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Condos With Hotel Amenities; Leaving Rent Control

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If reading The Hunt stokes your deepest hopes that someday everything in life could work out, then you, too, are obsessed with the New York Times Sunday Real Estate section. Join us as we venture into the depths of this weekend's installment, figuring out along the way what the subtext of each story tells us about the state of the NYC real estate market using our bona fide Market Point system.

1.) The Times put it's spotlight on Condos with Hotel amenities, noting their somewhat precarious timing giving the economic climate. However, it seems like the developers are confident in their success, with some boasting encouraging sales numbers. And of course, we can't talk about Hotel amenities without mentioning Trump SoHo!

-For developers from Hoboken to Harlem, Williamsburg to SoHo, a condominium with a hotel attached is one more weapon in the reignited amenities arms race. -The developers of condo-hotels plan to charge as much as 20 percent more per square foot than high-end competitors that don’t have hotel partners.

-Hotel occupancy has been steadily increasing in recent months, with 89 percent occupancy in August and an average room rate of $227, according to NYC & Company, the city’s official marketing, tourism and partnership organization.
But that is far from the more than the $300 a night commanded by hotels before the economy faltered. There is also more competition now. In 2010, 21 hotels have opened, or will, across the city; that adds more than 6,700 rooms.

-Prices for units in condo-hotels range from $300,000 to more than $18 million — $680 per square foot to nearly $4,000 — with yet more properties in the pipeline.

-The newer condo-hotels are not to be confused with condotel projects like the 1997 Trump International Hotel and Tower. A condotel customarily allows its condo owners to rent out their units as income-producing hotel rooms, an arrangement that often attracted investors.

-But with banks now wary of lending to buyers of investment properties, some real estate analysts and brokers have declared the condotel dead, although the developers of the Trump SoHo on Spring Street and Varick would disagree. The condos of the condo-hotel combinations are being marketed to buyers as homes to be lived in and the hotel amenities that come with them as lifestyle.

-The condo-hotel concept is also coming to Harlem, with the opening of Apex at the Starwood Aloft Hotel at 2300 Frederick Douglass Boulevard, at the corner of 124th Street. The 44 Apex condos, above the 124 hotel rooms, range from 476-square-foot studios, for $300,000, to 1,767 square-foot three bedrooms for just over $1 million — an average of $600 per square foot. Sales are expected to begin next week.

-Developers have been encouraged by the sales at the W Hoboken. Since the condo-hotel opened in 2009, 38 of the 40 condos have sold, with prices ranging from just under $1 million to $2.5 million, records for the neighborhood, according to Michael Barry, the developer and owner of the property through his company, Ironstate.

-THE Trump SoHo stands apart from the current crop of condo-hotels because it more closely adheres to the “condotel” model.

- “Over the past three months, we have closed on 23 units, with gross sales of $30 million, averaging $10 million in closings a month,” Mr. Nino said. “The average price per square foot is $2,516.”
The amenities include an 11,000-square-foot spa with a hammam, an outdoor pool and a nightclub where owners are waved through the velvet ropes.

2.) The Hunt this week taught us that cheaper is not always better. Gary Parker knows this well, having paid just $714 a-month for a one bedroom in South Slope, but knowing he had to move on. His journey led him through the depths of Brooklyn (with a small stop in New Jersey) and into the place he "knew" was home.

-HOW could he possibly relinquish the lease on a $714 rent-stabilized one-bedroom? Everyone told Gary Parker he was crazy. -But he was living with cracked ceilings, squeaky floorboards and leaky faucets. The toilet ran until the handle was jiggled. The view was of the building across the street. Sunlight was weak. “Every plant I ever bought in that apartment died,” he said.

-A year ago, with a budget of around $300,000, Mr. Parker began searching for a one-bedroom with a view — “something captivating that I could really take in and enjoy,” he said.

-They went to see a co-op in Sunset Park, Brooklyn, with two small bedrooms, a large kitchen and a view of the Manhattan skyline. It was listed at $299,000, with a maintenance fee of $300 a month.

-“On paper, this could be the place,” Mr. Parker said. But the layout was odd, and the apartment was in bad shape. A friend told him he would be depressed there, “because it is basically your apartment now — with a view.” He realized he wanted a place in move-in condition.

-Back in Brooklyn, he checked out a new condominium in Gowanus, listed at $379,000 with monthly charges under $250. It was lovely, but there wasn’t much of a view. And he was leery of the high closing costs that typically come with new construction.

-Last spring, two possibilities appeared in co-ops on Ocean Parkway in Kensington, Brooklyn. One was in a nice prewar building with a view of the Verrazano-Narrows Bridge. The view, however, was seasonal — obscured when the trees were in leaf. The listing price was $279,000, with maintenance of $540.

-At the other co-op, a 1961 white-brick building a few blocks away, he had a visceral reaction. “I knew I was home,” he said. “I had been to so many places, but I’d never experienced that.”

-Three boroughs — Manhattan, Brooklyn and Staten Island — were visible, with the view punctuated by the Verrazano. The apartment, large and in very good shape, came with an off-street parking spot. The asking price was $289,000, with a maintenance fee just under $600.

-Mr. Parker negotiated the price to $277,500.

And there you have it, another weekend spent with the Times. The Condos with Hotel amenities are somewhat of a strange presence nowadays, but some of them actually seem to be doing fine allowing a slight +1 gain for the market in our humble opinion. It's hard for The Hunt to be disheartening by the end of it and this one was no different, so we shall bestow a ripe +2 MP's at the closing of this week.

·When a Building Looks Like a Condo, But Acts Like a Hotel
·Because Dirt Cheap Has It's Downsides