The Real Deal - New York Real Estate News

While hotels sit empty due to the coronavirus, some operators are offering up their rooms to medical personnel and non-critical patients. The Four Seasons Hotel on East 57th Street, the Room Mate Grace Hotel and the Wythe Hotel have offered free housing for doctors, nurses and other staff, while the St. Regis Hotel, the Palace Hotel and Yotel will be providing space for non-critical care patients, according to a press release from Gov. Andrew Cuomo’s

Tucked inside the federal government’s massive economic rescue package is a $170 billion windfall for real estate investors. Washington’s $2 trillion bill is a provision that allows investors to write down the depreciation on properties beyond the previous limit of $500,000 a year, the New York Times reported. According to a draft congressional analysis, it’s the second-largest tax giveaway in the multitrillion-dollar proposal. “It’s a pretty big deal,” Peter Buell, an accountant who heads up

Americans filed a record number of unemployment claims last week, and in New York state, restaurants and hotel owners said Thursday they would be laying off thousands of workers. The 3.3 million jobless claims bulldozed the prior record from 1982, according to data from the U.S. Department of Labor. For the real estate industry, the jobless claims mean that companies forced to close because of the coronavirus have had to lay off scores of workers.

UPDATED Thursday, March 26, 2020, 5:55 p.m.: A group of more than 250 restaurant owners including chefs Bobby Flay and David Burke are ready to put the heat on the real estate industry. The organization, dubbed The Restaurant Network, seeks to establish a set of “universal terms” restaurants can present to their landlords. It was started by New York City hospitality consultant Steven Kamali, who wants to draw up a roadmap to help restaurants survive

Tenants at an East Village building owned by Kushner Companies will not have to pay rent until the real estate firm secures a certificate of occupancy for the building, a housing court judge has ruled. Residents of the building at 331 East 9th Street will also be allowed to stay in their apartments without paying any back rent, according to the decision that Judge Frances Ortiz handed down Tuesday. The decision comes as the city

Many minority and women-owned construction companies say they are struggling to pay their employees and anticipate layoffs over the next few weeks and months, according to a new survey. The Minority & Women Contractors & Developers Association, a New York-based nonprofit organization, asked its members this week how they’ve been impacted by the coronavirus pandemic. Of the group’s 84 members, 71 responded — nearly all of whom indicated that they are having difficulty making payroll.

After an auditor’s worried note set off an “earthquake” for Related’s Israeli bonds this week, representatives for the bond-issuing entity told investors that everything is under control. On a conference call with investors at 5 p.m. Tel Aviv time, Related Commercial Portfolio executives pointed to the corporation’s strong finances as a safeguard against potential risk, as the company seeks to refinance maturing bonds amid economic upheaval. “As everyone is aware, we are in the midst

The coronavirus pandemic has slammed the residential market and left homeowners wondering if they’ll be able to make their payments, but at least rates are down, right? The average rate for a 30-year fixed mortgage dropped to 3.5 percent from 3.65 percent last week, according to data from Freddie Mac reported by Bloomberg. Freddie Mac itself is offering various mortgage-relief packages in light of the pandemic. Mortgage rates dropped to a record low of 3.29

CoStar Group has borrowed $745 million from its line of credit to fund its acquisition of RentPath, and as a hedge against the tumultuous market. In a regulatory filing Thursday, the real estate data firm said, “The increased cash position… allows for greater financial flexibility in light of current uncertainty in the global markets resulting from the COVID-19 outbreak.” In the filing, CoStar said the proceeds may also fund “other potential strategic acquisitions” and general

Requests by the Hamptons, North Fork and upstate to stop the virus-inspired migration from New York City have not resonated with Gov. Andrew Cuomo. The popular summer destinations say they have been overrun by city residents fleeing the five boroughs, which have been the epicenter of the coronavirus outbreak in the U.S. But Cuomo said at a Thursday morning press conference, “I don’t have any travel ban on my agenda.” In a message to constituents

New York is considering limiting the types of construction that qualify as “essential.” Gov. Andrew Cuomo indicated that he is open to changing his executive order of last week that exempted all construction from a ban on employees of non-essential businesses reporting to work. Construction has continued throughout the city, even as criticism has mounted over the lack of distinction between emergency work and high-rise luxury towers. “I think some construction is essential,” Cuomo said

A coalition of five real estate and professional appraisals organizations are appealing to local and state governments to declare property appraisals as essential business. Executive orders compelling non-essential businesses to stop reporting to work have been put in place in many states, cities and counties throughout the country amid the pandemic. But only seven states so far have declared appraisals for real estate-related services as exempt from those restrictions, the group asserts. In a letter

