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Real Estate Boom Turns into Bust

2008_10_7wtc.jpgThe NY Times delivers the verdict that the credit crisis has ended the real estate and construction boom. Developers aren't getting financing, landlords can't refinance properties, and companies are too afraid to move within Manhattan. Some notable examples: HSBC isn't moving to 7 WTC anymore, because bids for their Midtown location were 30% under their $600 million asking price; an under-construction Times Square building hasn't had a tenant for the past 18 months; and Standard & Poor's cut the rating for TIshman Speyer's Stuyvesant Town purchase bonds, "in part, because of an estimated 10 percent decline in the properties’ value and the rapid depletion of reserve funds." Developer Richard Lefrak says, "If there’s no liquidity in the system, it exacerbates the problems. It’s going to have a serious effect on the local economy and real estate values.”

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By Jen Chung in on October 1, 2008 8:58 AM

Comments [rss]

  • hungryghoast

    so uhh... when do we get to start paying lower rents??



    (i know i know... i'm laughing at myself/crying too)

  • TN

    tingo - that stuff won't be affected as much, it's mostly euro-tourists that are interested in that stuff already anyway.



    It's getting tight over there too, so that stuff will probably get affected as well. In other words, fewer iPods purchased by Europeans at the Apple cube & J&R.

  • NannyState

    During The Depression, vacant lots that were cleared for tall towers eventually got filled with one or two story "taxpayers", usually with lowbrow diner or theater tennants. Could we be in a new age of lowbrow tennants? I'd raise a glass of cheap crap to that!

  • Leon Freilich

    A ROGUE BY ANY OTHER NAME



    Wall Street's holding the economy hostage



    Demanding we cover its losses,



    Threatening death to credit unless



    We bear its financial crosses.

  • matty

    I'm kind of glad. NYC was way too uppity for the past 20 years.

  • Spirit of 76

    So now instead of moving cranes falling on people, we'll have debris from abandoned half-built skyscrapers falling on people?



    You mean Freedom Tower might turn out like the Hotel of Doom? On the bright side, Atlantic Yards might be kaput.

  • Larry

    Yay. One bedrooms for $999,999!!!

  • contro

    Eggscelent My plan is coming to fruition.

  • KosherPickle

    the bank gave me a pre approved mortgage..im still waiting for prices to fall even more on homes..yeahhhhhhh lol

  • drewo

    Unused midtown office space to morph into luxury condos.



    Or subsidized low-income housing.

  • jibbly

    tingo - that stuff won't be affected as much, it's mostly euro-tourists that are interested in that stuff already anyway.

  • tingo

    What about $450 jeans? Will they be affected too? Lines for cupcakes??



    Oh no!

  • JMH

    I feel so bad for Richard Lefrak that his property values are going down. Doubly so for Tishman Speyer.

  • yakatori

    boo f'n hoo

  • longacre

    So now instead of moving cranes falling on people, we'll have debris from abandoned half-built skyscrapers falling on people?

  • citylion

    Woohoo! 70 & 80s here we come again!

  • thanks goodness i refinanced last year.

  • Wait, we had a boom?

  • Felix Hoenikker

    Good.

  • Think2wice

    So we've escaped the disillusion of Wonderland and now we're back to "normal"?

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