The Next Generation of Gotham’s Grooviest Skyscrapers
Press - October 20, 2018
New York is undergoing a skyscraper evolution with a slew of towers ranging from 800 feet tall to nearly twice that; and all clamoring for a spot on the skyline.
The demand for tall, taller and tallest is being fueled by a safe city and banking haven that will welcome a record 58 million visitors, NYC & Co. predicts.
Some will return to buy dramatic and luxurious residences with jaw-dropping views as a pied-a-terre if not de facto safety deposit box, even as locals stake out their own suite spots.
Some buyers will rent them out, some won’t be allowed to rent, and some will include them in their collection of world city residences. And some will simply call them home.
“They don’t want to have the same exposure as they do to the stock market,” said Jay Neveloff, head of real estate at Kramer Levin of the investor mindset. “The condos at 432 Park aren’t going down 2 percent a day.”
Indeed, the pricing keeps going up because the City is just an expensive place to build. In Asia, where many tall towers are constructed, Stephen DeSimone, DeSimone Consulting Engineers, says migrant laborers are paid $10 per day. “We can make [the super talls] here, but it becomes exponentially more expensive.”
A 50 story luxury condo building might cost $450 a foot to build, but move up to 70 or 80 stories and the pricing doubles. “Over 1,000 feet it keeps getting more expensive,” DeSimone says.
The high costs push final condo pricing into the stratosphere as sales from $5,000 to $10,000 per foot lets builders spend $1,000 a foot on land and $1,000 on costs such as high-priced Starchitects.
“They are super high quality and no expense is being spared,” noted DeSimone.
“If you like looking at a Picasso you buy it for your wall; if you like looking at Central Park why not buy a penthouse?” said Carol Willis, director of the Skyscraper Museum in Lower Manhattan.
Willis predicted towers would get taller and slimmer as construction techniques were perfected.
“You won’t see a rental building this height,” Willis observed.
Where land is cheaper, reports say the 914-foot Queens Plaza Park in Long Island City will have condos on top and rentals on lower floors.
Harry Macklowe and CIM Group topped off 432 Park Ave. at 1,397 feet with 96 stories. A $95 million penthouse was snapped up in 2013 by a Saudi real estate titan.
A search on City Realty on Oct. 1st found 420 apartments priced from $10 million and up. If you can spend $30 million or more, just 58 apartments are for sale with a median price of $36.5 million for condos or $7,625 per foot. While co-ops have a higher median of $39.9 million, the price per foot is much less at $3,142 per foot.
But these are just beginning.There are at least 15 that will top 1,000 feet tall — with just Extell’s One57 open but not sold out — and another dozen or so that will be upwards of 500 feet.
Overall, the market may be looking at hundreds of units for sale for $10 million and up.
Appraiser Jonathan Miller says a sponsor may have 25 units for sale but hold back 75 or more. Worse, only 40 to 60 units are sold at these prices each quarter. “We are looking at four, five, six years to absorb that number of units,” he said.
Miller, President/CEO of Miller Samuel, who keeps tabs on sales, wonders like many others, “Just how many $10 million buyers are there?” Since land is now priced as if all the units will cost $10 million Miller says developers are now splitting them to get two to sell at $5 million each.
“We are not building to the demand as the demand is at a lower price point. Hence we have an affordability crisis in America and the municipalities are grappling because we are seeing product built for only the upper end.”
Tall towers can be developed in Midtown, plus portions of Downtown, Downtown Brooklyn and Long Island City so they end up in clusters. Frank Chaney of Rosenberg & Estis said, “The big selling point for the supertall, pencil towers, are views. And with all due respect to my Brooklyn friends, the views aren’t the same; unless you want a view of Manhattan.”
The lure of developing an awe inspiring skyscraper continues.
“More than apartments, I am selling views,” said Francis Greenburger, CEO of Time Equities who is building the 783-foot tall 50 West St., designed by Helmut Jahn, and planning a 1,000-footer in Chicago.”
To his west, Michael Shvo, Bizzi + Partners and Howard Lorber are planning a slender condo by Rafael Vinoly that a filing says may rise to 1,350 feet; there is no height restriction. Shvo would only say it would be the tallest residential building Downtown. “We will offer residences with extremely high views and people pay a premium for amazing views. You are on the top of the world,” Shvo said. Shvo bought the site from Steven Witkoff and Fisher Bros. who have another tower rising nearby. Witkoff says the apartments for the curved glass 111 Murray St. were laid out first, and then they went high enough up to use all their footage.
“And it got us to 830 feet,” Witkoff said. “You could make an argument to slim it down and go to 1,100. But there comes a point where it reaches … diminishing returns.”
Greenburger also warned of supersized challenges: “You build a brick building and it takes a lot of wood,” he said. “But when you do a tower, you can’t say, `send me 50,000 feet of wood’ because you are buying hundreds of thousands of feet.”
Construction and safety managers must also ensure nothing falls off.
“One element we can’t control is the weather. You get up above 500 feet and the weather is totally different,” said Donald DeNardo, executive vice president, Lend Lease construction, of sites where it could be snowing above and raining at the street. “You by default become a meteorologist.”
Winston Fisher, partner in Fisher Bros., and Witkoff’s partner at 111 Murray St., said challenges abound. “The simplest thing of just getting the concrete to the top of the building takes a long time,” Fisher said.
“The construction elevator takes so long to go up and down you don’t get a full day of work,” added Witkoff.
Engineers also have to consider the force of higher winds along with the weight of the structure.
“It is not just the dead load downward force but the lateral force that is being created for lift,” said Richard Wood, CEO of Plaza Construction.
The city’s Building Dept. also goes over the plans extensively. “Our supertall buildings are the most analyzed and scrutinized,” said DeSimone.
Douglas Durst, whose company co-owns the 1,776 foot tall One World Trade, said he would not build a tall office building today. “Over a certain height you don’t get the return,” he explained.
Yet Silverstein Properties is building 3 World Trade Center to 1,079 feet and soon, will start 2 World Trade Center being designed to 1,350 feet.
Joseph Moinian is starting 3 Hudson Blvd., an office tower over 1,000 feet tall by Hudson Yards while Related Companies is working on several cloud pincers from the 868-foot tall offices at 10 Hudson Yards to 30 Hudson Yards at 1,268 feet; plus two with residences pegged over 900 feet.
In Midtown, Kushner Companies and Vornado Realty Trust are considering re-stacking 666 Fifth to 1,400 feet, and repurposing it to residential and hotel.
Large structures used to need large sites. The 861-foot tall Trump World Tower on First Ave. was developed in 2001 on half an acre — a suburban home site.
Engineering advances now allow projects to go higher on micro-plots due to evolving techniques and materials.
The slenderest proposed condo 111 W. 57 St. will go to 1,418 feet on a 48-foot wide lot of 6,843 square-feet — a jumbo apartment.
“New York should have the tallest building in the world. We are the capital of the world,” said DeSimone.
Fisher says they were very sensitive to 111 Murray’s place in Downtown and the skyline. Inspired by the Chrysler Building and the Empire State Building, the wrapped crown of the tower gently flares at the top. Fisher added. “We are inspired by, and we inspire, the rest of the world.”
The owner of the Empire State Building, Anthony Malkin, CEO of Empire State Realty Trust previously dissed plans for a 1,500-foot-tower to replace the nearby Hotel Pennsylvania that could yet be dusted off.
“I am comfortable that after this wave of development is done, the presence of the Empire State Building will remain,” said Malkin. “Whether or not the [city] cares about the iconic nature of the New York skyline remains to be seen.”