While the majority of life in New York City has come to a standstill, some development work plows on. Toll Brothers this week filed an application with the city’s Department of Buildings to construct a 13-story mixed-use building on the Upper West Side. The project, at 2686 Broadway, would sit between West 102nd and West 103rd streets. The development will span nearly 119,000 square feet and have 73 apartments. About 7,700 square feet is zoned

The world’s economy may tumble into a recession due to coronavirus, but some top Los Angeles real estate brokers are striking a note of optimism. “I really think there’s going to be pent up demand. I wouldn’t be surprised if we see our best third quarter in many years,” said Jason Oppenheim of the Oppenheim Group, who added business could return to normal within six weeks. “We don’t necessarily have lost revenue, we have deferred

A $154.6 million loan for a Brooklyn development site has fallen into default, according to Apollo Commercial Real Estate Finance. The lender made the disclosure in a recent public filing, stating that the borrower stopped paying interest at the beginning of March, and the property is now for sale. Apollo did not reveal details about the site’s location, but Crain’s reported that the loan was associated with a collection of properties owned by RedSky Capital,

Organizers of the annual MIPIM conference have notified attendees that the event will now take place in September, after the coronavirus curtailed plans for two earlier dates. The event will also be moved to Paris and span two days as opposed to the planned four. A virtual component for attendees — MIPIM Connect — will launch in April. “It is clear that holding a large MIPIM tradeshow in Cannes in June is not feasible given

The Moguls are on the move. As coronavirus cases surge in New York City, the super rich are decamping for the Hamptons, setting off a spike in demand and pushing rental prices to levels normally not seen until the summer. And brokers dealing with this off-season demand have some wild tales to tell. Nest Seekers International’s Dylan Eckardt told the Wall Street Journal about a well-heeled client getting in touch this month. “I got this

Luxury retailer Neiman Marcus Group is reportedly considering filing for bankruptcy as it struggles with $4.3 billion in debt. No plan has been finalized, but Neiman Marcus has held discussions with lenders about a possible bankruptcy loan, according to Bloomberg. The lifeline would allow the company to continue operating while it puts together a recovery plan. The situation could change, sources familiar with the matter told Bloomberg. It will depend on the market conditions and

New York City condos and co-ops can look to the courts when neighbors don’t abide by social distancing or quarantines, some lawyers say. The state has barred public and private gatherings and ordered everyone except those working in essential businesses to mostly stay home. Health officials advise anyone with Covid-19 symptoms or who’s been exposed to someone who’s tested positive for coronavirus to self-quarantine for 14 days. But not everybody takes those directives the same

In a new episode of TRD Talks Live, sponsored by Watchel Missry, Amir Korangy will talk with Michael Shvo, founder and CEO of eponymous development firm SHVO. The developer, whose portfolio includes 4.5 million square feet of real estate, led a partnership to acquire San Francisco’s iconic Transamerica Building in February. And back in September 2019, he acquired New York’s Coca-Cola Building with Serdar Biligili. On Monday, a group of major NYC developers considered the

Edward J. Minskoff Equities has purchased a property in Dumbo that was recently rezoned to accommodate a 200,000-square-foot office building, according to property records and sources familiar with the deal. The real estate firm bought 35 Jay Street for $61.5 million from the Forman Group of Companies. The Forman family had owned the site since 1974, property records show. “We’re pleased to have closed despite the unusual times that we’re in,” said Forman Group principal

Real Estate Board of New York President James Whelan says the coronavirus has transformed his role into “crisis management seven days a week.” Whelan spoke with The Real Deal this week about what guidance the trade group is providing its members and how the real estate industry is adapting to new restrictions on business. Due to an executive order signed last week by Gov. Andrew Cuomo, brokers must conduct showings of apartments or commercial space

U.S. markets started Wednesday with a burst of optimism, as a $2 trillion stimulus deal had been reached between the White House and Congress. But as the day went on, the proposed legislation became mired in new disputes about unemployment benefits and assistance to corporations. In any case, this historic legislation — the largest stimulus package in U.S. history — would have contained few clear wins for the real estate industry, or even for renters,

UPDATE, March 26, 11:05 a.m.: Covid-19 has been battering real estate investment trusts, some of which have had to shut down hotel, mall and other properties to prevent the spread of the virus. The closures have strained the cash flow of those companies, which are required to pay out the vast majority of their taxable income to maintain their REIT designation. The financial challenges caused by the new coronavirus is causing some REITs to change

