2. MARKET UPDATE
With condo prices throughout Manhattan soaring over $1,500 per SF and over $1,800 per SF for
new construction,it has become clear that condos and even more so luxury condos are the New
York City developer’s play. In its entirety, Manhattan is diluted with recent condo conversions and
ground up construction as the market out-paces itself quarter after quarter. Defying the trends,
East Harlem (East of Fifth Avenue and north of 96th Street), has upheld as a rental market. If you
take a look at the provided sample of about 600 transactions from new construction buildings,the
numbers do all the talking. Although condo prices agree to increase with the rest of the borough,
they are still outpaced by rental prices in East Harlem. Since 2012 rental prices have increased
nearly 21%, averaging a growth of 6.5% annually. These figures trump the condos 15% since 2012
and 4.5% annually.Harlem as a whole,but particularly East Harlem,is behind the curve on prices in
Manhattan and as the luxury bubble continues to spread north, the gap is starting to close.
The upside of rental prices in East Harlem has not only steered developers but has been the
driving factor behind the notable increase in land prices.On a buildable square basis the land prices
in East Harlem have increased an astronomical 171% since 2012 averaging a growth of 41% annually.
Using these figures the prices are on path to break $300 per buildable square foot in the very
near future.
2012 2013 2014 2015
% Change From 2012 to Present: 15.06%
Average % Change Per Annum: 4.5%
$760
$740
$720
$700
$680
$660
$640
$620
$600
$760$755
$735
$660
$50
$45
$40
$35
$30
$25
$20
$15
$10
$5
$0
2012
$36
2013
$40
2014
$41
2015
$44
% Change From 2012 to Present: 20.78%
Average % Change Per Annum: 6.51%
Price Per SF - Rentals
The key to any growing market is new
development. In the last couple of years, East
Harlem has seen a burst of multifamily
development.These projects are being headed
by some of the city’s major developers such
as HAP, Continuum Company, Blumenfeld
Development and SKA Marin. New projects
draw other developers to any region,
East Harlem has further tried to draw devel-
opment by pushing to re-zone large sections
of Madison, Park and Lexington Avenues to
allow for taller, mixed-use construction. This
would make it worth the play of more major
developers, as well as strengthen both the retail
and residential aspects of the enterprising
neighborhood.
Price Per SF - Condos
% Change From 2012 to Present: 171.26%
Average % Change Per Annum: 41.02%
New Developments
Price Per BSF - Land
$250
$0
2012
$87
2013 2014 2015
$236
$139
$117
$200
$150
$100
$50
146 East 126th Street – Blumenfeld
rental development planned in a T-shape will
be a large, 231,900 SF multifamily building.The
first two floors are set aside to be commer-
cial space totaling 34,444 SF. The remaining
will be divided into 233 residential units.The
make up of the units will include 66 studios,
145 one-bedrooms and 22 two-bedrooms.
The developer has assigned 47 units inclusion-
ary housing.
2211 Third Avenue – HAP rental develop-
ment totaling 120,000 SF. The building will
be split into 78,000 SF of residential, 26,000
SF of retail, 5,000 SF of parking and 1,000 SF
of community facility space. The project is an
80/20 deal therefore 20% of housing will be
deemed affordable.These units will build up a
total 10 stories.
1800 Park Avenue – Ian Bruce Eichner of
Continuum Company development totaling
over 696,000 SF. The break up will be 63,200
SF of commercial space and 633,700 SF of
residential space. This will make for Harlem’s
tallest building ever at 19 stories rising 352
feet.The developer has decided to keep 11%
(70) of the 650 units affordable. The building
will offer 123 parking spaces after the
variance of zoning to include more retail.
1918 First Avenue – Former Draper Hall a
retired nurses’ dormitory has been leased to
a developer to convert the site into a subsidized
senior housing building. This conversion will
house 203 units in the same 14-story, 123,000
SF shell. Developer SKA Marin leased the
subject property from the city’s Health and
Hospitals Corporation for $100,000 per year.
They brought in Dattner Architects and work
is under way.
