Personal thoughts from within the Luxury Real Estate network
Courtesy of: Frederick Peters, President, Warburg Realty
2009 charted a unique, decade-defining trajectory through the world of New York real estate. It began deep in the doldrums, with mounting inventories and sinking prices, and ended 180 degrees away, with diminishing inventory stabilizing prices. And it was quite a wild ride in between!
As the year began the economic news was dire. Prices were falling and throughout the fourth quarter of 2008 there were few active buyers. With the financial system seemingly dysfunctional and a new President waiting to take office, everyone held their breath. Government funds, though injected in vast quantities into the banks, neither eased credit nor allayed public anxiety. And so, as real estate brokers, we waited. Buyers were sure the market had further to fall and many offered 30% or 40% below asking price; sellers couldn’t quite believe that they had missed their moment and were not ready to accept the new reality.
At many new developments, buyers threatened to walk away from their deposits on properties contracted at the height of the market but now being paid for after slippage of up to 25% in value. Some actually abandoned deposits of 20%, but most others, saber rattling exhausted and maybe a few developer concessions thrown in, closed on schedule. Otherwise, it was the smaller apartments which held their value the best during the first months of the year. And the top of the market, the ultra luxury, $10,000,000-and-up properties, went begging. No one wanted them. They just sat, prices creeping down, as the months went by.
Typically, as the sales market slows the rental market accelerates; people, the reasoning goes, have to live SOMEWHERE. In 2009, apparently they did not. A weak rental market meant that vacancy rates were high, owners paid commissions, and rents were negotiable. Tenants mostly steered clear of co-ops, with their time consuming Board packages, since all the new condo buildings were full of both newly purchased and unsold units, choc-a-bloc with amenities and completely new, available for rent at attractive prices.
Throughout the sales market there was a bit of reinvigoration in late February, which was quickly quashed as the stock market nosed to its bottom in early March. And then, gradually, as spring began, a confluence of forces brought sales activity haltingly to life.
Most importantly, sellers began to acknowledge the new realities and negotiate accordingly. Prices swerved more into line with buyer expectations. Some great deals were achieved by buyers willing, to paraphrase Warren Buffett, to buy when people were nervous. April and May provided real opportunity for buyers – they bought at prices anywhere from 15% to 40% off comparable values from a year earlier, depending on the size, location, and condition of the property (the biggest discounts were seen in large properties needing renovation.) And as June rolled around, one began to hear murmurings from buyers that they did not want to “miss the bottom.” As brokers, it is always our duty to inform buyers to try to buy value and not await “the bottom” since that phenomenon is only visible in retrospect. The months between March and May clearly represented a bottom for our market, which then, laboriously, began to stabilize.
Loans, though cheap, remained (and remain) difficult to get. And the credit of the buyer was not the only issue. For the first time, banks began to hyper-scrutinize the balance sheets of the co-ops and condos in which they were lending. Was there a 10% line item in the building annual budget for capital repairs? If not, no loan! Did the building carry adequate insurance? If not, no loan! Had the market for this type of property remained stable since the original appraisal? If not, a new appraisal was ordered a week before the closing and if it came in lower, then the amount of the commitment sank proportionately. Behaviors like these left many buyers with no loan, or a smaller loan than they had been promised, just days before the closing was scheduled to occur. And buyers with mortgage contingencies in their contracts were horrified to discover that the language was fuzzy: sellers and their attorneys were arguing that once a commitment was received, the contingency was satisfied, and if the bank then withdrew the commitment, or lowered the amount of financing it was willing to provide, that was the buyer’s risk. This has led to more than one litigation during 2009 and the issue has yet to be resolved. In the meantime, the financing language in the standard form contract needs tightening!
During the summer, the pace of transactions continued, gradually, to increase and by fall we found ourselves in a fairly active marketplace. Not only were current buyers increasingly fearful that the bottom was receding, but a whole additional group of buyers, priced out of the market in recent years, came hurrying back to seize their opportunity to purchase at lower and more stable prices. For the first time in a decade lawyers and doctors led the list of professions in our buyer mix, with finance dropping to third place. And Boards, increasingly skeptical of bonus money or restricted stock and options in institutions they no longer saw as ironclad, welcomed these steady income professionals with open arms.
As the year drew to a close inventory across the board was at far lower levels than in January. In particular, resale inventory, especially properties under $6,000,000 in the older buildings, has fallen to a point where competitive bidding, in a more orderly and moderate fashion than heretofore, has once again become common. While the $10,000,000 and up market remains very slow, prices otherwise seem stable, with a slight upward trend; no-one expects major gains in 2010 but a 3% to 5% increase in value seems realistic and sustainable. And while transaction volume overall for 2009 was substantially below that of the two preceding years, as were prices, we in the brokerage business in New York, with contained supply and value conscious but steady demand, have much to be grateful for as the second decade of this new millennium begins.
