UES residents ousted due to Second Avenue Subway construction

Residents at 1873 Second Avenue received a temporary relocation notice informing them they will have to be out of their apartments for 30 to 60 days due to construction at the adjacent building of an air vent for the Metropolitan Transportation Authority Second Avenue subway project at 1875 Second Avenue.

The letter, dated March 19, does not indicate when the residents in the 12-unit Bradford N. Swett Management-managed building between 96th and 97th streets will have to clear out of their apartments, but a spokesperson for the MTA said it hoped construction would begin some time next month (see full letter below).

"This is devastating. I don't want to move. If I move it would have to be for good and I can't afford that. I have been in this apartment for 10 years and have always paid my rent and I just can't believe something like this could happen. I heard about things like this happening in Brooklyn, but never thought it could happen to me. I know your readers are influential and I hope some of them could read this and help us," a tenant in the building, who asked for anonymity, said.

The MTA assures in the letter that it will pay for the cost of relocation, temporary housing and the restoration of their apartments.

The MTA says it will be holding a meeting for tenants to meet with O.R. Colan Associates regarding the moves.

"That building required remedial work that will improve the soil and reinforce the building," MTA spokesperson Kevin Ortiz told The Real Deal. He said the building was structurally weak because of preexisting conditions and the bottom wall was shifting.

The tenants will have to be out of the building while the basement wall is reinforced and the facade repaired, Ortiz said.

An employee at Bradford N. Swett Management, who did not want to be identified, said the MTA had not yet received approval from the company to perform the shoring up work.

Could virtual doormen replace the real thing?

Doormen of New York -- watch your backs.

James Bond-like facial- and voice-recognition programs -- cheaper than humans -- could kill the need for the uniformed doorman guarding city buildings, one security firm says.

"Imagine walking into your building -- and you are the key," said Alon Alexander of Kent Security Services, a provider of "virtual doorman" services.

Hundreds of buildings around the city are already being monitored with video cameras and audio communication instead of live doormen, according to some estimates. But Kent's addition of scanning technology, called biometrics, would take the computerized entry system further.

And the economics of man versus machine could loom large in current talks between building owners and 30,000 human doormen whose contracts expire on April 20.

Here's how the new door would work:

As soon as a tenant walks to the door of his building, a camera snaps 40 pictures of him per second and compares the images with those it has on file. If a match is found, the tenant is allowed in.

Otherwise, there's a curt greeting and the query: "Do you live in the building?" The person states his name and where he is headed, and the computer employs voice recognition that includes an emotion detector.

If the computer recognizes the voice, the person is let in. If it doesn't, central security staffers can check by phone.

Still, "no one has seen this in action yet," Alexander conceded.

He said the biometric door costs $15,000. Doormen make $40,000 a year, according to their union, 32BJ SEIU.

But "there's no replacing people with machines and maintaining the same professional service for security," argued union spokesman Matt Nerzig.

And some things money can't buy, doormen insist.

"Humans don't malfunction as often as computers do," noted Mike Zarowny, 53, a doorman at Vesta 17 in Chelsea.

West Village doorman Jamel Salty, 64, said, "A computer is not going to help tenants carry their bags."

The Renter Roadblock

At the Chelsea Modern, a new condo on West 18th Street, renters are being encouraged to become owners by a 10 percent discount.

IT seemed like a smart idea at the time.

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The apartment was lovely — new construction, three bedrooms, three and a half baths, nearly 2,000 square feet on the Upper East Side. The asking price was $2.995 million. A year earlier it would have gone fast.

But this was early 2009 and the economy was in tatters. Offers were pathetic — the best, $2.2 million. Forget it, the owners said. We’ll rent the place.

And so they did. With the approval of the condominium board, a family signed a one-year lease for $10,500 a month, with an option to renew for a second year. The owner’s expenses were covered. The plan was working nicely.

Except now the buyer who offered $2.2 million has come back — this time with an offer of $2.83 million, all cash.

“They’re coming up almost to asking price, but I can’t get the renter out,” sighed Victoria Shtainer, a senior vice president of Prudential Douglas Elliman, the real estate company. She is holding her breath until April, when she will hear whether the tenants intend to exercise their option to extend the lease for another year.

Over the past year or two, many owners who couldn’t sell — or didn’t dare try — made a similar calculation. Rather than accept an impossibly low offer (if they even had an offer), they decided to rent out their properties. The idea was to cover expenses while waiting for the market to right itself.

But in recent months, a number of these accidental landlords have been surprised to find renewed buyer interest in their properties. The problem is, the renters are happily in place. And that can complicate showings — let alone negotiating an actual deal.

A 4,100-square-foot loft on East 24th Street has sat on the market for nearly two years, despite a drop in price to $3.995 million in July 2009, from $5.535 million in April 2008.

In September 2008, the owners put the place up for rent. When their tenant moved out last summer, with no buyers in sight, they decided to rent it again, though this time the best monthly price they could get was a few thousand dollars lower.

Then last fall, shortly after the new tenant moved in, the long dry spell ended and brokers started showing up with prospective buyers in tow. Now a buyer wants to make an offer, said Gina Tramontano, the exclusive agent and a vice president of Halstead Property. But he’s saying that he will wait until the fourth quarter of the year — after the lease expires.

Ms. Tramontano said the buyer had not explained his reason for holding back. But she observed, “Once buyers hear there is a tenant, they are always concerned that the tenant won’t leave.” And that is even though the loft’s lease has a rider saying the owner can request that the tenant move out, with two months’ notice.

There are other frustrations. Whenever Ms. Tramontano wants to show the apartment, she has to have the permission of the tenants, who are not as motivated as owners to keep it in museumlike shape for viewing. When she arrives with clients, there’s often a wife, a baby and a nanny at home — and the corresponding toys and other evidence of family life.

At least she can show the place. A 19th-century seven-bedroom house in New Canaan, Conn., having failed to sell, has been occupied by a renter since Oct. 1. The lease contains a 90-day “show clause,” which means the house can’t be shown to prospective buyers until July 1 — 90 days before the lease expires.

That was not a problem when prospective buyers were nonexistent. But recently brokers have inquired about the property on behalf of two clients.

“I explained to them that you can buy it with the tenant in place until Oct.1, and I can give you photographs and detailed information about it,” said Mary Higgins, an associate broker at Halstead, who has the exclusive on the property. “But what I can’t do is open the door and let you see it.

