Manhattan Residential Development

[jennicak]

thx for the dialogue, help, quips, jokes, etc...

Look forward for 2008!

(ps, thx for the pete, thx for the info on jasper)

[infoshare]

Great architectural design: good-glass too..

http://chelsea-modern.com/

[lofter1]

A Hearing at LPC on January 22 for a revised version of this one at 8, 10, 12 Bond Street (at Lafayette) in NoHo...

(DOB Application for a NEW BUILDING on this site was Disapproved on 9.28.07 -- Architect: TRA Studio (> New Buildings > 8 Bond) Traboscia Roiatti Architects / Caterina Roiatti)

Another “contemporary” building for Bond Street in NoHo



21-MAR-06

Ignoring opposition from Community Board 2 and the Historic Districts Council, the Landmarks Preservation Commission approved with minor modifications an application for a certificate of appropriateness this morning for a new building in NoHo with an indented ground floor, a curved façade of perforated corrugated metal and another façade of hammered concrete.

The project in question is a 6-story residential condominium building at 8-12 Bond Street on the northwest corner at Lafayette Street.

CERTIFICATE OF APPROPRIATENESS

BOROUGH OF MANHATTAN
08-4663 - Block 530, lot 63,64
8,10,12 Bond Street, aka 358-364 Lafayette Street

NoHo Historic District

An altered factory building built circa 1920 and two one-story garages designed by Sapolsky & Slobodien and built in 1959.

Application is to amend the design of a previously approved seven-story building

Zoned M1-5B

[Front_Porch]

Great architectural design: good-glass too..

I took clients by to see the Chelsea Modern -- we saw some things at $2MM; everything under $2MM was gone -- about a month ago. It does truly look like a good building, and readers of this forum know I don't love every new condo that goes up.

I would urge potential buyers to walk around the neighborhood because I think that's a large part of what you're buying, the bohemia of West Chelsea, and it's not for everyone.

ali r.
{downtown broker}

[RandySavage]

Any renderings for 450 Washington Street. I walked by and think it is now in vertical construction.


http://www.lowermanhattan.info/const...eet_31439.aspx

[Front_Porch]

No renderings , but some good speculation on the North Tribeca Development thread : http://www.wirednewyork.com/forum/showthread.php?t=5360

I believe the project you're calling 450 Washington is the one referred to one that thread as 454 Washington, in my head it's just the "Jack Parker project."

ali r.
{downtown broker}

[lofter1]

Handel Architects show no plans for this project on their website.

The lot covers the full block and DOB designates it as 450 - 454 Washington.

[25Murray]

Just wanted to let everybody know that I still haven't closed on my Tribeca Space condo (nor has anyone else who bought into the building and was promised occupancy in Fall 2006). No word from Sponsor or Corcoran Marketing as to what the problem is or a projected move-in date. I should have rescinded my purchase contract when I was given the chance to do so by the Attorney General in September 2007. I feel like a real fool now. Do you think the Attorney General will force the Sponsor to grant another right of rescission???

[Peteynyc1]

Cover Story - January 2008The Golden Age
High-Rise Residential Construction Keeps Going
by Alex Padalka
New York and the tri-state area are now feeling the impact of the national subprime mortgage crunch and slowdown in new home construction and residential high-rise projects, but the boom here is far from over.
Unlike the rest of the country, New York continues to attract buyers and renters alike at ever-increasing prices.
"If you're a [New York] contractor and you're not busy now, you're doing something wrong," says Louis Colletti, president of the Building Trades Employers Association in New York City.
The region's builders are adapting to limited space, reclaiming waterfronts, building bolder designs and inventing new mixed-use strategies to diversify their investments, all while facing serious staffing shortages and materials costs that continue to soar.
Better, Smarter Designs
"In the 60s and 70s, design was done under the table," says Costas Kondylis, president of New York's Costas Kondylis and Partners. The focus for any developer-designer relationship used to be efficiency and construction costs. "Today, the major subjects of conversation are design issues."
Related Article: On the EdgeThe change is in large part due to the recent advent of European "starchitects." Manhattan has seen a new era of design since the assignment of Pritzker-prize winners like Italy’s Renzo Piano to the recently completed New York Times Tower, Britain’s Sir Norman Foster on the new Hearst building and Richard Rogers, also of Great Britain, on the new Javits Center.
Kondylis calls this competition "stimulating" and says it is in large part responsible for the current "golden years of architecture in Manhattan." His firm has designed the recently completed Platinum at 247 W. 46th St., a 42-story condo tower featuring a 26-ft-long fireplace in the lobby, for SJP Properties of Parsippany, N.J., and the Link, the 44-story tower at 310 W. 52nd St. that features a glass cube lighted at night at the main entrance and a landscaped terrace with a reflecting pool. The Link was designed for New York's Elad Properties.
"Over the last 10 years, there's been such a focus on costs that architects weren't allowed to be creative," Colletti says. "Bringing in these international architects allowed the domestic architects to think a little outside the box, and that strengthens New York's role as a world-class city."
Still Going Despite the Crunch

