Kofi quoted in Private Wealth Magazine
A Penthouse Too Far?
Written by Leila Bouton | Read original article here
Manhattan’s iconic “Billionaires’ Row” is known for establishing new benchmarks in both the luxury and price of real estate. Now, the toniest residential area in New York City—with its ultra-exclusive condominium towers offering breathtaking views of Central Park—is experiencing its first-ever foreclosures.
Two recent lender suits against defaulting owners at luxury high-rise One57 (157 West 57th Street) have stirred concerns about the outlook for the Big Apple’s luxury residential real estate market. Are these foreclosures early warning signs of a bubble, perhaps global in scope, that could soon burst?
Donna Olshan, president of high-end Manhattan brokerage Olshan Realty, doesn’t think so. She says the recent foreclosures at One57 are isolated incidents involving borrowers who got into trouble, not indications of a coming market meltdown.
Instead, Olshan says current soft prices are partly the result of excess inventory caused by the overbuilding of expensive condos. “At $10 million and above, inventory is growing. We had too much building on the uber-luxury end of the market. Things under $1 million fly and things over $10 million are sitting,” she says.
Overpricing by sellers of luxury properties is largely responsible for stalling transactions at the top of the market, says Olshan, a 37-year veteran of the New York real estate market. “Real estate is an efficient market. If it’s not priced correctly, it won’t sell. People either remove their property from the market or they lower the price and sell it.”