“They say, ‘Well, if I’m still in the market in a few months ... ’ ”

The renewed interest in such properties is one indication that the New York area residential real estate market may be starting to stir. But indicators of the market’s health are still mixed. The number of condo and co-op sales in Manhattan was up 8.4 percent in the fourth quarter of 2009 compared with the fourth quarter of 2008, and it was 10.9 percent higher than the number of sales in the third quarter of 2009, according to a report prepared by Miller Samuel, the real estate appraisal firm, for Prudential Douglas Elliman.

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A loft at East 24th Street, left, has a prospective buyer who declines to bid until the tenant’s lease is up. An owner in a building in the East 80s, above, has both an offer and a tenant with an option to stay.

But prices are still slipping. The median sales price in the fourth quarter ($810,000) represented a 4.7 percent drop from the third quarter and was down 10 percent from the fourth quarter of 2008.

Outside of the city, sales numbers for January show signs of life, according to newly released statistics from the New York State Association of Realtors.

In Westchester County, for example, sales of single-family houses jumped 108 percent in January compared with January 2009. The median sale price during that time rose 12.7 percent. In Suffolk County, the number of sales grew 47.6 percent from January 2009 to January 2010. The median sales price, however slipped 0.8 percent during that time — though that was a vast improvement over the 15.7 percent drop from January 2008 to January 2009.

When renters and prospective buyers are involved, the situation is delicate. No owner or broker interviewed for this article would disclose the identity of renters or ask them if they would speak to a reporter. That’s because no one wants to upset a renter. Many owners are hoping their tenants will decline to renew their leases and leave. The last thing an owner wants is to have to pay them off in order to negotiate a deal.

Renting out an apartment may be a good way to keep the cash flowing, but there are roadblocks for owners to consider. Most co-op boards have strict rules about subletting, and some do not allow it at all. Condo boards are typically more lenient. And once renters are in place, it can be difficult to remove them, even if they stop paying rent. In New York City, you cannot evict a tenant without going to court.

In some cases, an ensconced tenant can be an amenity. Megan McGinn, an agent at Elika Associates, a firm that represents buyers in Manhattan and Brooklyn, says many of her prospective buyers are renters, with leases of their own to finish out. These buyers would welcome a tenant in place while they wait for their own leases to be up. “A lot of buyers seem to be coming out of the woodwork right now,” she said, adding that many had been inspired by the federal tax credit for first-time buyers.

Some owners are working to turn their renters into buyers.

Robert Gladstone is the sole managing member of Madison Equities, the developer of the Chelsea Modern, a condominium completed on West 18th Street in fall 2008. In the depths of the summer doldrums last year, he did something he had never done before.

With about 30 of the building’s 47 units sold and the market looking sluggish, he decided to rent out 12 units for a year or 13 months.

“He believed that once someone moved into the building they would have an impulse to say, ‘This feels like home to me’ and have the impulse to stay,” said Dan Tubb, Chelsea Modern’s director of sales.

To nurse that impulse along, Mr. Gladstone moved into the building and invited renters and owners to his apartment for a holiday party.

“We wanted the buyers to interact with the renters,” Mr. Tubb said.

Pressing further, the developer sent a letter to all the renters in January offering a deal — and doing the math to help them see its appeal. Renters were paying $6,500 a month for a two-bedroom two-bath apartment with 1,400 square feet of space. Mr. Gladstone offered the unit at a 10 percent discount from the original asking price, which dropped the price tag to $1.75 million. With 70 percent financing at current rates, the monthly mortgage payments should be about $6,300 a month. The common charge for the building is about $1,200 a month.

But the tax savings — including the mortgage interest deduction on the federal income tax and local homeowner tax relief programs — would effectively bring an owner’s net monthly payment to about $5,100, according to the letter. That would mean monthly savings of more than $1,000.

The numbers seemed to get some attention. Four or five renters have inquired about buying, Mr. Tubb said. (But he would not make any available to speak about their thinking process.)

For some owners, the sudden interest in their properties is creating a tricky new question: Do you really want the renters out, or should you keep them even longer in hopes of getting an even better offer?

Karin Posvar-Picket, a senior vice president of the Corcoran Group, represents a client who rejected a couple of lowball offers on his East Side condo and decided to rent his place out instead. Now, with the lease almost up, he has new offers — but he would rather keep the renters.

“He wants to wait another year till the market really improves,” Ms. Posvar-Picket said.

Wladimir Singer put his three-bedroom condo in the East 70s on the market for sale or rent when he moved to Monaco last spring. There were no nibbles from buyers, but the apartment rented fairly easily, with a family signing a one-year lease at $10,000 a month — almost enough, Mr. Singer said, to cover the mortgage and other costs of carrying the property.

But since the start of the year, three offers have come in, including an all-cash one for $2.8 million from a major bank shopping for its corporate officers.

“We have five to seven parties visiting the apartment each week now,” said Mr. Singer, who had not expected to receive any offers before his tenant’s lease expired. “Sometime after the holidays the interest spiked.”

All that interest has got Mr. Singer thinking: What if he waits even longer? Maybe he could get asking price ... or higher. He will learn in April if the tenants want to extend the lease for another year. If they don’t, he said, he will seriously consider the offers he has.

Or he might look for another renter.

Foreclosure looms for One Madison Park

Glitzy residential development One Madison Park is being foreclosed on before it's even finished.

A prominent commercial real-estate lender says the developers have defaulted on the mortgage and owe them over $200 million.

In papers filed in Manhattan Supreme Court, iStar Tara claims the borrowers at the problem-plagued luxury condo site have committed "numerous breaches of its obligations under the mortgages," and the company's had enough.

It wants to foreclose on the property, sell it, and get a "deficiency judgment" against developers Ira Shapiro and Marc Jacobs and their Slazer Enterprises, who had "guaranteed repayments of certain amounts owed to [iStar]."

Calls to Slazer were not returned.

When it was announced in 2008, the blue-glass One Madison Park was a hot property that attracted Hollywood stars such as Susan Sarandon, Liev Schrieber and Naomi Watts.

Then financing woes hit, and Shapiro and Jacobs found themselves mired in controversy and targeted in lawsuits by other angry lenders and buyers, including ex-Yankees Chairman Harvey Schiller and One Madison Park's ex-broker Wendy Maitland of Brown Harris Stevens.