For up to the minute information, please visit the Warburg Blog.
Courtesy of: Peter Linsey of Summit Sotheby's International Realty
By: Andrew Kirk, of the Park Record
Management calls it one of the most 'grand' of the luxury brand
One of the most anticipated moments of the winter occurred Friday morning when the ribbon was cut on the St. Regis Deer Crest hotel ushering in a new era in which Park City is expected to have a higher profile and greater exposure among the most wealthy vacationers from the Northeast.
Michael Zaccaro, managing partner of the ownership group Deer Crest Janna, said the vision for an internationally-recognized, five-star-brand hotel was inspired by the site itself.
Perched above and to the east of the base of Deer Valley Resort, the site is adjacent to one of the ski runs in the private community of Deer Crest. From below the site can only be seen from a particular angle near the south tip of Jordanelle Reservoir.
With ski-in, ski-out access, incredible views of the Wasatch Back, situated in one of Park City's most upscale communities adjacent to a resort repeatedly voted No. 1 in America by affluent skiers, something like a St. Regis was the only thing deserving of the site, Zaccaro explained Thursday. The ownership group in conjunction with the developers, Stan Castleton and DDRM, chose Starwood Hotels' St. Regis brand because of the large and loyal following it has among elite travelers especially those in the Northeast.
General Manager Michael Hatzfeld said St. Regis is excited to be in Park City because being at the best addresses in the best destinations is core to its values. Deer Crest and Deer Valley is one of those addresses and Park City is one of those destinations.The St. Regis in Aspen, Colo. has been "an iconic ski destination" for the company, but it isn't ski-in, ski-out. Furthermore, the summer activities in Park City are superior to those in Aspen, he said."It's not just a focus on the three or four months of ski season, but the summer months can bring Fortune 500 companies to these destinations," he said.
So as not to overload Deer Crest with traffic, most guests and visitors are brought to the hotel by a funicular starting near the Deer Valley parking lot. A gondola just wouldn't have done, Zaccaro said. The smooth, roomy and unique experience the funicular ride provides is the perfect introduction to the hotel. It was a focal point in the planning process, he said. "It's not that much different than an elevator but far more spectacular," he said. It is the first commercial funicular in the United States, holds 15 people plus luggage and is a 90 second ride that is touted as energy efficient. The views are expansive as well. "Nothing else has the same impact," he said.
Zaccaro said the condominium-hotel industry was "given a black eye" by the start of the recession, but said the financial structure of the hotel is incredibly sound. The committed buyers are closing at a rate that has soothed fears, he explained. At the ribbon cutting, Hatzfeld and Starwood senior vice president of operations Carla Murray both said they had been general managers at the Aspen location and both agreed St. Regis Deer Crest was "a little grander." "This is by far the most spectacular and interesting (St. Regis) I've had the privilege to run in my career," Hatzfeld said. "Count on us," Murray said during her remarks. "We plan to be an active member of this community." Lt. Gov. Greg Bell addressed the crowd at Friday's ceremony and said he considered the hotel to be one of the country's most amazing structures. Conceptually, legally, financially and structurally it is a "remarkable" feat, he said, and called its completion despite the recession "miraculous."
As the hotel and its three competitors (Dakota Mountain Lodge, Stein Eriksen Lodge and The Montage) create more world-class amenities it will garner greater world-wide recognition, Zaccaro said adding, all four hotels are "looking forward to working with each other."
Courtesy of: Shawn Clayton of Clayton & Clayton Realtors
Sandy beaches with miles of Ocean........
A Rare Opportunity! To own one of Mantoloking’s Private Beach Front Properties.
A time to embrace and build the ideal Ocean Front Home, while enjoying refreshing ocean breezes, and sparkling waters. This enclave preserves the quiet serenity of unspoiled beaches surrounded by prestigious Ocean Front Homes. This truly is a prime location! Shawn Clayton of Clayton & Clayton Realtors is offering this property for $3,950.00.
Clayton & Clayton Realtors is a full-service Real Estate Company serving both Ocean and Monmouth Counties. A tradition of being the broker of choice, of Luxury Homes & Fine Waterfront Properties, Clayton & Clayton has remained family owned Real Estate Firm for nearly 80 years. Kindly, call Shawn Clayton at 732 295-2222, 512 Main Avenue, Bay Head, New Jersey, 08742 or Kindly visit our website at www.claytonandclayton.com
November 16, 2009, (Splash News) - The on-screen family home of Twilight vampire Edward Cullen is up for sale in real life for a cool $3.3m.
The stunning three-floor Vancouver pad is home to Twilight hunk Robert Pattinson's bloodsucking Cullen clan in New Moon, the latest installment in the hit vampire saga.
The house is the setting for a pivotal scene in the new film, when Cullen's adopted brother Jasper tries to attack Bella Swan (played by Kristen Stewart).
