New York’s 1,000-foot-tall symbol of luxury is becoming a monument to the condo slowdown.
Last week, Unit 79 of the condo tower called One57 became the largest foreclosure sale ever in New York. It gone at auction for $36 million – marking a 30 percent decline from its price of $51 million in 2014.
The owner was Kola Aluko, a Nigerian billionaire who’s been charged with funds laundering and was in default on a home loan on the property.
Property boosters in NY called it a one-off, and said sales at One57 and the rest of the new glass condo towers popping up in NY remain strong.
Yet an analysis of recent resales at One57 shows that every apartment which has traded since it opened in 2014 or 2015 has declined in value – all by double digits.
Unit One 62A was first purchased for $31.6 million in April 2014. In October 2016 it purchased for $23.5 million, a 26 percent decline. Device 65A originally purchased for $29.3 million in 2014, but was sold in April 2017 for $22.5 million.
Plus some of the declines were even faster. Device 51C sold for $20.4 million in April 2015. It sold eight weeks in the future for $17.7 million.
Jonathan Miller of Miller Samuel said the money-losing resales aren’t a sign of a condo bust. Alternatively, he said, retailers are finally arriving at grips with the fact that the prices of 2014 were an aberration and aren’t coming back anytime soon. One57, he stated, was at the right place at the right time to capture those top prices.
“It’s clear that 2014 was the peak,” this individual said. “It was a perfect storm. You’d capital pouring into the real estate development market from overseas. And we had merely arrive off the financial crisis and you’d this new product approaching on, with the feeling that everything was skewing toward the wealthy. Everyone thought this was some sort of ” new world ” that would go on forever. But it was not sustainable.”
Miller said generally there are 16 units at One57 for sale, ranging from $3.85 million for a one-bedroom to $70 million for a unit on the 85th floor. That unit originally purchased for $55.5 million.
Yet the problems aren’t confined to One57.
Prices for new condo advancements across Manhattan fell 27 percent in the 3rd quarter compared with a year ago, according to Douglas Elliman and Miller Samuel. But they’re still no bargain: the average sale price was still $4.3 million.