The newest suit says the developers defaulted on interest payments, which have not been paid since September and now total over $13 million. They also didn't keep enough cash on hand to finish the 60-story building on East 23rd Street.

In an interview with The Post on Thursday, Shapiro acknowledges there were "issues" with iStar, but said, "we are hoping to resolve them." iStar didn't return calls about what Shapiro had characterized as 11th-hour talks.

The suit says there are a dozen judgments, liens and lawsuits pending against the property. The on-site sales and marketing office has been closed for at least the past week, sources said.

The suit said the foreclosure action would not affect condos that were sold by the developers with iStar's OK.

15 Madison Square North loft bid up to $12M from asking price of $9.5M

Dubbed by its listing as "the superlative apartment in a building filled with apartments beyond compare," the 17th-floor loft at 15 Madison Square North must indeed be something. Otherwise, it would be tough to explain the 2007-like bidding war.

According to city records, hedge funder Anand Desai and wife Erica recently paid $12 million for the 14-foot-high-ceilinged, freshly renovated apartment on the edge of Madison Square Park. A high price, but not that unusual for more than 5,000 square feet of loping loft space.

The catch was that an earlier listing price pegged the condo at $9.95 million, chopped from an original early 2009 asking price of $13.5 million. Was the $2 million-plus jump from $9.95 million to the closing price of $12 million a typo or evidence of a high-flying bidding war, the sort not common in these parts since Lehman Brothers went kaput in September 2008?

The latter proved to be true.

Corcoran Sunshine Marketing Group was reticent to comment on whether, in fact, there was a bidding war showdown in Madison Square Park. Tricia Cole, the group's executive managing director, said only that she was not currently in a position to comment. But the group did offer the following official explanation: "Listed early in 2009 at $13.5 million, the price was later reduced in order to draw a larger audience of interested buyers. In this case, our reduced price generated significant interest and multiple bidders for this wonderful home, which in the end drove the price back up. As is always true in an efficient market, the market ultimately sets the price."

And apparently the market was hopping. "This really does show the efficiency of the market," said Louise Phillips Forbes, a top broker with Halstead who was not involved in this particular deal. She was speaking generally about an uptick in bidding wars in New York. "The market is catching up. The truth is, maybe not across the U.S, but in New York proper, where our economy is responding to all of the efforts that have been put into helping it, I am seeing bidding wars at every scale. This is what we are dealing with for great, unique properties."

In 2006, the top 12 floors of the 20-story office building at 15 East 26th Street were converted to deluxe residential condos. Officially known as 15 Madison Square North, the converted residential floors are almost sold out, according to Ms. Cole.

All have views, of course, of the wholesale district north of Madison Square Park and east of Broadway that is one of the only unnamed neighborhoods on those taxi maps of Manhattan. However, an overhaul of this neighborhood's image is swift underfoot-one hotelier has tried to make the acronym NoMad (North of Madison Square Park) stick as a new Tribeca. Which begs the question, evinced by this $12 million deal borne of an apparent bidding war: Has NoMad started to settle down?

2010: The Year of the Renter?

SCORES of stalled construction projects can be found scattered around New York City, but one category of building that doesn’t seem to have been sidetracked by the recession is the luxury apartment rental.

Some of the new buildings that will add at least 7,000 apartments to the city’s housing stock.

At least 16 new rental buildings are expected to open in Manhattan in coming months, ranging from small buildings to 500-unit high-rises, for a total of more than 3,500 apartments. Brooklyn will get an additional 3,500 new apartments as well, including units in some buildings that opened in late 2009.

While 7,000 new apartments is a relatively small number for a city where 70 percent of 8 million residents live in rentals, many of the new buildings are concentrated in just three neighborhoods: Manhattan’s Hudson Yards area, downtown Brooklyn and Williamsburg.

These apartments are becoming available at a time when average rents are down by about 25 percent from the market’s height in early 2008; vacancy is close to 2 percent, compared with just under 1 percent in 2007 and 2006; and the city is still losing jobs. As a result, the new buildings are offering a range of incentives to lure tenants, including one to five months of free rent, free gym memberships, American Express gift cards and even free iPods.

The new buildings, with all their enticements, will most likely set off another round of apartment musical chairs — first seen in 2009 — in which many renters with leases coming up will try to move to fancier buildings or better deals.

Rents have already dropped to the levels they reached in 2000, and the influx of apartments is expected to keep them there. New studios in the Hudson Yards area could start at $2,000.

“The opening of new buildings is really going to be the keynote of 2010,” said David J. Wine, a vice chairman at the Related Companies, which owns and manages about 5,000 rental units in New York City, but does not have a building opening this year. He said that Manhattan had not had to absorb this many new market-rate apartments in more than a decade.

But after the surge of new buildings in 2010, Mr. Wine and other rental developers said, rental construction in the city will hit a lull. “After these buildings are completed, there’s going to be nothing, because banks stopped financing,” he said, referring to the credit crunch that started in late 2008 and has hit developers and home buyers equally hard.

“Nothing” may be a slight exaggeration, since Related hopes to open a new building on 10th Avenue and 42nd Street in 2011 and has eventual plans to build some 5,000 units directly over the Hudson Yards.

But Robert Scaglion, the managing director of residential marketing for Rose Associates, thinks the “nothing” assessment is about right. “This is going to be the end of all the rental developments that were planned three to five years ago,” he said. “And after this group hits the market, there’s not going to be much else.”

Rose is managing two Williamsburg buildings that are to open soon — 184 Kent, a 338-unit converted warehouse, and 34 Berry, a 140-unit building.

As developers work to fill their new buildings in 2010, Frederick S. Harris, a senior vice president for development at AvalonBay Communities, said that “you almost by definition have to have a pause.”

Avalon just opened Avalon Fort Greene, a 630-unit unit building that is actually in downtown Brooklyn.

“We will be delivering Avalon Fort Greene through most of this year because it’s such a large building,” Mr. Harris said. “And this will be our last delivery for a while.”

Avalon has plans for another rental tower in West Chelsea but is not likely to break ground there until next year.

Although new buildings will open throughout the city in the coming months, the largest concentration will be in neighborhoods that developers had pegged as the latest frontiers.