But now that filming of the third Twilight movie, Eclipse, has recently been completed, the house has been put on the market, priced at $3,298,000.
Real estate agent Jason Soprovich, who is handling the sale, describes the luxury five-bedroom property as "the Cullen House, as seen in the recent world-wide hit saga Twilight: New Moon".
It is understood that the house will not be used as a filming location for future Twilight movies.
Courtesy of: Paula Maia of O & O Property Collections
Located on the shores of the Atlantic Ocean, with year round peerless light condition, and only 5 ½ hours from New York city, the Algarve is about to become the Hollywood of Europe.
Portugal offers a very favorable high quality/ low cost of living ratio; which added to the fact that it has topography of 40 states of America combined and yet is roughly the size of New Jersey, makes of this project every producer’s dream.
The Holding Picture Portugal is the newest addition to international cinema, commercials, video games, music videos, and audiovisual production centers. This ambitious project has been developed by the Portimão municipality and the renowned international Portuguese actor Joaquim de Almeida, and comprises the creation of 11 super modern new studios fitted out with state-of-the-art equipment.
The prevision is for two of the studios to be up and running by the end of 2010, and wheels have been set in motion for various film projects. Amongst the feature films already planned are: - “Femina” with the renowned Italian actress Sophia Loren as the leading actress, -“Mendes”, a film based on the life of a Portuguese consul who saved more Jews than Oskar Schindler during the Holocaust. The consul role will be played by Richard Gere. - Remake of “Le Mans” which have Brad Pitt, Penelope Cruz and Al Pacino in the leading roles,.
During the first phase, the plan is also to construct post-production areas for audio and video, an area for shooting outdoor scenes and a «water tank» - a specially adapted pool for underwater filming.
The cinema studios complex will include a media park as well as a fun park for the entire family, and the central theme will be “the history of cinema and the world of cars”.
Negotiations have been taking place with CBS Paramount and Universal for the film studios, and Lynn Ferro, vice-president of CBS, has been one of the main supporters of this striving project.
Courtesy of: Daniel Gale Sotheby's International Real Estate and RisMedia
RISMEDIA, November 12, 2009—James P. Retz, senior vice president, Marketing and Technology for Daniel Gale Sotheby’s International Realty, one of the nation’s leading Realtors, will be a panelist later this month on the award-winning television program “Exploring Critical Issues.”
“The Real State of Long Island Real Estate” is the topic of the upcoming program, hosted by Adelphi University President Dr. Robert A. Scott. In its sixth year of production, the hour-long program features a roundtable of distinguished guests that explore a topic of significance to metro-area viewers.
“The Real State of Real Estate” provides viewpoints on the current real estate market as influenced by factors in construction, architecture, commercial and residential real estate.
“There have been so many changes to both the commercial and residential real estate markets, it is important to be able to look at the big picture,” said Retz. “The Internet, in particular, has revolutionized the home buying process. But much has stayed the same. We all still need a place to live, and the emotional and financial implications of buying and selling a home call for the expertise of an experienced real estate agent.”
In addition to Jim Retz, panelists include Ted Sasso, President, Renaissance Realty Services, LLC; Mitchell Rechler, Rechler Equity Partners and President of ABLI (Association for a Better Long Island) and John Tsunis, Chairman, Gold Coast Bank, Chairman and CEO, Long Island Hotels, LLC, and land use attorney at Tsunis, Gasparis, and Lustig, LLC.
For more information, visit www.danielgale.com.
RISMedia welcomes your questions and comments. Send your e-mail to: realestatemagazinefeedback@rismedia.com.
Courtesy of: Fannie Hillman & Associates
A comprehensive mid-year 2009 report for the condo and housing markets in the following five areas of Florida is now available:
In the report, you will find information about housing trends in the categories of average sale price, average price per square foot, median sale price and median price per square foot.
To view the report, click here!
By Carina Sousa of IRG International Realty Group
IRG International Realty Group, the exclusive affiliate of Christie’s Great Estates in Portugal is selected to be the exclusive agent for the marketing and sales of the prestigious resort Madeira Palace Residences. In 2005 the Fibeira Group, owned by Engº Armando Martins bought the prestigious Madeira Palácio Hotel together with the project for Madeira Palace Residences. Designed by Ricardo Bofill Associated with Atelier Caires – João Francisco Caires e Associados, the Madeira Palace Residences are a striking example of the best in contemporary architecture and quality living.
With 100 homes ranging from one bedroom to four bedroom apartments, all with garage parking and storage, the development benefits from spectacular views over the Atlantic.
Constructed around an interior garden, where exotic water features play an integral role, the development has been designed to provide a restful and elegant environment and will be forecasted to be ready in the summer of 2010.
