New York luxury homeowners confident of finding buyers amid coronavirus-induced market rout

Cheryl Arcibal

Luxury homeowners and developers in New York are putting multimillion-dollar abodes on sale, confident that deep-pocketed investors will pay top dollar for exclusive property, even as the coronavirus pandemic threatens to push the US economy into a recession.

But some market observers doubt such property will find buyers amid a glut in supply of high-end condominiums and a recent downturn in US stock markets that saw the Dow Jones Industrial Average plunge 3,000 points on Monday for its biggest ever one-day drop.

A town house belonging to the late I.M. Pei, the famed architect of the Louvre museum in Paris and the Bank of China Tower in Hong Kong, is among those that have gone on the market recently. Pei’s four-bedroom town house, perched above Manhattan’s East River, is on sale for US$8 million.

“The New York market is experiencing oversupply right now, and this is in part because of the tremendous amount of development that took place after the financial crisis in 2008,” said Ilyse Dolgenas, special counsel at law firm Withers’ New York real estate team. The glut, however, is in high-end luxury condos rather than in those priced at the US$2 million to US$5 million range, she added.

Global stock markets, including those in the US, have been experiencing wild swings and volatility over the past week as the pandemic accelerate in Europe and the US. It has infected nearly 180,000 people in more than 130 countries and claimed over 7,120 lives as of early Tuesday. As the outbreak threatens to send the global economy into recession, central banks from China to the US have injected liquidity and reduced interest rates to improve market confidence.

Earlier this month, the Chinese owner of Waldorf Astoria started the sale of 375 luxury condominium units. The upper floors of the storied hotel are being converted into residential units. The entire property, which will include the 375-key hotel, will welcome residents and guests in 2022.

Knight Frank and Douglas Elliman are among the agents who are leading off-plan sales, where a 526 square feet studio has a starting price of US$1.7 million.

Luxury condos at the converted Waldorf Astoria building set to debut amid a glut in Manhattan

The city’s shopping and entertainment centres and its top-tier educational institutions are also among the top draws.

“We see a range of interest in properties across all product sizes and price points – from one- to two-bedroom apartments to spectacular full floor mansions in the sky,” said Erin Boisson Aries, broker at Christie’s International Real Estate in New York. “With an eye on investment opportunities, Chinese buyers are particularly drawn to the highly serviced apartments in central locations.”

A flat at One Beacon Court has been viewed a number of times by Chinese investors, which has an asking price of US$34 million. Photo: Handout

A project that is attracting particular interest from Asian buyers is a 9,000 sq ft duplex penthouse at One Beacon Court, which offers stunning views of the city and Central Park. The property is listed for US$34 million. Another is a high-floor, one-bedroom unit at One57 listed for US$4.25 million.

Withers’ Dolgenas said that the current uncertainties are making investors “cautious”. “At the moment, the city is absorbing what’s going on, and people are waiting to see what happens in the stock market,” she said.

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