In the Hudson Yards area, which is bounded by 30th Street, 42nd Street, Eighth Avenue and the Hudson River, four large projects have started or will soon start leasing apartments: Silver Towers, two 60-story glass towers with nearly 1,000 market-rate apartments built by Silverstein Properties; Emerald Green, a 569-unit project developed by Glenwood Management; Ohm, a 288-unit building from Douglaston Development; and 505 West 37th Street, two towers with 835 units developed by TF Cornerstone.

The number of new apartments expected for downtown Brooklyn in 2010 is no less extensive: the 650 units at Avalon Fort Greene; 365 units at 80 Dekalb, a 36-story tower built by Forest City Ratner; 512 units at Brooklyn Gold, a project of Lalezarian Developers; and 491 units at the Brooklyner, a 51-story tower from the Clarett Group.

Developers and brokers say that rental activity has been strong at buildings that opened in late 2009. But some community leaders are skeptical.

Andrew Berman, a member of the Hudson Yards Community Advisory Committee, said, “The market is simply not there for them, and the only way they’re filling apartments is by doing things that they never intended to do, just to get tenants.”

The neighborhood, Mr. Berman said, is “not equipped to handle this flood of product.” He pointed to “insane traffic, lack of public schools and lack of an affordable, full-service supermarket.”

Mr. Harris of Avalon said that while it would have been much easier to fill buildings in a stronger economy, he did not see the surge of new units in downtown Brooklyn as a problem.

“Having four buildings come on line at the same time can be a good thing when you’re in an emerging neighborhood,” he said. “People won’t think: ‘Why is this guy here? Did he make a big mistake?’ ”

Instead, he said, there’s “a sense that the neighborhood is really changing.”

The new buildings have amenities meant to appeal to 20- and 30-somethings — swimming pools, expansive gyms, screening rooms, large roof decks, game rooms with pool tables or arcade games. For incentives, landlords are paying brokers’ fees and offering one or two months’ free rent on 14-month leases, and as much as five free months on two-year leases.

Developers generally have already reduced their original projected monthly rents by a minimum of 10 percent. But the sales pitch often revolves around “net effective rent,” which takes free rent into account to bring the number down further. That could mean net rent for a studio starting at $2,000 in the Hudson Yards area and about $1,400 in downtown Brooklyn. The average rent for Manhattan studios in the last quarter of 2009 was $2,253, according to Prudential Douglas Elliman.

“Everybody is competitive in terms of giving incentives,” said Clifford Finn, the managing director of new development marketing for Citi Habitats, “but with everybody giving about the same, it puts you back in an apples-to-apples comparison, so it comes back down to location and the actual product.”

As for free iPods, offered to people who signed leases at 60 Monitor Street, a 60-unit building in Williamsburg, they were attention-grabbers pure and simple. “Differentiating yourself is half the battle,” said David Maundrell, the president of aptsandlofts.com, which has the listing. Other incentives included a month of free rent and no broker’s fee.

“Once you get them in the door, they still come prepared to negotiate,” Mr. Maundrell said. “If there’s one or two months free, people are asking for $50 off on top of that, and in a rollout, we try to look at every deal and we’ll consider it.”

The carefully baited hooks are apparently working. The northern tower of Emerald Green offered one to two months’ free rent and was 80 percent rented in the three months between Labor Day and Christmas, a traditionally slow time of year. The same offer at the much larger Silver Towers resulted in the leasing of about 400 apartments, or 40 percent, since it opened last May.

The promotions at new buildings will undoubtedly also help keep prices down elsewhere in the city. Marc Lewis, the president of Century 21 NY Metro, estimated that rents had dropped to 2000-era levels. He said they were not likely to climb anytime soon.

“Landlords don’t want to publicize it,” he said. “But if something is listed at $2,100, a tenant will offer $1,900 and maybe they’ll settle on $2,000, with possibly a free month thrown in, plus the landlord pays the commission.”

Still, Chris Albanese, a principal of the Albanese Organization, which has rental towers in Chelsea and Battery Park City, said he didn’t think the new inventory would directly compete with his buildings.

“Are some people coming in and saying, ‘I can get two months’ free rent and the rent is only $2,200 over there’? Of course,” he said. “But we’re not going to drop from $3,200 to $2,200. You can’t walk into a Honda dealership and walk out with a Mercedes. And most people know there’s a difference between a prime neighborhood and a secondary one.”

Mr. Finn of Citi Habitats says the people attracted to the new developments include renters trading up from no-doorman buildings or walk-ups in the city. But he also says the new tenants are New Jersey or Queens residents who previously felt priced out of Manhattan. He said that the percentage of renters coming from outside Manhattan had increased to 30 percent from 20 percent in the last year.

But until new jobs are created to bring in a new pool of renters, it will continue to be a renter’s market, said Marisa DiNatale, a director at Moody’s Economy.com. “You won’t see pricing power for landlords return until there’s a strong recovery of the economy,” she said.

By most accounts, New York’s employment outlook is better than initial predictions, but recession-generated job loss is still not expected to stop until mid-2010. The New York City Independent Budget Office has scaled back the anticipated job loss to 157,200, from 254,500, and predicts employment will start growing again this summer.

“But some sectors, such as finance, we don’t think are going to turn positive again until 2012,” said Douglas Turetsky, the budget office’s chief of staff. “So even though we’re going to start seeing new jobs in sectors like leisure and hospitality, what those jobs pay may not quite match the rent levels for the new buildings that are coming on line.”

Brokers and analysts have long predicted that many of the stalled construction projects around the city are condo buildings that will eventually be converted to rental buildings. But so far, few buildings have taken this step.

Mr. Scaglion of Rose said that 184 Kent was intended to be a condominium, but that the developer, JMH Development, decided to make it a rental during construction when it became clear that condos in the area were not selling well.

Still, Mr. Scaglion said, condo buildings for the most part are not easily turned into rentals because they have “high-end finishes that don’t wear well with rental tenants, and there’s usually no back of house, no shop or staff to fix and renovate apartments.”

Nor do most condo developers want to become rental owners; they would rather renegotiate their construction loans so that they can cut prices and sell out their projects.

Stephen Kotler, a director of rentals for Prudential Douglas Elliman, said that many developers of stalled projects had avoided foreclosure only because they had been able to keep current on their construction loans by spending “interest reserves” negotiated as part of their initial loan packages. “But a lot of those reserves are going to start running out midyear,” he said. “And that’s when you’re going to see more condo projects becoming rentals.”

