th and early 18th centuries, the Gobelins manufactory wove tapestries for Louis XIV, the absolutist French ruler, who espoused the theory of the divine right of kings. According to that theory, dauphins were not merely born lucky onto plush velvet thrones of ungodly wealth and power. No, they actually carried the mark, indeed the ordination, of the divine.

In the 21st century, you can walk up Madison Avenue, turn right onto 61st Street and enter a recessed cove well removed from the commoners’ foot traffic. Pass through the doors and into the 40-foot-tall limestone lobby of 667 Madison Avenue, arguably the most exclusive office building in New York City, and you will find, on the wall behind the bow-tied concierge, one of those Gobelins tapestries.

The message could not be clearer: Here live the Sun Kings. More here.

The Times columnist, Princeton professor, recent Nobel winner, and all-around ceaselessly smart economist Paul Krugman has a nice new co-op. More here.

Jacky Teplitzky, who was a sergeant in the Israeli army before she became a top broker at Prudential Douglas Elliman, was on the phone with an Upper East Side seller earlier this year. “Without going to the apartment, my opening statement was, ‘Do you understand you’re going to lose money?’”

Manhattan brokers, who used to practically guffaw about New York’s beautifully, effortlessly, naturally rising luxury real estate prices, are conceding that gargantuan real estate bought during the boom will likely sell at gargantuan, maybe multimillion-dollar, losses.

What was once a freakish nightmare—only the masses take losses!—is now accepted with a matter-of-fact shrug: “Panic at the Plaza” was the headline in October on the Web site Curbed when the asking price for a unit bought for $14.94 million was lowered to $14.5 million. More here.

Property Shark.


Nicole Ferejohn, 27, was paying $1,200 per month to rent a walk-up apartment on Avenue A and St. Marks about a year ago when she decided that it was time to own, invest, reduce the tax load a bit. She was thinking brownstone, original moldings, maybe some brick or a tin ceiling, a quirky layout.

“But then I started looking and I was like, ‘Holy bejesus, they’re all like a million dollars!’” said Ms. Ferejohn, who works at Bank of America Merrill Lynch.

She never before would’ve considered the glossy new condo developments in various Brooklyn neighborhoods that advertise stainless steel appliances, doormen, contemporary sinks and globular light fixtures. But the market had faltered, they were suddenly in her price range, and hell, what’s so wrong with nice views anyway? More here.

Jeff Gural (left), 67, and Jimmy Kuhn, 61, are chairman and president, respectively, of brokerage Newmark Knight Frank, as well as landlords of millions of square feet of New York.

Location: Do you ever get bored waiting for the market to recover?
Mr. Kuhn: God, this is great! I don’t get bored waiting for the market to recover. I go look for opportunities! This is the greatest mining time we’ve had in the last 10 years. … And if you’re a tenant-rep broker, and I’m not, tenants now feel the market is at the bottom. I think the economic statistics indicate we’ve sort of hit bottom in terms of rental value. Jeff may disagree. And at least tenants are starting to write leases again.

Do you agree that we’ve hit bottom, Jeff?
Mr. Gural: Yeah, I think you’ve got a dynamic where you have landlords like ourselves, the old families who don’t have a lot of debt and who have owned the buildings a long time and have the flexibility of adjusting to the market, which is what we basically have done. …More here.

Shravan Vidyarthi.

This past Tuesday was the 500th day on the market for the Pierre’s 7,000-square-foot, 14-room, five-bedroom, seven-bathroom, 35-closet duplex. It was back in November 2007 that the ailing private-equity titan Lionel Pincus listed the Fifth Avenue sprawl for $50 million, making it New York’s second most expensive co-op. The duplex was taken off the market last year but re-listed a few months later—against the wishes of Mr. Pincus’ companion, Princess Firyal of Jordan, who lost out in Surrogate’s Court last year after trying to block its sale.

It was also on Tuesday, as these things so marvelously go, that Mr. Pincus’ two sons filed suit against the princess in State Supreme Court, requesting, among other things, that she be prevented from impeding the duplex’s sale. Read more.


Facebook, the time-devouring, procrastination-rewarding, world-dominating social networking site, has traded its New York digs on Fifth Avenue (in Midtown) for larger space at 340 Madison Avenue (also in Midtown). More here.

There are two ways to get an apartment in Red Hook.

If you live there, you ask around. “Everyone knows what everyone’s paying and who owns what and who’s moving, so it’s mostly done really casually,” says Bevin Strand. Another resident’s account is typical: “A guy we knew from the bar who used to play with Smokey knew we were looking, and put us in touch with his friend who was moving out.”

Otherwise, you talk to Rachel Shapiro. More here.

Chris.Szabla via Flickr.

College students: They are wide-eyed, they are eager, and they will be resuming their studies in but a few short weeks! So how easy is it to dupe them? Unscrupulous Craig’s Listers are optimistic.

Today's first lesson is that Brooklyn is not close to New York University. More here.



The world is falling to pieces. Snap them up while you can.

Tarter Krinsky & Drogin, one of the few law firms expanding in the recession, has just signed a 13-year expansion and renewal for 26,800 square feet at W&H’s 1350 Broadway.

“We’re in a unique position,” said Alan Tarter, managing partner at the full-service firm. “We have been the beneficiary of attracting talent from larger firms.” And business.

More here.


Is a shiny new Park Avenue condo fated to become the next Sheffield57?

On behalf of the owners of the building's 110 units, the board of managers of the luxury condominium 260 Park Avenue South is suing the building's landlord, Tessler Developments, over a first floor concrete hole. More here.

Property Shark.

Both the Foundry and L Haus, two Long Island City condo developments marketed by Prudential Douglas Elliman, seemed to be presenting themselves as urban oases—nooks of green in Queens. They offered outdoor space aplenty, plant-oriented décor in their sales offices, enormous bathtubs, green literature and logos, and, in the case of L Haus, a lime green façade.

A poster for the nearby Hunters View condos took a more practical approach. “Commute like a rocket,” it said, next to a stock photo of a business guy in a train station.

It takes 16 minutes to get from Hunters Point to Grand Central.

Brokers at Long Island City’s glut of condo developments can tout their finishes, their amenities, their hesitantly gentrifying neighborhood. But convenience remains the most surprising—and compelling—factor in the area’s favor. All hail the Vernon Boulevard 7 stop. More here.


Talent agency William Morris Endeavor Entertainment—the creature born of April’s Endeavor–William Morris coupling—is hunting for new, combined office space in Manhattan, digs befitting its new image, whatever that may be.

Actually, if Ariel Emanuel is anything like Entourage’s Ari Gold (the character inspired by him) or his brother Rahm, we have some idea: cutthroat, sleek, shiny in a fake, L.A. sort of way. More here.

Property Shark.

Manhattan retail rents continued to fall in the first half of 2009, according to a report from CB Richard Ellis, reflecting an “ongoing weakness” that appears to be affecting retailers toward the higher end more than shops targeted to bargain hunters.

The toniest stretch of Madison Avenue, from 57th to 72nd streets, was the hardest hit. More here.

A small positive for Mizuho Bank, whose stock has lately been performing on the unimpressive side: It  succeeded in unloading 27,030 square feet at One State Street Plaza. T3 Capital Management has signed a 13-year sublease for the space, with the asking rent $45 a square foot. Norman Bobrow, of the eponymous Norman Bobrow & Company, represented the tenant in negotiations with CB Richard EllisRobert Flippin and Adam Foster, who repped the Japanese bank. More here.

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