This is Corey Cohen, founder of The Roebling Group – the #1 Google-ranked real estate agency with a 10-year history, 300+ completed deals, and $400m in total deal volume.
The Roebling Report is our bi-weekly newsletter that summarizes everything you need to know about New York City real estate.
Let’s jump into it.
Manhattan’s Luxury Market Gets a LDW Bump
Manhattan’s luxury real estate market has shown signs of life recently.
In the week leading up to Labor Day Weekend, 18 total contracts were signed for homes asking $4 million or more. This is up by 7 from the previous week and could be a sign that the luxury market has hit a turning point.
Most notably, a contract was signed for the pricey 79th floor at 432 Park Avenue. This Billionaire’s Row unit was originally listed for $92 million but ultimately went into contract for closer to $70, according to the Wall Street Journal.² Had this unit sold for its asking price of $92 million, it would have been the most expensive sale of the year. But, $70 million is still enough for second place.
Market Reminder: The full-floor unit that just sold at 432 Park Avenue for $70 million was first listed for $135 million in September 2021. This is a reminder of how the luxury real estate market has fared over the past few years.
NYC Imposes De Facto Ban on Airbnb
Since its inception, Airbnb has been operating with questionable legality – often launching their short-term rental platform in new cities first and asking questions later. At one point, NYC was home to around 40,000 Airbnb rentals. But, thanks to a major announcement, Airbnbs in NYC could become a thing of the past.
As of September 5th, Airbnb hosts must register with the city in order to rent their places for stays under 30 days.¹ To qualify as a valid rental, hosts will need to live at the rental property during stays and are limited to just two guests per visit.
This announcement is an effort by NYC officials to try and curb the housing shortage, which is driving rent prices to record highs. The rise of short-term rentals has helped exacerbate the housing shortage – since more short-term rentals means fewer available units for locals to rent.
Due to NYC’s size and influence, this ban will have massive implications for how other cities choose to regulate Airbnb, VRBO, and other short-term rental companies.
Early Numbers: As of August 28th, the city had approved just 257 out of 3,250 Airbnb applications
NYC Comptroller Shoots Down $432 Million Migrant Services Contract
NYC Comptroller, Brad Lander, has rejected the $432 million no-bid contract for migrant services that had previously been awarded to the medical services provider, DocGo.¹
This lucrative contract had been awarded to DocGo on the stipulation that the company help house and care for migrants in NYC. However, Lander shot the proposal down on the basis that DocGo had no experience in social work. He also stated that the city had failed to provide any “meaningful detail” on why DocGo should be authorized to bill the city for hundreds of millions of dollars.
Next Steps: This rejection will bar the city from paying DocGo as part of the contract, which is currently being handled by the Department of Housing Preservation and Development. However, DocGo still has the option to resubmit a less expensive proposal or a new proposal that addresses the highlighted flaws.
Mayor Eric Adams – who initially passed the bill – also has the power to overrule the comptroller and push the contract through.
Landlords Are Starting To Prioritize Pooches
Pets and landlords have historically been heated rivals.
Due to their destructive tendencies, landlords often viewed pets as a potential risk to their assets and, as such, either charged an additional monthly fee or banned them altogether. But, this sentiment is starting to change quickly thanks to a growing interest in pet ownership.
During the pandemic, many WFH employees scooped up a furry friend to keep them company, and – as of 2022 – roughly 36% of US apartment residents had a pet. Now, instead of turning away pet owners, luxury apartments are starting to cater to them.
Many complexes across the US have started offering a slew of pet perks including dog schools, pet happy hours, giant rooftop dog parks, and even so-called “yappy hours” featuring free treats and pup cups.
Ironically, paying to put on free events for pups might actually prove to be more lucrative in the long run than charging a pet fee.
Surprising Stat: One survey conducted by Atlanta-based landlord, Cortland, found that dog owners rank the building’s pet policies as more important than location and even rent.
Rapid-Fire Headlines
Leasing activity in Manhattan fell 25.6% annually in August. Additionally, the office vacancy rate remained at 17.8% with 96 million square feet available for rent in Manhattan
The average interest rate for a 30-year fixed-rate mortgage fell to 7.21% for the week ended September 1st. This is the first weekly decrease in mortgage rates in the past six weeks.
Jimmy Buffet tragically passed away on September 1st, after a four-year battle with Merkel cell skin cancer. The business tycoon owned a Margaritaville in Times Square as well as a personal home in Sag Harbor.
WeWork has announced that it will renegotiate almost all of its leases. The co-working company has been teetering on the edge of bankruptcy for weeks.
A program called “Smart Curbs” has kicked off in the Upper West Side. This new plan intends to rethink how the city utilizes valuable curb space and should hopefully help unclog the streets.
That’s all for now! Be sure to keep an eye out for the next issue of The Roebling Report – your go-to source for NYC real estate news.
Have a question about buying or selling real estate in NYC? Please feel free to contact me using the information below or by submitting a form here.
Best,
Corey Cohen
Founder
The Roebling Group
ccohen@roeblinggroup.com
646.939.7375
@mrcoreycohen
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