Some investors are betting that the wind will continue to blow in a renterly direction. A venture called Condominium Recovery was recently formed to buy distressed condo projects and rent them out for a minimum of three to four years before selling them as rental buildings.

Jonathan J. Miller, the president of the appraisal firm Miller Samuel and a partner in Condominium Recovery, says that the plan is to introduce about 2,500 new rental units to market starting in 2011. That is just a fraction of the city’s estimated 22,000 “shadow” condo units: unfinished apartments in stalled buildings, or completed units not yet listed for sale.

But if other companies also convert condos into rentals, Mr. Miller said, the new inventory could “continue to press rental prices down.” Even so, he said, “the three- to four-year outlook for New York City rentals for developers is still probably more favorable than the outlook for luxury condos.”

Move-In Day Is Not Carved in Stone

CONSTRUCTION delays are part and parcel of any new development, so it should come as no surprise that if you’re signing a lease in a brand-new rental building, a firm move-in date can be elusive.

Developers sometimes lease apartments before they have received final permits from the city. So if a building is still under construction, potential renters should ask whether the unit they hope to move into has a certificate of occupancy. If it doesn’t, they should be prepared for delays.

At Brooklyn Gold, some renters were told that they could move in on Dec. 1, 2009, but that date has moved several times; the first move-in is now scheduled for Feb. 1. And at Avalon Fort Greene, move-in dates for about a dozen people were delayed by about a week late last year. Both buildings have compensated renters who were inconvenienced.

Frederick S. Harris, a senior vice president for development at AvalonBay Communities, says that apartments are leased about a month in advance of the anticipated receipt of building department approval.

“We had to push back the first group of people because the certificate of occupancy was later than predicted,” Mr. Harris said. “We try very hard to time it right, but when you’re leasing in advance, sometimes you get it wrong.”

Buyers forfeit deposits at new developments

Fifth on the Park rendering

Some buyers of new condominium units are being forced to walk away from their deposits because the mortgages they lined up before the credit crisis are no longer available, and they can't get financing. Near closing dates, some banks are requiring buyers to put additional money up for the down payment if they want a mortgage. For conforming loans in New York City, banks are now requiring at least 20 percent down, and for jumbo loans, lenders want down payments of as much as 50 percent. Some buyers are suing the developers of new buildings for their deposits back. "If I knew this, I would never buy this apartment," said Louis Andriopoulos, who put down $100,000 for a two-bedroom at Fifth on the Park in 2007, but lost mortgage approval. "Ten percent used to be more than enough [for a down payment] and I never had a problem with financing before."

Tribeca Live/Work Loft 2500 SQFT W/D April 1st

Tribeca Live/Work Loft - 2500 Square Feet

For showing times, please contact JAD Realty Group:

Jeffrey Ditri - 610.781.8417

LOCATION:

Tribeca / Franklin Street

DESCRIPTION:

Well maintained, elevator building

Third floor unit

Separate gourmet kitchen including granite counter tops and new appliances

Modern bathroom, new fixtures

Large living Space featuring a double exposure view

Corner unit

Each bedroom can fit a queen size bed and extra furniture

Two storage closets with extra loft storage space

15' high ceilings

Southern and eastern exposure view

Original hardwood plank floors and steel columns

Excellent Tribeca location; near all transportation, restaurants, downtown, the East Village, the West Village, Soho, and Union Square

TRANSPORTATION:

4,5,6,1,A,N,Q

LISTED RENT:

$6,495

CONTACT:

Name: Jeffrey

Phone: 610.781.8417

Tribeca Live/Work Loft - 2500 Square Feet

For showing times, please contact JAD Realty Group:

Jeffrey Ditri - 610.781.8417

Housing stock up, vacancy rate down

New York City now has over 3.33 million units of housing stock, the highest number since 1965, and the number of units increased in all five boroughs between 2005 and June 2008, according to preliminary results of the 2008 New York City Housing and Vacancy Survey, released yesterday. New York City's rental vacancy rate was 2.88 percent between February and June 2008, down from 3.09 percent during the same period in 2005. Because the survey includes data only through June, it does not address the impact of the financial crisis on city real estate. The number of rent-stabilized units fell by 17,000 since 2005, the study found. The number of people paying more than 50 percent of their income for rent was 29.4 percent, compared to 28.8 percent in 2005. The survey is conducted every three years and is required by city and state rent-regulation laws. 

All eyes on rentals now

From the February issue: New York City has always been a town of renters. But in the last few years, it was easy to forget that fact, with condo towers selling out in a matter of days and the average price of a Manhattan apartment peaking at a record $1.7 million in the first quarter of 2008, according to Prudential Douglas Elliman. For a time, everyone wanted to own New York real estate, and every broker wanted to sell it. Now that the ensuing wave of job losses has made buying property impossible for many New Yorkers, rentals are suddenly back in vogue. "I wouldn't want to be selling condos now," said Richard LeFrak, the chairman, president and CEO of the LeFrak Organization, one of the biggest rental landlords in the New York City area. LeFrak will soon begin marketing a new 33-story rental tower in Jersey City called Aquablu. Occupancy is set for May or June.

Repricing accelerates for Manhattan office market

Number of blocks of space in Midtown with dramatic rent cuts quadruples

Asking rent reductions that accelerated through the fourth quarter of 2008 continued in January, with prices down by as much as 30 percent from the peak last summer, commercial brokers said.

The number of blocks of space in Midtown with dramatic price cuts quadrupled between September and December, according to a CB Richard Ellis report released last month.

Tenant representative broker Norman Bobrow said he saw repricing all over Manhattan. "This has been going on since September of last year but has accelerated, really accelerated, in December and January," he said. He estimated prices had fallen back to levels last seen in 2005.

The optimism from the inauguration of President Barack Obama on Jan. 20 was quickly dampened two days later by a crushing jobs report that showed the city shed 8,500 private jobs in December and the unemployment rate rose to 7.4 percent, Glenn Markman, executive director at Cushman & Wakefield, said. Each office job loss equates to a loss in demand for about 250 square feet.

Despite the bad news, leasing negotiations have picked up from the near standstill in the fourth quarter of 2008.

"The market had to reduce [prices] because it was too expensive," said Markman, who estimated prices were off 20 to 30 percent from last year's highs.

As an example, he said, in late January he was negotiating a lease with a landlord in a Midtown building who had been seeking as much as $80 per square foot. The tenant occupies the space on a sublease, paying about $50 per foot. But as the economy declined, the landlord reconsidered its high price and will likely settle for about $55 per square foot, or a 31 percent cut from the asking price.