An LLC associated with the popular “Sleep No More” production at New York’s McKittrick Hotel has notified the state of layoffs. Callers to the hotel are greeted with a recorded message that says, “We are disappointed to announce a government-mandated hiatus … All performances will be suspended through April 12.” In a filing to the Department of Labor, “SleepNoMore N.A. LLC” said it had laid off nine employees because of “unforeseeable business circumstances prompted by

A month before the closing date, commercial broker Jaime Sturgis just had to kiss goodbye a nearly $1 million multifamily deal. Sturgis, founder and CEO of Fort Lauderdale-based Native Realty, said he represented the seller of an eight-unit apartment building in Miramar who canceled the sale after the buyer requested “unreasonable concessions” tied to the economic fallout from the coronavirus pandemic. “The buyer was asking for security deposits from all the tenants to make sure

The reporters behind The Real Deal’s coverage of layoffs at Compass and a bold rent-relief bill in New York joined — by video conference — Associate Publisher Hiten Samtani for a deeper discussion of the two stories. E.B. Solomont, who was first to report the layoffs, and Georgia Kromrei, who wrote about the rent bill after interviewing its sponsor, explain what led to the two developments and their implications in the above video.

New development condo report Brooklyn • Inventory contracted as developers filed fewer units than were purchased • Developers filed six plans with 27 units • The state approved 0 plans for sale • Buyers purchased 130 units valued at $105 million Queens • Inventory contracted as developers filed fewer units than were purchased • Developers filed three plans with 80 units • The state approved 0 plans for sale • Buyers purchased 91 units valued

The coronavirus pandemic has awakened the greatest sense of civic responsibility the country has seen since World War II, even as the best response to it — isolation — is diametrically opposite that of prior crises, according to RXR Realty CEO Scott Rechler. “In other past crises, what we’ve done is we like to go right to the epicenter, whether it was 9/11 or Superstorm Sandy, and be there engaged and try to help,” the

The hotel industry suffered another devastating week, as cities like New York and San Francisco saw more than eight out of every 10 hotel rooms sit empty. Occupancy levels in those two cities plunged more than 80 percent last week as the Covid-19 pandemic obliterated demand for hotel stays, new figures released Wednesday by the hospitality data firm STR show. Across the United States, occupancy fell on average by more than half to roughly 30

In mid-February, Simon Property Group announced it would acquire Taubman Centers after a nearly two-decade-long dance between the two rival mall owners. But as Covid-19 raced around the globe, bringing municipalities and states to a standstill, Simon and Taubman announced that they would temporarily close their properties to slow the contagion. The news has shaken investors, who have been concerned about the deal moving forward, analysts said. The transaction is set to close later this

TPG Real Estate Finance Trust is one of several nonbank property lenders feeling the squeeze as markets fall. Real estate investment trusts, hedge funds and private equity firms that have issued billions in construction loans, mortgages and bonds backed by property debt are now facing a cash crunch, the Wall Street Journal reports. TPG is delaying its first-quarter dividend payments in preparation for needing additional cash collateral, but the company noted in a statement that

Last week, The Real Deal publisher Amir Korangy sat down for another episode of Coffee Talk with luxury hospitality group SBE’s Sam Nazarian and leading architect Kobi Karp. This time, though, coffees were kept at home, with Karp and Nazarian joining TRD for a virtual conversation. Nazarian detailed the difficulty in maintaining his large workforce, which includes over 7,000 employees in the United States who are unable to work. “Every one of our hotels are either

Where would you rather be holed up, in a Manhattan apartment or a country home? If it’s the latter, you’re not alone. New data from Airbnb analysis website AirDNA shows travelers are fleeing cities for rural and coastal areas as the coronavirus sweeps across the U.S. In most of Manhattan, where cases have surged in recent weeks, Airbnb revenue has fallen 66 percent from the same time last year, the report said. Meanwhile, rentals in

Big chain retailers and restaurants are putting their landlords on notice. Both U.S. and international chains are informing their landlords that they need to reduce rent or cut payments, Bloomberg reported. Last week, Mattress Firm, which has about 2,400 stores, initially sent a notice to landlords offering to extend its leases in exchange for a break on rent. But this week the chain sent a second notice walking back its previous offer and informing landlords

