Developers Are Coming Back To NYC Post-Recession, What Does This Mean For The Housing Market In 2013?
iRealty TimesAugust 11, 2012When the Lehman Brothers fell in September of 2008, it triggered a domino chain of events that led to the recession. Many property developers who were in the midst of ambitious projects during that fall decided to put their plans on hold, waiting, wishing, hoping, for the day when things would get better.
Well, the New York Times reports that several of these developers have come out and begun to proceed on their once-stalled projects. Could this be a sign of things to come?
Michael Stern, a New York developer, told the Times he plans to start converting the 1929 Walker Tower in Chelsea into condos, just as he originally planned in 2008 but had to stop when, according to him, the day he bought the building coincided with "the day the world fell apart."
New buildings in downtown Manhattan are moving forward in bulk, such as One Madison Park and 56 Leonard. Other projects are surging into market constrained by low inventory, rising prices, and seemingly eager buyers in Russian billionaires and Las Vegas casino magnates.
"It is a very powerful moment in new development right now," said Kelly Mack, president of the Corcoran Sunshine Marketing Group. "Developers are seeing a very strong opening in the market to really push their projects forward. These two years were really worth the wait."
In the Manhattan market, contracts are up 26 percent from the second quarter of 2010, while new development inventory is down 58 percent over the same period.
That means there will soon be more demand than supply.
Some developers are playing it safer and waiting out longer.
Larry Silverstein, the developer of the World Trade Center complex, told the Times he hopes construction can start next year on a Four Seasons Hotel project located at 99 Church Street. It will be topped by some 50 floors of condos. His strategy is to start selling the 143 condos by the middle of 2015, when the World Trade Center will largely be completed.
This plan was originally conceived to take place in 2008.
Judging by previous reports of Manhattan developing the west side and lack of available property for tenants, the market looks to be on the way up.