"Look what the landlord gets: certainty," Markman said. "He does not give [tenant improvement] or free rent ... and no downtime for leasing."

Howard Rosenblum, a leasing agent and director at commercial property landlord Kaufman Organization, said owners were aggressively cutting prices by about 20 to 25 percent to attract tenants. But, he said, tenants were still holding off.

"A lot of people are thinking it is going to drop more and don't want to commit," he said. Tenants do not want to pay the steep security deposit and some wonder if they will still be in business in the coming years.

But some tenants who do negotiate are signing leases with prices that are below the rents they paid in the final years of a long-term lease, he said.

Neal Lerner, an independent tenant representative broker who works in the 5,000-to-15,000-square-foot range, said tenants willing to sign leases were opting for shorter terms, like two, three or five years. The bet is that rents will be even lower on the expiration of the lease, and they will get a better deal at that time.

"People tend to stay in place and negotiate shorter commitments from landlords," he said. "They are waiting for a better time when they can take advantage of lower rentals on a long-term basis."

Midtown

Landlords in Midtown have tripled the amount of space aggressively discounted in their hunt for tenants, slashing prices in December by an average of 19 percent, CBRE reported. The quantity of sites being repriced quadrupled from 30 in October to 134 in December, representing 1.74 million square feet that month, the report said.

Despite the steep reductions, the average asking rents dropped by only $1.98 to $78.89 in December, and vacancies rose 1 point to 7.6 percent, the data said.

Some landlords were holding firm in pricing. Bobrow said there were Class A landlords in Midtown who were reluctant to sign leases at discounts. The building owners sought to maintain the high rents in the office towers so that larger tenants negotiating a lease renewal could not point to lower rents and ask for a similar discount.

Landlords "don't want to inch down, they want to hold on to the renewals" at the high prices, he said.

Midtown South

Midtown South had its slowest month in leasing velocity since May 2001. Just 80,000 square feet was signed, representing only 20 percent of the five-year rolling average, CBRE said. The anemic month capped the weakest year since 1993. In 2008, 2.58 million square feet was leased, a level 40 percent below the total for 2007, the data showed.

The district saw vacancies rise in December by 1 point over the month earlier to 8 percent, but asking rents remained steady, dropping just $0.03 to $52.43 per square foot.

Downtown

Leasing activity Downtown remained flat while prices declined moderately, in the only one of the three office markets to see positive absorption, the CBRE data showed.

The district had a net absorption of 270,000 square feet, but for the full year the area had a negative absorption of 1.59 million square feet, compared to a positive absorption of 1.33 million square feet in 2007, according to CBRE.

Average asking rents fell from November to December by $1.51 per square foot to $47.68 per foot, while vacancy rates were steady at 7.4 percent.

Markman said brokers were keeping a close eye on three financial firms that occupy 7.5 million square feet downtown — Bank of America, Goldman Sachs and American International Group.

Bank of America is absorbing Merrill Lynch, Goldman Sachs is moving to a new headquarters in 2010 and AIG may sell some of its buildings for residential use.

"Depending on what the companies look like a year from now, that will have an effect on the marketplace," he said.

Biggest price cut of the day

770 Park Avenue, #14B

The unit with the biggest price cut today in Manhattan is a two-bedroom, three-bath co-op at the Rosario Candela-designed 770 Park Avenue, according to Streeteasy.com. The apartment, unit #14B, was cut by $2.4 million and is now listed for $7.5 million, down from its $9.9 million listing. The apartment was originally put on the market at $10.95 million in May 2008, and cut to $9.9 million in September. Brown Harris Stevens' Nancy Elias and John Burger are listing the unit, which also has a 45-foot terrace. The $2.4 million cut from the unit is almost double the average price of a co-op in Manhattan, which was $1.21 million in the fourth quarter of 2008, according to appraisal firm Miller Samuel.

Meanwhile, the most expensive unit to come on the market today is a $9.35 million condo at 151 East 58th Street, One Beacon Court. The 2,410-square-foot unit has three bedrooms and three baths. Brown Harris Stevens' Linda De Luca and Corinne Vitale are listing the unit. On Monday, a One Beacon Court unit had the biggest price cut of the day. 

Luxury stores can't afford Madison Avenue

“For Rent” signs, like this one at 753 Madison Ave., are becoming a familiar sight along the avenue’s “Gold Coast.”

After more than 30 years on Madison Avenue, the retailer E. Braun & Company is packing up its $3,500 hand-embroidered tablecloths and $2,390 bedding sets and will defect in April for cheaper space on Park Avenue.

And it is not alone. New York’s most elegant shopping corridor, the Gold Coast of Madison Avenue, from 57th Street to 72nd Street, is pockmarked with vacancies as retailers flee sky-high rents. More than two dozen retail spaces are on the market and are either empty now or about to be. Windows that once showcased hand-tooled leather suitcases are now plastered with for-rent signs.

“This is as bad as I’ve ever seen it,” said Alan Victor, a broker who has worked the street for more than four decades and who is an executive vice president of the Lansco Corporation.

Another broker, Gene P. Spiegelman, an executive director at Cushman & Wakefield, said that 13 percent of the retail spaces on Madison Avenue were available either as a direct lease or a sublet. Not included are those with tenants who would move if the right offer turned up.

“There are tenants that say, ‘If you get me a good sublease, I’ll take it and run,’ ” said E. William Judson, a broker who is also the chairman of the Madison Avenue Business Improvement District, a group made up of property owners and retailers. “Some people are thinking, ‘Maybe I’ll either downsize or I’ll close the store.’ If they have a lousy day, they say, ‘Let’s get out of here.’ If they have a good day, they say, ‘Let’s stay.’ ”

Lately, the people who sell $2,400 leather bags and $1,600 satin-and-rhinestone evening sandals are more likely to have bad days. Of all retail chain categories, luxury stores had the greatest decline in sales in 2008, falling 7.5 percent from 2007, according to the International Council of Shopping Centers, a trade group. From 2004 to 2007, by contrast, the luxury sector outperformed all other categories by a wide margin.

The recent holiday season was the worst in four decades for the retail industry. Sales at Neiman Marcus’s specialty division, which includes Bergdorf Goodman, declined 31.2 percent. Tiffany reported that sales in stores open at least a year were down 24 percent.

