In spring 2012, I received a call from an international buyer interested in acquiring an entire building in prime Manhattan. The customer had a budget of $25M and was ready to buy sight unseen as he was unable to come to New York for some time, so he really needed an agent to help guide him. He also made it clear that he wanted a great deal and was intent on negotiating.
I shared with him a number of properties that met his criteria, but he quickly found that it was challenging to get what he wanted between price, building size, or the desired neighborhood. Similarly to what most NYC buyers experience in the search process, he realized that he was going to have to compromise.
In an attempt to think “outside the box,” I decided to look in emerging areas and found him a great deal uptown in East Harlem, an area that he had never considered before. This particular site would allow him to build a new building from the ground up, and the price was so attractive that it made economic sense for him. But my customer ruled it out immediately, saying that the price was too much to pay for the area.
Back to the drawing board, we continued the search for another two months. I made offers on several other, bigger and more expansive buildings on his behalf. But the market gradually picked up while we were searching and his aggressive bidding strategy resulted in all of his offers being turned down.
Increasingly disappointed, my customer was on the verge of giving up on his quest to buy in NYC. Then he asked about that property that I had previously recommended in East Harlem. Again, he voiced his concern that he didn’t know the area, he didn’t understand the basis for the value, and – although he does develop abroad – he felt it would be difficult for him to develop in New York.
I decided to introduce the area to him in a creative, objective way. I took a video camera and interviewed locals, business owners, and doormen throughout the neighborhood, asking about the neighborhood’s past and present and plans for future development. I learned about a huge art complex that would be built across the street from the location. I took footage of the dozens of new developments that were underway in the nearby vicinity. I shared the video and the sales data of these projects with my customer to illustrate to him on the pace of growth and escalation in property values that was underway. I also educated him about the development process in NYC, including realistic construction costs.
After looking at all this information, he saw the full picture and agreed that the deal made sense.
I immediately reached out to the listing broker to present an offer only to learn that the listing was already in contract! Frustrated, my customer urged me to get the deal done. So I communicated with the broker every day, emphasizing my client’s qualifications, and secured a back-up position for him. After two weeks of persistent negotiating, I finally convinced the listing broker to give his offer primary consideration. She told me that if my buyer came in at the asking price and agreed to pay cash, then the deal was his.
I spoke to my customer and he agreed to pay cash and very close to the asking price, and then promptly flew to NY to sign the contracts.
Only then, after almost six months, did my client and I finally meet in person. I took him on a tour of the area where he saw the actual property. He was thrilled with the purchase. Now, a few months later, he realizes that what then seemed expensive has already gained in value.