The residential market in New York City has effectively skirted the slowdown hitting the rest of the country. As a cosmopolitan city, New York "relates not so much to the U.S. economy but to the international economy," Kondylis says. Combined with the plummeting dollar, real estate in New York continues to attract investors with the stronger Euro and other currencies.
Meanwhile, the skyrocketing price of real estate, at least in Manhattan and Brooklyn, has resulted in another phenomenon: "residences selling for $1 million or more continue to sell more quickly than lower-priced products because purchasers in that price range are largely cash buyers and not as likely to be affected by the subprime mortgage situation," says Sara Mirski, managing director of development for Brooklyn's Boymelgreen Developers.
Extell Development is scheduled to complete late this year the 43-story, $260 million Rushmore at 80 Riverside Blvd. in Manhattan, where residences as large as 3,072-sq-ft will range between $1 million and $7 million.
Also finishing this year is the 57-story Sky House at 11 E. 29th St. in Manhattan, a luxury condo tower designed by FXFOWLE of New York for the Clarett Group, also of New York, with Bovis Lend Lease managing construction. Last year, Bovis completed construction on the 886,000-sq-ft 15 Central Park West for New York's Zeckendorf Development.
The Challenges: Materials and Labor
The continued growth has meant that the cost of materials has continued to skyrocket and trained-labor shortages are being felt by every contractor.
"The availability of foundation, concrete and curtain wall subs is limited," says Dennis Freed, senior vice president of New York's Bovis Lend Lease. "A lot of times you don't even get to bid out, you pick one of these guys and work with them."
Colletti adds that "the market is so strong across every market sector that your quality contractors are close to capacity and are having difficulty recruiting project management personnel. It's really a long-term challenge."
And Jay Badame, chief operational officer at New York's Tishman Construction Corp., says, "Along with the unions, we need to educate the new employees as the older talent leaves, and we need to continue to run safe projects because of the influx of new workers into the workforce." Developers, meanwhile, are seeing tighter and tighter profit margins, and some, such as Boymelgreen, are slowing down their investment in New York. Overall, there's a "disconnect between everyone's aspirations, including the owner, the architect, the marketing people and the consuming public," says Dan Kaplan, principal at FXFOWLE.
The biggest losers, however, may be the city's poorest residents. "The high cost of construction is unfortunately also having a negative impact on both the quality and the quantity of affordable housing development in the city," says Boymelgreen’s Mirski.
Furthermore, despite the groundbreaking designs, the level of craftsmanship in New York is still behind that of the top buildings in other international hotspots.
"The type of building systems and sophistication being installed in London, Shanghai, Dubai, Tokyo is superior to what is being put in place with residential buildings in New York, and we shouldn't settle for that," Kaplan says.
For example, Europeans are used to spending more money on better craftsmanship in anticipation of longer occupancy, Kaplan adds. Still, the New York market is poised to catch up, he says.
"The appetite is there, the will is there and everyone wants the sophistication level," Kaplan says. "The question is how we get there in this market."
More Cooperation
The key to better buildings is "more integration of design and construction," with organizations like the Building Congress and the American Institute of Architects as vehicles for this cooperation, Kaplan says. Architects are already being brought earlier onto the projects as the sites and owners’ demands become more complex.
Construction managers are also feeling the changes and coming in earlier. Bovis's Freed says higher-end finishes the consumer has come to expect demand a higher attention to detail and coordination with the designers and the trades.
In addition, the typical high-rise residential building today is becoming more sophisticated outside, where brick, for example is giving way to window and curtain walls.
"Curtain wall has a much longer lead time than masonry," Freed adds. “On some of these projects we are picking the contractors based on the price we want to get, and then we negotiate after the design is done. If we waited for the drawings, we'd never have the wall in time."
The Future is Mixed