“If you’re in New York, and you’ve got the financial services industry in a depression, how can you possibly do well in high-level goods?” asked Howard L. Davidowitz, chairman of Davidowitz & Associates, a retail consulting and investment banking firm.

Madison Avenue has traditionally catered to the wealthy, but until Polo Ralph Lauren opened at the former Rhinelander Mansion on 72nd Street in 1986, most of the shops were private boutiques like E. Braun. In 1998, the stretch on Madison Avenue known as the Gold Coast surpassed Causeway Bay in Hong Kong as the most expensive shopping strip in the world, Cushman & Wakefield reported, with annual rents averaging $550 a square foot. By then, Giorgio Armani had two 16,000-square-foot stores on Madison and Hermès was about to move there from 57th Street.

For many international retailers, a Madison Avenue address was viewed as essential for promoting their brand, even if sales were not robust enough to justify the rent. Often, part of the rent came out of the marketing budget — a practice that brokers say is fast disappearing.

Rents began escalating rapidly a few years ago, after the stores on the Madison Avenue side of the General Motors Building, at Fifth Avenue on 58th and 59th Streets, were expanded and began commanding annual rent of more than $1,000 a square foot, said Benjamin Fox, the president of Winick Realty Group, a New York retail brokerage.

In 2007, fancy jewelers clustered on the avenue, especially between 61st and 64th Streets. They were able to afford higher rents because their costly merchandise could fit into smaller spaces and more revenue could be squeezed out of every inch. Rents skyrocketed to $1,250 a foot or even more. (Even so, Fifth Avenue between 49th and 59th Streets is now ranked as the world’s costliest shopping strip, with asking rents as high as $2,000 a foot. Its luxury tenants share the avenue, however, with shopping-mall clothing chains like Diesel and Abercrombie & Fitch.)

Retailers typically expect their rent to equal about one-tenth of their sales volume. “In a prime location like Madison Avenue, most retailers will change that to 25 percent,” said Joel Isaacs, the president of Isaacs & Company, a retail brokerage. Even under that formula, a tenant paying $1.25 million for 1,000 square feet would need to have nearly $5 million in annual sales.

Today, however, asking rents on Madison and elsewhere are dropping by as much as one-third, brokers say. And many landlords will offer more concessions than before, like additional months of free rent. “If you’re a good retailer and you’ve got a good product, the landlord wants you,” said Faith Hope Consolo, the chairwoman of the retail group at Prudential Douglas Elliman. “The word ‘no’ no longer exists.”

Taking advantage of the softening market, Lalique, which sells crystal goods, gave up its two-level store near 63rd Street — now occupied by the watchmaker Mauboussin — and is moving into smaller quarters five blocks to the south, with lower rent than it would have paid six months ago, Ms. Consolo said.

The astronomical rise in rents did not cause all the impending vacancies on Madison. Some tenants, like the jeweler Graff, have moved to larger quarters nearby. (Hublot, a Swiss watchmaker, recently came close to leasing Graff’s former store but got cold feet and withdrew, said Robert C. Fink, director of leasing for the landlord, the Winter Organization.)

William Friedland, the Gold Coast’s largest property owner, is emptying out a building that houses the restaurant La Goulue and several stores in order to redevelop it.

Frederic L. Barbatelli, a co-owner of E. Braun, said he was moving to be closer to D. Porthault and other Park Avenue purveyors of luxury home goods. But Ms. Consolo, who is offering a Mini Cooper to the broker who snags a lease for E. Braun’s Madison Avenue space, between 63rd and 64th Streets, said the store had been driven out by high rents.

Mr. Victor of Lansco said that lower rents would be good for Madison Avenue. “The market reached a crazy level,” he said. “A lot of people who wanted to look at Madison Avenue couldn’t make it pencil out. This may be a reality check. It will still be high-end, but it will be a healthier Madison Avenue.”

With incentives, rents are down 10 to 15%

IN this painful economic climate of layoffs and shrinking investments, there is a sliver of positive news: it’s a good time to be a renter in New York City. Prices are falling, primarily in Manhattan, and concessions like a month of free rent are widespread.

Amy Baglan and Johnny Muñoz negotiated the rent.

Although it is notoriously difficult to quantify the state of the rental market, rents fell in almost every sector of the Manhattan market last year, according to the Real Estate Group, a New York brokerage. The steepest drop was in one-bedrooms, down 5.7 percent in buildings with doormen and 6.53 percent in buildings without. The only category that rose: rents for two-bedroom apartments in doorman buildings, up just a bit, by 0.61 percent. But these numbers, like most available data, represent asking rents rather than the final price. Anecdotal evidence suggests that some people are negotiating rents as much as 20 percent lower than the original prices asked by landlords. These figures also leave out incentives, like a month of free rent or a landlord’s paying the broker fee, which can add up to real savings.

Fritz Frigan, executive director of sales and leasing at Halstead Property estimates that when these incentives are considered, rents are actually down some 10 percent to 15 percent since the market peak in mid-2007.

“In that really strong market,” Mr. Frigan said, “landlords didn’t have to do anything.” In 2008, that was no longer the case.

In January 2008, Halstead had about 90 listings for which the owner offered to pay the broker’s fee. By the summer, that number had pushed upward, hitting about 450 a month.

“Then, in September or October, the whole thing broke loose,” Mr. Frigan said.

In a one-month period, from Dec. 23, 2008, to Jan. 23, 2009, some 1,700 of Halstead’s 9,000 total rental listings included owner payment of the broker’s fee.

Jimmi Circosta, a vice president and associate broker at Citi Habitats, also saw a big slowdown in the autumn, which he pegs to the collapse of Lehman Brothers in September. “Once that news hit the marketplace,” he said, “it just got really quiet.”

Tom Botts and his wife, Libbie Rice, found all kinds of deals from landlords when they went apartment hunting this winter, and they were able to negotiate a reduction in the rent on the Upper West Side three-bedroom that they finally chose. They also encountered a symptom of the market that was simply unheard of in recent years: their previous landlord offered to lower their rent if they renewed their lease.

“We had a truly un-New York experience with our old landlord begging us to stay,” Mr. Botts, 39, said in an e-mail message. The owner offered a rent reduction of more than 10 percent, but the couple had already found an apartment they preferred and were committed to moving.

