Financial District Real Estate Thrives Recession

Author: Tara Lynn Wagner, NY1
Date: Friday, February 6

In Manhattan’s Financial District, landlords have taken stock of the real estate market and are banking on incentives to keep inventory moving.

NY1's Tara Lynn Wagner filed the following report.

Residents who want fantastic views, great amenities and maybe even their own gargoyle should bank on Wall Street, where converted office buildings put luxury within reach."If your taste is ultramodern, but you maybe cannot afford maybe ultramodern in Chelsea or SoHo, you can come down to the Financial District and really live like a king in an ultramodern, beautiful, amenity-packed space for much less money," says Mark David and Company broker Karla Saladino. For instance, an 1800-square-feet downtown loft by Starck, which was once the headquarters of J.P. Morgan, is on the market for less than $1,000 per square foot, far below comparable units Uptown.

"In this time of crisis, people are looking for only one thing and that's value," says Urban Sanctuary Executive Vice President Elie Pariente. "So if they are looking for an apartment, people are looking for the neighborhood that's going to offer the most value for their money - and that's certainly Downtown."The conversion of the Financial District doesn't end with condos. Over the past 10 years, as more people have moved in, so have high-end retailers and restaurants, meaning the area no longer shuts down with the stock market's closing bell. "Now that thousands of new residential tenants are calling this their home, you know, they want to come down, they want to party, and the businesses are reacting," says Saladino.

Since each new conversion brings hundreds of units to the market, rental inventory remains high. To fill these spaces, management companies are offering a range of incentives."They're offering free rent. They're offering to pay the brokerage fees," says Saladino. "At Mark David, we have been able to move our clients down here into fabulous luxury studios for under $2,000, where the landlord pays the fee and they maybe even get a month or two for free." Buyers are getting breaks too. New buildings come with 10-year tax abatements and developers are also making concessions to move their properties.

"As opposed to two years ago, when the contracts were standard, now we're seeing more and more contracts being literally customized with certain things such as mortgage contingencies, different down payments," says Pariente. Being an emerging neighborhood, affordability in the Financial District may be fleeting. Purchase prices in the neighborhood rose across the board in 2008, with the average sale price of a studio jumping 18 percent. With the anticipated openings of high-end projects like the Setai and the William Beaver House, realtors expect the Financial District to thrive, despite the recession-plagued financial market.

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