Manhattan's residential rents are now reaching into the high $100s per square foot in some elite buildings. According to StreetEasy, 160 Central Park South even has multiple apartments with asking rents approaching $200/SF. A unit there rented for $16,000/month or $174/SF. Other luxury buildings which command the same asking rents include 170 East End, 40 East 66th Street, 240 Park Avenue South, and 40 Bond.
As lofty as these rents seem, New York City is still a relative bargain compared to other major global cities. According to ECA, the average rent for a New York City two-bedroom apartment was only 17th on the list as the most expensive city. The top three were Tokyo, Moscow, and Hong Kong. In Tokyo, ECA reported that the average two-bedroom rented for $4,352 per month. After incorporating some of the above mentioned rents, I think it's safe to say that New York City will vie for one of those top slots in 2011.
One sale which benefited from these $100 /SF rents was The Corner at 200 West 72nd Street. According to the The Wall Street Journal it sold to TIAA-CREF, a major retirement system, for $209 or around $1 million per unit. The sellers, Philips International and Rhodes Associates, assembled the site for the 196-unit building on Broadway and 72nd St. The venture will keep the 48,000 square feet of retail space in the property, whose tenants include Trader Joe's and Duane Reade.
The sale price, about $1,400 a square foot, is almost triple the average $/SF that Massey Knakal tracked in 1Q11 for elevatored apartment buildings. Its high price reflects the premium rents, which were free market and renovated at condo quality finishes. For example, unit #15E, a three-bedroom apartment with 2.5 baths, rented in the building for $18,000 per month or about $127/SF.
The property's initial yield for TIAA-CREF is estimated in the 4% to 5% range. The sellers were represented by Darcy Stacom, vice chairman of CB Richard Ellis. TIAA-CREF "wanted to own the Seagrams Building of residential apartment houses," she says.
The sale of the Corner appears to be the highest for NYC on a $/SF basis, although it's well below the $2.5m/unit record from when the Apthorp sold in early 2007. That being said, that sale was “only” at $918/SF, which was attributed to the many regulated units which existed there. Nonetheless, the Corner sales demonstrates that the bar continues to be raised in.