Real estate industry update
Sign up for myFT Daily Digest and be the first to learn about real estate industry news.
American real estate developer-related companies have borrowed US$258 million from the private equity group Blackstone Group to renovate Manhattan apartment buildings. The transaction shows that despite the pandemic, they still have confidence in the luxury housing market in New York.
The coronavirus outbreak is difficult for high-end owners in New York, as thousands of residents have fled to their second homes that they thought were safe. Hampton In Long Island, New England or Florida.
The data shows that luxury rental and sales trends in the most populous cities in the United States are improving.Related, the developers behind the huge Manhattan Hudson Yards The project plans to use Blackstone’s funds to renovate rental buildings in the Tribeca community and sell apartments to wealthy residents and investors.
“New York City has shown incredible resilience over the past year and a half, and we are currently experiencing the strongest apartment market in recent history,” the relevant CEO Jeff Blau told the Financial Times.
The building is called Truffles Tribeca and consists of two towers connected by a sky bridge near the Hudson River. Related companies purchased the complex for US$260 million in 2019, trying to use Tribeca to transform from a faded commercial area into an expensive neighborhood.
The company was founded by a billionaire developer Stephen RoseAccording to people familiar with the plan, the company has emptied the ten-year-old building in preparation for a complete renovation, which includes changing the interior and replacing the exterior walls.
“lender [were] Be scrambling to participate in this opportunity,” said Jordan Roeschlaub, co-head of structured finance at Newmark, the real estate consulting firm that facilitated the transaction.
These renovation works will be funded by a construction loan from Blackstone.As one of the largest real estate investors in the world, this private equity group has a large number of operations in New York, with a ceiling of Stevenson Town And Peter Cooper Village, which is an 11,250-unit apartment complex, which was purchased in 2015.
Recent trends in the New York real estate market may justify Blackstone’s decision to double its investment in urban real estate during the epidemic. Pandemic“People are now fleeing the city,” Blackstone chief operating officer Jon Gray said in October last year. “We think this will come back, but there is an opportunity to invest in them at attractive prices.”
The city’s residential apartment and co-op sales rebounded in the second quarter of this year, with 3,417 units in Manhattan, more than double the number in the same period last year. Real estate agent Douglas Elliman said this was the busiest three months since 2015.
Luxury rentals have also attracted new residents. According to the building’s owner Brookfield Asset Management, during the worst of the pandemic, architect Frank Gehry’s undulating downtown apartment complex was almost a third vacant. The company added that this month, the occupancy rate of the Gehry Building in New York was 96%.