Since entering the Israeli bond market in 2015, the Related Companies has been one of the blue-chip U.S. firms of the Tel Aviv Stock Exchange, largely immune to the swings other issuers have experienced. But with just six months until its bonds are due to mature, questions are being raised about whether Related’s Tel Aviv subsidiary will survive the coronavirus crisis and prolonged economic uncertainty. The bond-issuing entity, Related Commercial Portfolio, reported an operating capital

WeWork is trying to keep its locations staffed by offering a $100-per-day incentive. The co-working company has left many of its locations open, arguing that some of its tenants provide essential services. Now, WeWork is now trying to entice its employees to show up with a daily $100 bonus, the New York Times reported. The internal memo obtained by the Times promised employees that they would get paid the bonus for all days they worked

UPDATED, March 25, 1:40 p.m.: The city of Miami issued a shelter in place order late Tuesday that went into effect just before midnight, marking the latest city in Florida to make the drastic move. The city ordered all residents to stay at home to help reduce the spread of Covid-19. The order allows residents in Miami – which includes Coconut Grove, downtown Miami, Wynwood, Edgewater, Little Havana and other popular neighborhoods – to travel

Nearly 450 homes were pulled off the market, new listings plummeted and contract signings sank in New York City last week as the coronavirus pandemic worsened. Data firm UrbanDigs compared the number of yanked listings, signings and new listings last week to the number in the same period a year ago to see how hard the city’s health crisis is hitting residential real estate. A brutal picture emerged. New York began shutting down March 16

The economic impact of coronavirus has hit Realogy — but not in the form of layoffs. The brokerage giant will temporarily cut the salary and work week of a “majority of our employees,” the company disclosed in a regulatory filing Wednesday. The parent company of the Corcoran Group, Coldwell Banker and Sotheby’s International Realty will also pull back on marketing expenses and delay investments in certain strategic initiatives as it grapples with the economic fallout

It may be the first New York trophy trade to be scuttled by the coronavirus. Jacob Chetrit’s $815 million deal to buy the former Daily News Building in Midtown from SL Green Realty is off after Chetrit’s principal lender, Deutsche Bank, backed out, the Wall Street Journal reported. Andrew Mathias, president of SL Green, confirmed to the newspaper that the sale is no longer on the table, and said that the real estate investment trust,

One called for a total shutdown of business. Another advised startups to plan for zero revenue for six months. And a third had harsh words for impatient lenders. All three New York developers, Miki Naftali, Ryan Freedman and Steve Witkoff, made their views known about how they would deal with the deepening coronavirus pandemic. The trio spoke with The Real Deal’s Hiten Samtani as part of a live series of webinars in which TRD discusses

Two Manhattan politicians are calling for measures to give renters and landlords a respite. Assembly member Harvey Epstein proposed a bill Tuesday that would cancel this year’s Rent Guidelines Board rent increases and freeze rents on rent-regulated apartments until next June. Separately, Manhattan Borough President Gale Brewer and her Brooklyn counterpart Eric Adams, along with two City Council members, called on landlords to let tenants use their security deposits to pay rent. “Right now we’re

Roughly a year ago, the real estate industry successfully lobbied to thwart what its leaders said would be a devastating new tax. The pied-à-terre tax would have slapped an annual excise of up to 4 percent on the value of second homes worth more than $5 million. Gov. Andrew Cuomo and the legislature — with the industry’s blessing — ultimately passed one-time transfer taxes instead. But the PAT tax could make a comeback this legislative

Lyric, the Airbnb-backed hospitality startup, is drastically downsizing — just a month after laying off 20 percent of its staff. With the coronavirus pandemic bringing travel to a standstill, the San Francisco-based company gave pink slips to the majority of its 100 employees on Friday, sources said. A spokesperson for the company confirmed that 80 percent of Lyric’s staff was told that if the macro economic environment doesn’t change in two months, the company cannot

Stanley Chera, the founder of Crown Acquisitions and one of New York’s biggest retail landlords, has been hospitalized in the midst of the coronavirus pandemic. Chera, 78, was taken from his summer home near Deal, New Jersey to New York Presbyterian/Weill Cornell Medical Center, with an unknown illness, the New York Post reported. The developer is a close associate of President Trump, who had advised him to leave New York and spend time in Deal

The White House and Senators came to terms early Wednesday on a roughly $2 trillion stimulus measure – the biggest of its kind in U.S. history – aimed at delivering emergency financial support to businesses and individuals reeling from the coronavirus pandemic. “This is a wartime level of investment into our nation,” Senate Majority Leader Mitch McConnell (R., Ky.) said after a deal was struck. “The men and women of the greatest country on Earth