Led by luxury development projects on the Lower East Side and Midtown West, Manhattan is set to undergo an unprecedented wave of new construction over the next three years, with projected condominium sales expected to reach record highs in 2020, according to a CityRealty report.
Released Tuesday, the Manhattan New Development Report forecasts residential sales of $9.8 billion in 2018, largely due to the completion of One Manhattan Square, a luxury Extell Development sky-rise featuring 815 condo units that will be among the largest in the city’s history. In Midtown West, residential towers including 220 Central Park South, 111 West 57th Street and Central Park Tower, another Extell property, will thrust an additional 1,000 units into the market. Sales are projected to rise to $11.6 billion in 2019 and $11.9 billion in 2020, according to the report.
“What we saw this past year, in particular, was a slight fall off in terms of sales volume, number of units and aggregate sales haul,” said Gabby Warshawer, director of research at CityRealty, a real estate listing website. “However, what we’re looking at over the next few years, based on the offering plans that have been filed, is an actual increase in all of those numbers.”
In the aftermath of the 2008 economic crisis, new condo sales plunged to fewer than 1,000 units from 2012 through 2015, according to the report. In 2016, more than 2,000 units changed hands, but condo sales this year are expected to cap at just 1,700 units, said Warshawer, citing a softened luxury market that has dragged the sales aggregate down to $8.3 billion.
In the third quarter of 2017, the average condo price clocked in at $3.9 million, down significantly from $6.1 million during the same period a year earlier. As new luxury units enter the market over the next several years, however, those prices are expected to increase.
Of the 5,636 units expected to hit the market across 72 buildings over the next three years, at least nine could fetch more than $1 billion in total sales. Topping the list is Central Park Tower, the 1,550-foot Extell building expected to house a Nordstrom department store and 179 luxury condo units, totaling an estimated $4 billion in aggregate sales, according to the report.
220 Central Park South, meanwhile, is expected to command some of the loftiest prices in city history when its 87 units hit the market next year. On average, the building’s price-per-square-foot clocks in at $8,431, with several units expected to fetch more than $100 million, including a $250 million, four-story quadruplex already described as the most expensive home in the city.
On the Lower East Side, meanwhile, One Manhattan Square could earn a total of $1.9 billion when its 815 condo units hit the market at $2,281 per square foot, according to the report.
“We’re not seeing that developers are decreasing their prices all that much, and the way they’re planning for the future, they’re not going to be,” said Warshawer. “Aside from that, there are some fantastically expensive buildings currently being developed right now that we’re going to see close over the next few years — so that push at the very upper level is still alive and well.”
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