Supply of Rental Apartments a Crisis for New York?
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
Few people acknowledge that New York City faces a crisis, that residential rental apartment towers are becoming the dinosaurs of the 21st century. Over the past few years, owners of residential buildings have been selling to investors who plan to convert the properties into condominiums. Recently a number of these rental properties, as well as office buildings, have been converted to apartments that are now being offered for sale as residential condominiums.
Two historic residential rental apartment buildings are being marketed for sale. Earlier this month, the 12-story Apthorp, with about 170 apartments and 50,000 square feet of ground-floor retail came on the market. The building, which was built in 1908 on land once owned by William Waldorf, occupies an entire block at 2207 Broadway and 390 West End Ave. between 78th and 79th streets. Industry leaders expect the building to fetch more than $500 million. The other building is the 13-story Langham at 135 Central Park West and 73rd Street. Many believe this building will sell for more than $600 million.
In 2004, a joint venture of Lloyd Goldman, Joseph Chetrit, Joseph Nakash, and Mann Realty purchased the 16-story, 59-unit, Emery Roth-designed 1928 apartment building at 1200 Fifth Ave. The joint venture paid about $61 million to its owner, the Mount Sinai Medical Center. Last month, the condominium sales office opened at the building, which is on East 101st Street across from Central Park. It is reported that Mr. Goldman will be selling the 32-story, 261-unit rental building, the Camargue, at 303 E. 83rd St. to an investor for condominium conversion.
Last year Cabrini Medical Center sold a building on Second Avenue to an investor who plans to convert the property into condominiums. Lenox Hill Hospital is in negotiations to sell a few of its properties near the medical center. The Continuum Health Partners are the owners of the Elektra, a 32-story, 166-unit rental tower that was built in 1992. The building – which sits in the heart of the Gramercy Park area on the west side of Third Avenue between 22nd and 23rd streets – is about 116,000 square feet in size and has two retail tenants. The building will be delivered vacant and is expected to sell for close to $90 million, or $750 a square foot.
In 2005, Macklowe Properties sold a number of residential rental buildings in Manhattan. One of the properties was a nine-story building at 40 W. 55th St., off Fifth Avenue. Macklowe sold the building to Ditmas Management, headed by Samson Management and Aaron Sirulnick. Macklowe bought the 1924
building in 1997 from Emigrant Savings Bank, which renovated the property into 36 residential apartments. On the East Side, Samson Management is seeking about $50 million for 865 U.N. Plaza, a rental building with 81 units and three retail stores, in a possible sale to an investor, who is likely to convert the property to condos.
A number of properties on the Upper West Side are slated for conversion from rental to condominiums. In October 2004, Brack Capital Real Estate acquired the 19-story, 268-unit apartment building at 230 Riverside Drive on the northeast corner of 95th Street. The building was erected in 1903 at West 96th Street and the Henry Hudson Parkway. Brack and Stellar Management are converting the 16-story Olcott Hotel at 27 W.72nd St. The property was built as an apartment hotel in 1925 and is in the Upper West Side Central Park West Historic District. A few blocks away is the 19-story, 33-unit apartment tower that is owned by the Rinzler family. It is at 22 Riverside Drive on the northeast corner of 74th Street. The former Leader House, built as a Mitchell Lama development in 1972, is also being converted. The 32-story rental tower with 279 apartments is at 100 W.93rd St. on the southwest corner of Columbus Avenue. Stahl Real Estate – which owns the Apple Bank for Savings building at 2112 Broadway occupying the full block between Broadway, Amsterdam Avenue, 73rd Street, and 74th Street – is converting the top four floors of the eight-story building into 28 condominium apartments. The landmark building was built in 1928 for the Central Savings Bank.
Robert Levine’s RAL Development Services is converting the 17-story, 34-unit rental building at 1478 Third Ave. between 83rd and 84th streets. The building was erected in 1982 on the former site of the Juliet I and II movie theaters. In 2004, the RAL, purchased the 1 million-square-foot Watchtower building at 360 Furman St. on the Brooklyn waterfront from Jehovah’s Witnesses for about $200 million. The company is converting the property into a condominium building named One Brooklyn Bridge Park, which will contain 449 units.
Last year, Broad Street Development Company purchased the 31-story, 147-unit residential rental, built in 1985, at 1438 Third Ave. between 81st and 82nd streets. They also acquired the adjoining six-story rental building at 1430 Third Ave. Both buildings were purchased from the General Investment Development Companies, which represented the Oregon state pension plan, which owned the properties. Broad Street has announced plans to renovate the 31-story tower at 1438 Third Ave. and convert the building into 87 condominium apartments. On September 30, 2004, the City Investment Fund and RFR Holding created Wellington Tower Partners to jointly own the Wellington Tower, a luxury residential rental building at 350 E. 82nd St. on Manhattan’s Upper East Side. The property is being converted to condos.
The former headquarters of the Forward newspaper is being marketed for sale as 29 residential condominium apartments. The 10-story building was built on the Lower East Side in 1912 to be the headquarters of the Jewish Daily Forward. In 1974, the newspaper sold the building to the Lau Family. For close to a quarter of a century, the building was used as a Chinese church and bible factory. In 1998 the property was converted into 39 residential apartments. When the newspaper sold the building, it moved its headquarters to 49 E. 33rd St., which serves as an office for the Workman’s Circle Organization and other nonprofits. The building, between Park and Madison avenues, may be sold and converted into a residential condominium.
A total of 40 apartments are located from the 33rd to 47th floors of the mixed-use building, the Capri, at 235 E. 55th St. The building was opened in 2003 and developed by Arun Bhatia, who built the floors as condominium units and decided to lease them as rentals. The lower 32 floors of the building serve as a dormitory for Marymount Manhattan College. Mr. Bhatia recently began marketing a new residential condominium at 139 Wooster St. in SoHo. The development consists of two eight-story buildings with a total of 16 apartments, with building fronts on Wooster Street and West Broadway.
In the financial district, a number of properties are being converted from rental to condominium. In 1997,the former 24-story Travelers Insurance building at 80 John St. was converted to rentals. The owners are now marketing for the sale the 145 rental units in the tower called South Star. Steven Witkoff, the chairman of the Witkoff Organization, who is converting the former Regent Wall Street at 55 Wall St. and the top floors of the classic Woolworth Building at 233 Broadway, said, “Lower Manhattan continues to provide the first-time purchaser the greatest opportunity to own an apartment at the lowest cost in Manhattan.” The 12-story building at 25 Murray St., occupying the full block front on Church Street between Murray and Warren streets, is being converted into 74 residential condominiums.
The top 12 floors of the office building at 15 E. 26th St., which is known now as 15 Madison Square North, is being converted into residential condominiums. A few blocks away, a nine-story building at 24 E. 21st St. between Broadway and Park Avenue South is being converted into eight residential condominium apartments. These conversions offer New Yorkers and investors from around the world an opportunity to own property in the world’s greatest city.
Mr. Stoler is a television broadcaster. He can be reached at firstname.lastname@example.org.