With the slowing down in the market, cautious developers have started hedging their bets. Most recently, with tourism in New York reaching a peak and driving hotel room prices higher, the hotel-condo has become popular.
"For the amenities the hotel provides to the condo owners a piece of the sky you can take the most premium floors and sell them for $1,800 to $3,000 per sq ft," says Pat Di Filippo, executive vice president, New York Region, for Turner Construction.
Tishman Construction of New York is the construction manager on a 57-story, $300 million hotel/condo tower scheduled for completion in 2009 at 123 Washington St. near the World Trade Center site. Scheduled for completion early this year is Renaissance Square, which is being developed by Cappelli Enterprises and will feature two 44-story condo towers flanking a Ritz-Carlton hotel.
Meanwhile, almost every project going up in New York City now has elements of retail or community space on the lower floors.
"What's happening is that there are no good sites left, and institutions have sites and need money, so mixed used is what we're seeing," FXFOWLE’s Kaplan says.
He adds that any community that lies along the major commuter networks from Stamford to New Rochelle to New Brunswick is more likely to attract people looking for "urban" environments where work, play, shopping and entertainment are all rolled together into pedestrian-friendly spaces, with a big shift toward sustainability and energy efficiency.
The Future is Green
With the boom in luxury residential construction, marketing terms like "marble countertops" and "stainless steel appliances" have become standard. This, in turn, has led savvy developers in a new direction: going green.
"It is increasingly important to differentiate each new project in order to break through the market clutter and reach buyers,” Boymelgreen's Mirski says. She adds that her firm is focusing on green development.
"Regardless of apartment or condo, regardless of cost, all owners are still sensitive to sustainable design in construction," says Turner's Di Fillippo. He adds that current construction practices already allow buildings to attain LEED ratings at "little or no cost."
Leaving Manhattan
Pat Di Fillippo, executive vice president of Turner Construction of New York, says that while the condo market will continue to grow, Manhattan may be due for a correction. "Will the people in Manhattan wake up?,” he adds. “You can pay $2 million for a studio in Manhattan or get 3,000 sq ft somewhere else.
"Harlem is an untapped possibility, Queens has already shown that it's capable of residential construction and Brooklyn will continue. I'll be surprised if Staten Island doesn't catch up."
In Harlem, Bovis Lend Lease already started construction last spring on the $126 million Avalon Morningside Park for AvalonBay Communities. Twenty percent of the 296 units are reserved for affordable housing.
In Brooklyn, RAL companies of New York finished developing this fall the $150 million One Brooklyn Bridge Park, which boast 449 units as large as five bedrooms.
Boymelgreen is slated to complete this year two 12-story towers in Park Slope: the 68-unit Crest at Second Street and Fourth Avenue and the 113-unit NOVO Park Slope.
Forest City Ratner Cos.'s $4 billion Atlantic Yards project alone will bring 6,430 units spread across 15 high-rises in downtown Brooklyn, according to the latest plans.
In addition, Williamsburg's waterfront continues to change every day, with 28 new towers 20 to 40 stories high and a total of 10,800 new units expected to be completed by 2015.
Toll Brothers of Horsham, Pa., and L&M Equity of Larchmont, N.Y., have completed One Northside Piers, which features 180 units in a 29-story tower designed by FXFOWLE. Douglaston Development of Douglaston, N.Y., broke ground last year on the Edge, a 1-million-sq-ft complex with 1,400 residential units.
In the Longwood section of the Bronx, New York's Jackson Development Group and Arker Cos. of Woodmere, N.Y., finished developing a $26 million, 12-story rental tower with rents starting at $638, with 10% of the units slated for the formerly homeless.
High-rise residential is going up farther north as well. In New Rochelle, Turner has completed the 558-rental-unit Avalon on the Sound II. Turner is also working on Hudson Park North, a two-tower condo project in Yonkers that includes 12- and 14-story towers, for Stamford, Conn.-based Collins Enterprises. The project, schedule for completion December, will include a two-acre public waterfront.
Farther up in Connecticut, Cappelli Enterprise of Valhalla, N.Y., started construction in May on the $160 million Trump Parc Stamford, a 34-story condo designed by Costas Kondylis for a joint venture of the Trump Organization, Stamford's F.D. Rich Co. and Cappelli. Completion on the tower, which includes one- to three-bedroom apartments and duplexes, is slated for 2009.
Across the river from Manhattan, New Jersey's waterfront continues to attract those buyers seeking more space for a marginal trade-off in commuting times. Construction was slated to start late last year on the $415 million Trump Plaza Jersey City, which will feature two towers 55 stories high and include 862 units.
The same can be expected for other waterfront towns, from Hoboken, Weehawken and up to Fort Lee. Tishman is finishing construction on the first phase of North Beach at Asbury Park, a three-tower waterfront condo high-rise. Applied Development of Hoboken, N.J., is building the 850-unit Liberty Harbor in Hoboken.
Going Global
Some firms have used the growing success to diversify their work outside the tri-state area. Costas Kondylis, for example, now has, for the first time, 12 projects abroad.
"It's a beginning of a global architecture movement, and New York firms have a lot to offer abroad," Kondylis says.
The growth of high-rise residential construction in traditionally single-family-home areas of the outer boroughs may be indicative of a general paradigm shift all over the country. Even one of the country's top single-family builders, Pennsylvania-based Toll Brothers has gone into high-rise, mixed-use residential all around New York and New Jersey.