A serene and private haven, Madeira Palace Residences represents the best in luxury living. Residents will have access to the services of the adjacent five star renovated Madeira Palácio Hotel including spa, restaurants, room service, laundry and cleaning, and membership of the Beach Club.
The Hotel Madeira Palácio Hotel has a very rich history. It opened its doors in 1971 and was operated by Hilton Hotels between 1971 and 1973 owned by Robert Jabara Pereira Ganhão (Pastelaria Suiça), TAP and Hotel Palácio in Estoril.
In 1982 the hotel was bought by the Albaker Group that owned the Marriott (formerly known as Penta), Eden Hotel, Hotel do Mar and Hotel Palácio Estoril.
The renovation of the hotel has been designed by WATG associated with Atelier Caires – João Francisco Caires e Associados – Projectos de Arquitecture Lda.
An extensive program has been implemented to give the Madeira Palácio Hotel a five star luxury rating according to international demand including a sophisticated interior design for the rooms and public areas.
About IRG International Realty Group
IRG International Realty Group is one of the leading international brokerage companies in Portugal and specializes in sales of Portuguese high-end and luxury residential real estate. IRG is the exclusive affiliate in Portugal of Christie’s Great Estates, a worldwide real estate network and subsidiary of the world’s oldest auction house, Christie’s. IRG’s Head Office is located in the prestigious Avenida da Liberdade in the heart of Lisbon and there are also boutique offices in Quinta do Lago in the Algarve, Estoril and in Kensington, London, United Kingdom. www.irgportugal.com
About FIBEIRA SGPS, S.A.
FIBEIRA SGPS, S.A. is a managing group of social investments. Its strategically cores are present in the realm of Real Estate Development, Hotel Management, Services and
Media/Press, a wide variety of business activity sectors. In a Group that established itself in 1984 with the creation of FIBEIRA, the ability to expand and respond efficiently to all the new challenges was the key point for the current confident broadening of its interests into new business domains and lead to a solid presence in markets like the hotel industry.
Success and innovation have been a constant reward for the evolution of our companies which allowed them to work in different business areas with levels of performance much higher than the ones present at their creation. www.fibeira.pt
Courtesy of: Steve Catsman of Telluride Real Estate
We thought you might be interested in some photos demonstrating the current status of the Telluride Regional Airport improvement project. Currently Phase II of a 3 part project is under way at the cost of approximately $21 million. This phase will upgrade the safety designation from B3 to a D3 designation. This is being accomplished with the addition of 250 feet of safety over run on either side of the centerline rather than the current 150 feet.
Additionally at either end of the runway a product called Emas (engineered material arresting system) will be installed. This product is used at Laguardia Airport in New York and Midway in Chicago. This higher rating will allow larger aircraft such as the Q 400 to service the airport. This 75 passenger aircraft has the endurance to fly direct to Telluride from the west coast and Texas. The new designation will be in place once the last phase of construction is completed by summer/fall of 2010.
As seen on WWL-TV August, 24, 2009
Courtesy of Eleanor Farnsworth of Prudential Gardner
NEW ORLEANS – (AUGUST 28, 2009) - St. Charles Avenue in New Orleans has been described as the "Jewel of America's Grand Avenues." It's the finest collection of old south mansions in the country.
Travel down the tree lined street and its hard to miss so many architectural gems, now up for sale.
"You can look at the structure and see the detail," said realtor Eleanor Farnsworth. "It took five years to build, starting in 1903."
Farnsworth showed us around the home known by many as simply "The Castle." From the limestone exterior and magnificent gardens to the hardwood floors, handcrafted moldings and stain-glassed windows inside, this mansion is one of kind.
The home also comes with an $8 million price tag. The cost is expected to set an all time record for single-family homes in the city.
"It's an opportunity for someone to get a wonderful home that never comes available," said Farnsworth.
Gene Goldring and her husband just bought a home off of St. Charles in June.
"The architectural elements in these homes, you don't see them everywhere," said Goldring. "Walking around Uptown, everyday for us, I fall in love with the city all over again."
There are also mansions for sale in the Garden District.
The Coliseum Street home where the movie The Curious Case of Benjamin Button was filmed is now selling for about $2 million.
Actor Nicolas Cage is selling his house on Pyrtania Street for $3.4 million. Dorian Bennett has the listing.
"It's got all the whistles and bells," said Bennett. "It's got the yard, the garden, it's got the pool, it's got magnificent architectural details."
Bennett says if you're looking for luxury, now's the time to buy.
"It's been a while since I've seen so many for sale," said Bennett. "There are estates, divorces, there are different economic downturns and changes in people's lives that cause people to want to sell."
They say it's a buyers market, but you still have to have money.
We crunched the numbers: a $8 million dollar loan with a 30 year mortgage at 7 percent interest, the monthly payment would be $53,224.20.
Realtors say if you can afford one of these mansions, chances are you don't need a mortgage.
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