Apartments going cheap on Wall St

Real estate broker Ronnie Diamonde expected the three-bedroom apartment in New York's Financial District, listed in August for US$1.64 million and seen by 145 potential buyers, to sell in eight weeks.

The condominium in the triangular Cocoa Exchange building was reduced twice by a total of 21 per cent over four months to US$1.3 million, according to Streeteasy.com, a service that tracks New York real estate prices. A buyer will probably sign a contract this week for even less, said Diamonde, of the Corcoran Group, who has three other listings in the building.

The Financial District suffered the deepest price cuts in Manhattan in the first quarter as securities firms shed more than 180,000 jobs in the Americas.

Manhattan apartment sales fell 48 per cent from a year earlier, real estate appraiser Miller Samuel said. Sellers lowered prices on almost a third of condo or co-op listings by an average of 11 per cent in the Financial District, says Streeteasy.

Downtown has been "disproportionately impacted by the layoffs and contraction of the financial services sector," said Jonathan Miller, president of New York-based Miller Samuel.

In TriBeCa, the site of converted warehouses and the TriBeCa Film Festival, 24 per cent of advertised apartments were discounted by an average of 11 per cent, Streeteasy said. The deepest cut in the area is at 39 Worth St, listed at US$5.99 million ($9.96 million), a 40 per cent discount.

SoLow Sellers in SoHo, home to shops including Prada and Morgane Le Fay, lowered 27 per cent of listings by an average of almost 11 per cent in the first quarter.

Spurred by tax breaks, developers moved into the Financial District after the 2001 attacks on the World Trade Centre. Prices climbed as they bought office buildings and converted them into upscale condominiums.

Then the recession hit. "In any sort of a downturn, the neighbourhoods that suffer first and fastest are the emerging areas," Kim said.

Five of the area's 10 biggest price reductions are at the Cipriani Club Residences at 55 Wall St, where markdowns ranged from 21 per cent to 27 per cent, says Streeteasy.

In a building known as Downtown by Philippe Starck, Prudential Douglas Elliman Real Estate broker and managing director Jacky Teplitzky gave up a listing after deciding she couldn't sell the apartment. "I'm good at what I do, but I'm not a magician," Teplitzky said.

There are 45 apartments for sale in the building, says Streeteasy.

There are 11,150 sales listings in Manhattan as of this week, says Streeteasy. The number is higher than any that Miller Samuel has counted since it began tracking inventory in 1999.

Kelly MacDonell, 34, and Todd Watkins, 40, considered moving from the Upper West Side to the Financial District. They toured a two-room, 15th-floor condo at the Cocoa Exchange, on the market since October and discounted 10 per cent to US$439,000.

They decided not to buy. "I'm pretty brutal in my offers, anyway," Watkins said. The owner took the unit off the market five days later even after accepting a bid in the "low fours", Diamonde said. "He was tired of people low-balling."

- BLOOMBERG