http://newyork.construction.com/feat...8/01_cover.asp

[cdc_angel]

Hey Guys! This property is now out to bid for general contractors. Due 2/25/8 @ 5pm. This is on its way to becoming condos if anyone was wondering. Later Dayz!

[cdc_angel]

I work for a construction firm so i get the goods

[jlahk464]

I was walking on 10th Avenue and noticed some construction at a site on the west side of the street between 48 and 49. Anyone know what's going on there? I've done some searching and can't seem to find a reference to it.

[brianac]

The 'Impossible Dream' of Rental Development

By MICHAEL STOLER
March 6, 2008


Heuichul Kim
'AFFORDABLE' Rentals Taconic Investment Partners is in partnership with the Related Cos. In the recently completed Caledonia at 450 W. 17th St. The property has 288 rental apartments plus 190 condominiums. Fifty-nine of the units are 'affordable' housing rental apartments, with rents ranging between $461 and $738 a month.

Real estate experts say the development of residential rental apartment buildings is grinding to a halt in New York City. Limited availability of financing, high land and construction costs, the elimination of the 421-a program, and limitations on tax exemption financing has led to conditions that make building unprofitable for developers, even as the demand for new rentals is greater than ever.

"Developing rentals is the impossible dream," the chairman of Douglaston Development, Jeffrey Levine, said. "The ongoing strength of the condominium market has absorbed land suitable for residential development. That, in concert with the virtual elimination of tax bond allocations, and the lack of liquidity in the capital market, has made it virtually impossible to create residential rental apartment buildings."

Nevertheless, Mr. Levine and other developers have rental buildings in various phases of construction around the five boroughs. His company is developing a 34-story rental apartment building at 316 Eleventh Ave. near 30th Street with a total of 368 apartments. The building is situated within the Special West Chelsea District, High Line Transfer Corridor and will have 4,000 square feet of retail space and 28,000 square feet of parking.

On the corner of Eighth Avenue and West 31st Street, Savanna Real Estate Fund I LP is planning to develop a residential rental building with 90 luxury rental units, retail space on the lower level and the ground and second floors, and corner frontage on Eighth Avenue and 31st Street.

