Volume 79, Number 6 | July 15 - 21, 2009
West and East Village, Chelsea, Soho, Noho, Little Italy, Chinatown and Lower East Side, Since 1933


Mixed Use

By Patrick Hedlund


A Virgin no more
 
The Virgin Entertainment Group has sold its former Megastore location in Union Square for nearly $5 million, marking the once-popular media purveyor’s official exit from the space.

According to the New York Observer, which cited a public deed signed on Monday, Virgin sold the nearly 60,000-square-foot, two-level space to Union Square Development Associates for $4.81 million.

The Related Companies owns the building that housed the once-popular store, at 14th St. and Broadway, and the company shares the same corporate address as Union Square Development Associates.

Related co-owns Virgin Megastores along with Vornado Realty Trust, which plans to shutter the Times Square Virgin Megastore location by early next year. After that, there will be no more Megastores left in the U.S., U.K., Canada, Ireland, Spain and Japan.
 
 
Village units plunge
 
The average sales price of apartments across the Village tumbled more than 36 percent over the last year, according to a second-quarter report on citywide homes sales by the Real Estate Board of New York.

The Greenwich Village market saw the largest decreases, with the average price of all condo and co-op units in the neighborhood dropping by 43 percent — from $1.65 million in the second quarter of 2008 to $940,000 currently. The Village’s condo market proved particularly volatile, plunging by 51 percent from $3.47 million to $1.7 million year over year.

The average price of all units in the East Village market fell by an average of 34 percent — from $997,000 in 2008 to $657,000 in the second quarter of this year. The West Village was not far behind, posting a 32 percent slip from $1.56 million last year to $1.05 million.

The only Manhattan neighborhood to take a bigger hit than the Greenwich Village market was the Upper West Side, where prices were off 44 percent on average.

Soho and the Lower East Side fared better over all, with Soho prices decreasing an average of 12 percent (from $2.59 million to $2.28 million) and the Lower East Side softening by 15 percent (from $959,000 to $815,000).

Apartments in the Gramercy/Kips Bay market slipped by 13 percent on average, while those in Chelsea/Flatiron posted an 8 percent gain over all. The only other markets in Manhattan to show increases over the last year were Tribeca (up 10 percent), Battery Park City (up 155 percent) and Inwood (up 4 percent).

Average prices across the borough dipped 19 percent year over year, from $1.548 million to $1.248 million.
 
 
Post-bust planning
 
The city unveiled a pilot program last week that would convert unsold or unoccupied market-rate apartments into affordable housing to help counteract the slumping post-bust economy.

First introduced by City Council Speaker Christine Quinn during her State of the City address earlier this year, the Housing Asset Renewal Program, or HARP, seeks to capitalize on the building crisis by working with developers and banks to lower the cost of certain projects to below-market rates.

The $20 million program would turn unsold condo units, market-rate rental buildings and stalled construction sites into affordable housing opportunities for moderate- and middle-income residents.

The program will focus on two types of developments — finished projects with a large number of vacancies, and stalled construction sites — which will be selected based on their ability to keep specific communities stable, the amount of public assistance required to achieve maximum affordability, and which developers and banks offer the deepest discounts below market rates.

The city will not own the units, but instead provide financing and work with current building owners to negotiate the lowest possible price. 

“Private developments that sit vacant or unfinished could have a destabilizing effect on our neighborhoods, but we’re not about to let that happen,” said Mayor Mike Bloomberg, who joined Quinn at the July 8 announcement at City Hall. “This program holds out the promise of addressing the unintended blight caused by vacant sites, while transforming what would have been market-rate buildings into affordable housing for working-class New Yorkers.”
 

high Retail rents ’r’ us
 
Despite a 10 percent decline during the last year, New York City’s prime retail rents remain the most expensive in the world, according to report by brokerage CB Richard Ellis.

The city’s typical open-market rental price of $1,800 per square foot nearly doubled that of the next-closest market, Hong Kong, which had an average price of $975 per square foot along its top-quality retail corridors. Moscow ranked third over all on the list, followed by Paris, Tokyo and London. 

America’s next most-expensive markets, Los Angeles and San Francisco, came in at the ninth and 10th positions worldwide, the report added, with San Francisco showing an increase of 20 percent since last year.

The figures represent typical headline rents that an international retail chain can expect to pay for a ground-floor property of the highest-quality space in the best location in a given market.



mixeduse@communitymediallc.com

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