Apartment Customization Goes Beyond Choosing Colors

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The New York Sun

When executives at Plaza LLC Development Group sat down to discuss the final phase of construction at their 67-unit development in Crown Heights, the conversation took an unexpected turn. By the end of the recent meeting, they had scrapped their floor plans in favor of offering raw space, even though the shell of the building is nearly complete.

“Whatever buyers want, we will provide,” Max Ribitzky, a vice president at HQ Marketing Partners, which is marketing the building at 1040 East New York Ave., said. Based on survey data from potential customers, the company decided that very basic units that buyers could fully customize would draw the most interest. “We believe it’s going to give us a huge edge,” Mr. Ribitzky said.

In the world of Manhattan real estate, customization used to mean choosing paint colors. These days, what buyers see is not necessarily what they get when it comes to apartments. Developers, faced with the prospect of slowing sales, are springing for major renovations that buyers traditionally paid for — from changing the number of bedrooms to replacing a playroom with a wet bar — even after construction has been completed.

“There’s a general understanding in the public that customization is the new standard,” a principal at Gerner, Kronick and Valcarcel Architects, Randolph Gerner, said. “But the most customization that we’ve seen in Manhattan was really three choices of bathroom cabinets. Now, we’re taking it further.”

Another example of this trend is the Dover Condominiums at West 123rd Street. The building is finished and has been on the market for several months, but the owner is now willing to replace a spiral staircase with either an elevator or a traditional wooden staircase, depending on the buyer’s whim.

At Gramercy by Starck at East 23rd Street, GKV Architects is working with developer Victor Homes to reconfigure the floor plans post-construction for the remaining high-price penthouse condominiums. And at the top floors of SkyHouse, a luxury condominium off Madison Square Park, the developer is offering a “premiere collection” of six condos on the top floors where buyers can work with architects to decorate, renovate, and combine the units.

The 12-unit Dover development, which is composed of two gut-renovated brownstones, has been on the market since the fall. The vice president of marketing for Manor Properties Group, Simon Shamilzadeh, said he noticed that spiral staircases in the two garden apartments were a deterrent to buyers. “People absolutely loved it but said that navigating the stairs with small children would be a real task, or their mother or father wouldn’t be able to do downstairs,” Mr. Shamilzadeh said.

In response, the developer has started offering several different options for the apartments. For $7,000 to $10,000, the developer will replace the staircase with traditional steps, or for $45,000 it will add an elevator. The prices are “the actual cost to the sponsor,” Mr. Shamilzadeh said. “They’re not looking to make any money on that. He’s doing that as an accommodation to sell the unit.”

At Gramercy by Starck, GKV is busy changing kitchen plans, altering the number of bedrooms, increasing the sizes of living rooms, and adjusting closets.

“It’s is an innovation that has been added to the marketplace because sales are not as brisk as they used to be,” Mr. Gerner said. “Developers are trying to add value to their product and distinguish themselves from their competition.”

Customization is also a tactic developers can use to add value without lowering prices, which many companies are loath to do despite the softening market.

“Developers are not going to budge much on the price,” a principal at Victor Homes, Ran Korolik, said.

Rather than lower the asking prices, developers must find other ways to generate buzz for their projects. “What

else are you going to offer the customer that is of real value?” Mr. Ribitzky said. “If you want to distinguish yourself, the most important factor that you can still influence is how much freedom you give your customers.”

For many developers, added construction costs are a small price to pay for selling a pricey apartment quickly. For example, Mr. Korolik said, $75,000 to change the layout on a $5 million apartment is well worth it. “If it helps me move the apartment faster, I’m happy to do it,” he said. “I’m in the business to sell apartments. I’ll do what it takes.”

Making the changes late in the game is not always that difficult, because the developers already have contractors in place working on the building. It also works for the home buyer, for whom the cost of the renovation is simply included in the mortgage payment. It is simpler than first paying for the apartment, then finding and hiring a contractor, and then waiting for the work to be done before moving in.

“It’s a daunting experience for somebody to have to hire a contractor; it’s really a very difficult thing,” Mr. Gerner said. “But if you can buy into an apartment where a talented architect is being supplied, you don’t have any of the fuss and muss.”

At 1040 East New York Ave., the idea has worked. Anton Potatov, a doctor from Europe, put in an offer to buy after he learned of the customizable plan. “I liked the concept that I can design it myself,” Dr. Potatov said, adding that he is thinking of decorating the space with wood and marble.

Convenience was certainly a factor for one Gramercy buyer, who is combining two neighboring duplexes in the building to create a five-bedroom apartment. The buyer, who asked that his name not be used because his current landlord is not aware of his plans, said he was looking at Manhattan townhouses until he came across the Gramercy, where he asked the developer if combining two apartments was an option. It was.

“They really didn’t budge on the price,” he said. “But they didn’t charge me for any changes. I look at that as a savings. With a townhouse, we would have had to gut it.”


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