The largest rental development in Lower Manhattan, the 74-story mixed-use tower at 8 Spruce St. near City Hall and the Brooklyn Bridge, is being developed by Forest City Ratner Cos. The project, designed by architect Frank Gehry, would have about 850 rental units, with rents projected at about $85 a square foot.

"There is no question that we have a shortage in rental housing, yet it has become increasingly difficult, if not cost-prohibitive, to add quality housing stock to our already depleted supply," the chairman of national real estate practice at Greenberg Traurig, Robert Ivanhoe, said. "Though the real estate market has taken a respite from its 10-year boom, prices for land have not softened appreciably."

He continued: "Add to that ever-increasing construction costs, the prospect of even higher prices for raw materials and the weak dollar, the expiration of the 421-a program later this year in Manhattan, lack of availability of 80/20 tax exempt low floater bonds to finance large rental projects, and the credit crunch, prospects for new rental projects in Manhattan seems rather bleak, particularly after completion of those projects that were commenced prior to the expiration of the 421-a program. The result of this confluence of events in a supply-constrained market will be to drive up rental rates even higher. It will take a change in the underlying fundamentals of the production of rental housing or governmental action of some sort to create the incentive for developers to produce financially viable multifamily rental housing in Manhattan or in the boroughs." The chairman of the Brody Group, Eric Brody, said it is "nearly impossible to make a residential rental deal make sense unless you purchased the land a number of years ago. There is only one way that I am seeing that rental projects make sense. They are mixed-use projects with retail and residential rental. Strictly residential rental projects are close to impossible, but if you can incorporate retail into the project, you have a shot of getting the deal done. It's still a long shot but retail income can cover a lot of debt."

In the meatpacking district, a joint venture of Taconic Investment Partners and the Related Cos. is building a hybrid of condominium, market-rent, and "affordable" rental apartments. The co-founder and principal at Taconic Investment Partners, Charles Bendit, said it has become "increasingly difficult to build rentals in the boroughs without government subsidies, due in large part of the cost of building. A new building will cost between $300 to $500 per square foot for hard and soft costs, with the low end of the price range being low-rise wood frame or block and plank construction. This does not include the cost of the land. After a loss factor for common areas, the cost per net rentable square foot is between $350 and $600 per square foot. Rent for a property in the boroughs range from as low as a gross rental of $20 per square foot to a high range of $45 per square foot. With the high costs of operating a rental building, one can see that building a rental building is not justifiable."

Mr. Bendit added: "In Manhattan, where rents can be as high as $75 to $90 per square foot, one could justify building rentals, except the fact that land costs won't allow for rental property development. Our company is in partnership with the Related Companies in the recently completed Caledonia on Tenth Avenue and 16th Street, where we have 288 rental apartments plus 190 condominiums. The condominiums were all sold within a short period of time and the rentals are just coming to the market. The market is very strong for the rentals, and it would not surprise us to see market rents will be in the range of $85 to $90 per square foot. What enabled us to build rentals, however, was an historic land basis. Today it is more difficult to justify building a rental, including land is in excess of $1,000 per square foot, which makes it economically unfeasible to develop a rental."

Individuals have until March 15 to submit an application to qualify for one of the 59 "affordable" housing rental apartments that are under construction in the Caledonia. Apartments range in size from studio to two bedrooms, with rent ranging between $461 and $738 a month.

"A survey of the core Manhattan housing market indicates over 20,000 housing units from about 90 sites are scheduled to enter the market over the next three years," the president of Metropolitan Valuation, Steven Schleider, said. "Of the scheduled housing units, the split between rental and condominium units is relatively even. The largest concentration of new development is focused in Lower Manhattan and Midtown West. Within Lower Manhattan, almost 60% of the proposed new units are slated to be condominium apartments, with large-scale development scheduled for Battery Park City."

Mr. Schleider added: "In Midtown West, recent zoning changes in the Hudson Yards area has prompted a large number of residential development plans, with the majority focused on rental development. Of the 6,645 units planned, over 80% are scheduled for rental development, with Silverstein's River Place II representing the largest scheduled development at 1,359 apartments, of which approximately 20% will be set aside for low-income households.

