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What Went Wrong at Astor Place?

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Still, co-ops make up much of the city’s housing stock, and they allow the privacy-obsessed wealthy to hide their tracks, so why should the project be a harder sell? To make up for the higher monthlies, a co-op will usually cost less than other similar projects. Yet 445 Lafayette’s apartments are premium-priced, at roughly $2,000 per square foot. (That two-bedroom apartment, for instance, goes for $2.495 million.) Miller says Astor Place came up at a function he recently attended, and brokers unanimously agreed that it was too expensive: “It’s a nice project, but at that price point it’s meeting resistance from buyers.” (If it dropped the prices 20 percent, says a rival developer, Related could cash out and call it a day.)

THEORY NO. 3: It’s not an East Village building.
“They designed a glass curtain wall in the East Village,” says one broker flatly. “A buyer in the East Village is not a glass-curtain-wall buyer. They buy apartments that are edgier but warm, that have more historical detail.”

Contextualism is tricky. It doesn’t require that a building vanish into its surroundings, but it does mean a structure has to fold into the mind-set of its potential buyers. Old-school Upper West Siders can see themselves in the Zeckendorfs’ block-long 15 Central Park West, and it’s selling fast. Richard Meier’s towers, though pushing the envelope, still resonate among a subset of design-savvy West Villagers who envision a home full of hypermodern—or retro-modern—furniture. (Though the last of the triad, 165 Charles, is moving a lot more slowly than its forebears; more than a year after presales began, dozens of apartments are still empty.)

“Who’s going to spend $5 million there?” says a broker. “I’ll have skateboarders outside my window.”

The people who do buy in glass towers, on the other hand, still think of the East Village as “not the greatest place in the world,” as one developer put it. “For a drink maybe, but to live there?” Another broker who works with developers both uptown and downtown asks, “Who’s going to spend $5 million there? If I’m spending that money, I’m not living on Astor Place. I’ll have skateboarders outside my window and the subway underneath me.”

A comparison can be found in 21 Astor Place, a library that Elad Properties converted into luxury lofts in 2003. It was a hit, though they did have to split a big penthouse into three apartments before it sold. The project was ambitiously priced—Elad asked a then-unheard-of $1,000 per square foot—but its 60 units sold in six months. “We kept period details and married them with contemporary design,” says Richard Cantor, who marketed the building.

THEORY NO. 4: The glass-tower boom has made buyers choosier.
None of these issues would probably have mattered a couple of years ago, when slapping a starchitect’s name on the sidewalk shed and loading the building with amenities would’ve been enough to lure buyers. It’s too soon to use the word glut, but there’s a lot more product on the market now. That means developments have to hit all their marks, says Warburg Realty’s Richard Steinberg. They have to be well designed, innovative, and, as the truism holds, in just the right location.

“You can’t just throw a dart on a map and build,” a local developer says, sounding a little wistful. “Buyers are more conservative.” They’re also more sophisticated, says broker Michele Kleier. “Three years ago, people didn’t care if the rooms were small or if the floor plans didn’t work. Now they care.” Identifying the audience is key, and it needs to happen early. “The first thing we ask is who the buyer is,” explains Shaun Osher of CORE Group Marketing, a firm working on several new buildings. “Either the product resonates with them or doesn’t.”

Fifteen Central Park West certainly has. In seven months, the Zeckendorfs have sold more than $1 billion worth of apartments—it took Time Warner five years to reach that level, though it did have many more units to unload—and the sales push is winding down. The Plaza, unsurprisingly, is a winner, as is André Balazs’s 40 Mercer.

Interestingly, of the more than a dozen brokers and developers interviewed for this article, few had anything negative to say about those buildings. Yet many griped about Astor Place. (Maybe a few too many. People do throw stones at glass houses, especially those claiming to be Sculptures for Living.) “All of a sudden, these developers are learning they should talk to brokers. We are the eyes and ears of the buyers,” says one extremely successful agent. Revenge, apparently, is a dish best served in a cooling market.

THEORY NO. 5: It’s not actually bombing at all.
Though everyone seems eager to take potshots, Related may get the last laugh. According to David Wine, Related’s vice-chairman, the rumors are wrong: The original financing is paid off, and only a quarter of the apartments are unsold. The last of the four penthouses is just now coming on the market for $12 million, and as of press time three offers are on the table. And the Journal story saying almost nothing’s moved for six months? One apartment, says Wine, sold a few weeks ago to a friend of a resident, who came by to visit and loved it. Another two just went into contract. “[It’s] a very big financial success,” he declares. “And then some.”


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