Columbus Square
One could forgive Larry Silverstein, as he stood inside his new Silver Towers luxury rental complex on Manhattan’s West Side and was asked by The New York Times how he planned to fill it with tenants, for saying, “Beats the hell out of me.” After all, launching two 60-story glass skyscrapers— 1,359 apartments in all—in one of the worst real estate markets in recent memory, in an off-the-beaten-path location at 42nd Street and 11th Avenue, sure sounds like a challenge.
But the cagey 78-year-old Silverstein, who spends much of his time tussling with bureaucrats over the future of Ground Zero (where he controls the lease for the World Trade Center), knows that bad news for the real estate market doesn’t always mean bad news for the rental market. During unsteady times, buyers are more likely to wait on the sidelines until they feel housing prices have bottomed. In the meantime, they rent. At the start of the busy summer rental season, the Citi Habitats brokerage estimated the Manhattan rental apartment vacancy rate at an already minuscule 1.72 percent (the national vacancy rate hovered around double digits).
“I decided to build a rental project because I believe in a long-term view,” Silverstein tells Gotham, pointing out that most developers favored condominiums during the recent building boom because they provide quicker returns on investments. “There is not much built in New York by way of rental housing, especially luxury units.” And Silver Towers— with its art-filled lobbies, outdoor groves, spalike amenities, attended parking and rents ranging from $2,300 per month for studio apartments to $8,000 for some penthouses— is certainly luxury. But it’s also not the only new game in town.
Manhattan has recently seen a wave of rental properties opening for business with condolike décor and services. Rivaling Silver Towers in its everything-including-the-kitchen-sink mentality is Columbus Square, 710 apartments spread over fi ve new buildings on a formerly barren stretch of the Upper West Side. In addition to a 70-foot saltwater pool, acres of landscaped rooftop space and apartments loaded with washers and dryers, Whole Foods and other retailers are also on board.
“New York City needs rentals, and people are always going to want the most for their money,” says Columbus Square general manager Jeffrey Davis. “They still like the cachet of having something new and better.”
The rental market isn’t bulletproof, of course. Since the recession set in, some neighborhoods have seen double-digit declines in prices, and incentives are common. But even though these immaculate towers were born of the boom and debuted after the Champagne ran out, that’s not necessarily a bad thing. Just call them fashionably late.