"Pricing pressure on well-located, full-service rental buildings in top condition is maintaining annualized rentals in excess of $70 per square foot, with some leases piercing well into the $80s per square foot," he said.

The senior managing director at Rose Associates, James Hedden, said the good news is "that the residential rental market in all five boroughs is strong with low vacancies and healthy rents. This really is a testament to the healthy New York City economy, and the successful economic policies of the city and state. Unfortunately, as a result of this vibrancy, the cost of land, coupled with increasing construction costs, has made it extremely challenging to provide rental housing."

At least 4,000 rental apartments are in various stages of planning and construction in downtown Brooklyn. Developers include Avalon Bay Communities, the Clarett Group, Stahl Real Estate, and developer John Catsimatidis.

A joint venture of Rose Associates and MacFarlane Partners is planning the residential component of the new 65-story building with a total of 916 rental apartments on the former site of the Albee Square Mall. The development, known as CityPoint, is a joint venture of Acadia Realty Trust and PA Associates, which plans to build 500,000 square feet of retail, with enclosed parking, and 125,000 square feet of office space on the lower floors. This project would be the largest new development in Brooklyn in more than a decade.

A managing director at Prudential Douglas Elliman, Andrew Gerringer, said he believes "that we will be seeing more rentals coming on line that were originally planned as condominiums. I know of a 300,000 square foot building in Long Island City that was planning to go condominium; then the lender said they would only lend if it was built as a hybrid rental with a condominium component. Now they changed their mind again and will only lend if it makes sense as a full residential rental. This is a scenario that I believe we will be seeing a lot more of going forward for some time."

The principal of W Financial, Gregg Winter, said that in most cases, "rentals can only be built where land has been held by the developer for years, or in other cases land held for decades for another business purpose, like a parking lot or garage, is developed by the longtime owner, often with a joint venture partner who is a professional developer. If that same parcel were to be sold at market rate, the economics would be unlikely to work as a rental. The sunset of the 421-a program strikes an additional, possibly fatal, blow to the economic viability of developing residential rentals or mixed-use projects in New York City."

"High rental rates and low vacancies, high demand have made it very attractive to developers to plan and build residential rentals," the president of Citi Habitats, Gary Malin, said. "Average rents increased 10.4% from 2005 to 2006 and 5.5% from 2006 to 2007. Vacancy rates for Manhattan averaged at or below 1% for 2007, primarily due to the lack of rental inventory."

Mr. Malin continued: "Given the current credit situation, it is uncertain how many additional rental developments will come to market, but clearly, since New York is a renter-centric city, rental investments should continue to perform in the face of economic uncertainty."

A principal at Rock a Bill Advisors, Tim Henzy, said: "One of the major obstacles to the development of rental housing in Manhattan and more importantly the outer boroughs is the cost of construction. Contractors are used to being paid to build condominiums, particularly high-end; they are therefore not in the mode to bid or build rentals.

"Lenders are highly apprehensive to take on market rental deals in the boroughs until the condo market shakes out. In many instances certain unsold condominium units will become rentals," he said.

A principal at Singer and Bassuk Organization, Scott Singer, said the supply of construction financing available in the market "has been reduced by two main factors, the second being the more significant: First, a few lenders have pulled out of the market entirely, and second, virtually every lender has reduced the maximum loan size exposure they are willing to take on any one transaction."

Mr. Singer added: "However, among the remaining construction loan liquidity in the market, I would expect virtually every lender to say that rental apartments in New York City would be at the very top of their list of preferred projects. The developers who will be able to exploit this dynamic to their greatest advantage are some of the major families who have former garages, parking lots, and industrial facilities that are or can be zoned for residential — where their land cost is effectively zero and therefore the economics of rental development feel attractive. Furthermore, construction lenders will still give these long-term holders credit for the equity value in their land, allowing them to finance 100% of the new development costs with low-cost first mortgage financing in some cases."


Even in these troubling credit-crunch times, expect that established developers of residential buildings will be resourceful in continuing the development of rental buildings to meet the housing needs of the thousands of individuals flocking to reside in New York City.

Mr. Stoler, a contributing editor to The New York Sun, is a television and radio broadcaster and a senior principal at a real estate investment fund. He can be reached at mstoler@newyorkrealestatetv.com.

Copyright 2008 The New York Sun.

[brianac]

Buyers Wait To Saddle Up Converted Stable in SoHo

By BRADLEY HOPE
Staff Reporter of the Sun
March 13, 2008

Konrad Fiedler
11 Spring St. When they bought the former stable, developers celebrated with an art exhibit that highlighted the graffiti-covered walls and facade.

When a pair of Florida developers in 2006 acquired a 19th-century stable and carriage house in SoHo, they celebrated with great fanfare, even hosting a week-long art exhibit featuring the graffiti that covered the facade and inside walls.

The developers, Caroline Cummings and William Elias, spent $12 million to buy the building at 11 Spring St., which had long been vacant, from a former publisher of the New York Post, Lachlan Murdoch. They then invested $10 million to convert it into three high-end apartments, the costliest being a $17.95 million triplex penthouse with a private elevator.

Now, after nearly nine months on the market, the developers have yet to sell anything.

"Of course they haven't sold," the broker who represented Mr. Murdoch, Larry Michaels, said. "Even if you retrofit it with the biggest bling, it's still a five-story brownstone in Little Italy. … They aren't going to sell at those crazy prices."

Mr. Murdoch originally bought the building for $5.25 million in 2003, he said.

In addition to the penthouse, there is a three-bedroom apartment for $15.15 million and a two-bedroom apartment listed at $6.7 million. The average price a square foot is more than $3,500, compared with the average price of $2,223 a square foot for luxury buildings in Manhattan and the average price of $1,450 a square foot in SoHo and TriBeCa, according to fourth-quarter market data from the appraisal firm Miller Samuel.

"They will have to either reduce prices by 30% or leave it on the market until the economy swings back up," Mr. Michaels said. "This is a very educated marketplace." The listing broker at the Corcoran Group for the apartments, Robert Browne, said they haven't sold because construction on the building is not done. "Nobody can go inside and see how fantastic they will be," he said, adding that construction is set to finish in June.

While buying an apartment in the pre-construction stage is not unusual, this building does not offer a model apartment simulating what the units will look like, making a sale more difficult, a broker specializing in luxury sales, Leonard Steinberg, said.

He added that it may also be a result of bad timing. "It's a very high price for that area," he said. "A year or two ago, though, it would have gone right off the market. Things were crazy and people thought if they took their time, they'd lose it."

The SoHo building, which is at the corner of Spring and Elizabeth streets, was once known as the Candle Building, but over the last several decades it has become an unofficial canvas for street artists. The walls inside and the first floor façade are covered in graffiti and other paintings.

Mr. Murdoch originally planned to make the entire building his private residence, but after falling out with his father over the future of their news empire, he returned with his wife to Australia.

After buying the building, the developers invited street artists to paint their last works on the walls, and the space was opened for a short period to the public.

Copyright 2008 The New York Sun.

[paul10003]

From the WSJ: Two Projects in Default Dog Big Home Builders

Two massive housing developments in Las Vegas, involving several of the nation's largest home builders, have received default notices on about $765 million in debt ... two joint ventures, involving builders Toll Brothers Inc., KB Home and Lennar Corp. among others, have each missed an interest payment in recent weeks ...

Earlier this week, in a filing with the SEC, Toll warned of potential "significant losses" from joint ventures projects:

We have investments and commitments to certain joint ventures with unrelated parties to develop land. These joint ventures usually borrow money to help finance their activities. In certain circumstances, the joint venture participants, including ourselves, are required to provide guarantees of certain obligations relating to the joint ventures. As a result of the continued downturn in the homebuilding industry, some of these joint ventures or their participants have or may become unable or unwilling to fulfill their respective obligations. In addition, we may not have a controlling interest in these joint ventures and, as a result, we may not be able to require these joint ventures or their participants to honor their obligations or renegotiate them on acceptable terms. If the joint ventures or their participants do not honor their obligations, we may be required to expend additional resources or suffer losses, which could be significant.