It’s impossible to say how often owners are lowering rents to encourage tenants to stay put, but anecdotes are starting to surface. “It’s not a common occurrence,” said Mr. Circosta of Citi Habitats, “but it is happening.”

Mr. Botts, a partner at Hudson Crossing, a travel industry advisory company, and Ms. Rice, 44, who does similar work as an independent consultant, hope one day to buy an apartment for themselves and their children, Tommy, 4, and Camille, 2. But they have decided to hold off for now. “The economy feels too scary,” Ms. Rice said.

They have a lot of company on the sidelines of the sale market.

“It certainly makes renting more attractive when the rental market softens,” said Gary H. Schatsky, a financial adviser in New York. “If people suspect — as most people do — that the New York City sales market will get much softer, and they’re able to rent in the meantime, then being able to negotiate a rental rate puts you in a better position.”

Teresa Hsiao found a kinder-than-expected rental market when she moved to Manhattan from Los Angeles last month.

“I was expecting to live in a box,” she said. She looked at more than 10 apartments and found lots of concessions on nice spaces that added up to substantial price cuts. “Everyone was paying the broker fee,” she said. “They were very flexible on their lease terms. One broker told me: ‘We’ll get it done for you. Just name your price and we’ll do it.’ ”

Ms. Hsiao, 23, and her roommate, David Liu, 24, settled on a two-bedroom two-bathroom apartment in Midtown on the West Side. It was listed for $4,200. They offered $3,650 a month and were accepted. After one month free and a $2,000 signing bonus, the total came to $3,215 monthly, and they did not have to pay the broker’s fee.

“This apartment was definitely a great find and a bargain compared to 1.5 years ago,” Mr. Liu wrote in an e-mail message. “It’s definitely a renters’ market now.”

The creation of jobs is one of the primary ingredients in a strong rental market, and people like Ms. Hsiao and Mr. Liu, who both moved to New York for work, used to be its lifeblood. Now their numbers are dwindling as the city has begun to shed jobs.

Libbie Rice and her husband also negotiated their rent.

According to the New York State Department of Labor, New York City lost 49,100 private-sector jobs from December 2007 to December 2008, which helped send the unemployment rate from 5.1 percent to 7.4 percent.

“People assume when sale slows down, rental will pick up, but that depends on what the source of this is,” said Gregory J. Heym, the chief economist at Terra Holdings, which owns Halstead and Brown Harris Stevens. “When you’re losing jobs, the rental market is also going to suffer.”

While prices have started to slide in Manhattan, they are steadier in Brooklyn. Increasingly, however, there are deals to be found, especially in neighborhoods like Williamsburg that have seen a lot of new construction.

Last July, James McGuinness, 23, and his partner, Louis Kerscher, 25, moved into an apartment in Windsor Terrace, Brooklyn, for which the owner paid the broker’s fee. Adrian Cardona, a broker with the company they used, Rapid Realty, says he has seen more owner payments since the summer. “Absolutely,” he said. “They have no choice.”

Patrick McGrath, a managing partner at Taurus, which owns a recently converted luxury prewar rental building in Brooklyn Heights called the Standish, says the Brooklyn market has softened, but not a lot.

“We’re not renting as fast as we would have expected,” Mr. McGrath said. “We’ve had to provide concessions — a free month rent, we pay the broker fee. But rents are around where we expected them to be. We’re in the ballpark.”

Owners with more property — and deep pockets — generally would rather offer incentives than reduce rents because when the market comes back, they start from a stronger bargaining position. But landlords of smaller buildings tend to just lower the rent.

Allison Gill and Hadley Hege, both 22, found that they had some bargaining power when they went apartment hunting late last year. Ms. Gill, a law student, and Ms. Hege, an actress, looked at a two-bedroom apartment in a three-unit building in Cobble Hill, Brooklyn, listed for $2,000. They took it for $1,900.

The rental market in Queens, meanwhile, is relatively stable.

“The prices are not going up,” said Donna Reardon, Queens divisional manager for Prudential Douglas Elliman. “They’re staying the same.” Concessions are still an exception rather than the rule in that borough.

It is in Manhattan, which saw steep price gains in recent years, where the discounts can be substantial now — even on the higher end.

Sara Nuttall, her husband and their 11-year-old twins relocated to New York at the end of last year from Dakar, Senegal, where they paid $2,500 for a five-bedroom house with a garden. They were looking for a three-bedroom apartment and started with a budget of about $6,000 a month.

Senad Ahmetovic, an associate broker and vice president at Halstead, showed them about 35 apartments.

“In my 10 years’ experience, I haven’t seen so many three-bedroom apartments on the market,” Mr. Ahmetovic said. “It just seemed endless. In the past, they weren’t being offered with incentives, because there were so few available at any given point.”

That, it seems, is no longer the case.

“We started to discover that there were incentives there for us,” said Ms. Nuttall, 52. “That made a big difference. It meant we could get something that was a bit nicer, a bit more what we wanted for the same price.”

They eventually settled on a three- bedroom three-and-a-half bath apartment in east Midtown. It was listed for $8,500 but they were able to negotiate the rent to $8,000 a month. They also received a free month of rent, and the owner paid the broker’s fee. Their monthly payment will be $7,400. That $1,100 decline represents a 13 percent decrease from the asking rent, not including the money saved on the broker.

Ms. Nuttall found the apartment in December, always a slow time in the rental market. But seasonal sluggishness does not explain the discounts that she encountered.

“In any last quarter, the rental market always adjusts — vacancies rise and prices dip, every year,” said Gary Malin, the president of Citi Habitats. “This year there was substantially less activity than you would normally see. There was an extra layer of pressure on the rental market — and the world at large — that forced prices down further and vacancy rates higher.”

Some landlords hope that adjusting leases to expire in summer 2010 will get a better price next time around.

Amy Baglan, 26, and her boyfriend, Johnny Muñoz, 28, found a one-bedroom apartment in a prewar building on the Upper West Side at the end of last year. They negotiated a cut of $200 per month in the rent and received a free month. (They connected with the owner on Craigslist and did not use a broker.) But they signed a 16-month lease, which will expire at the end of April 2010.

Mr. Muñoz wondered why his landlady was not offering a standard one- or two-year lease. “Do you want to make sure this is open and available during the prime season of rentals?” he said he asked. She chuckled and said yes, Mr. Muñoz said.

Mr. Muñoz’s landlady may get a boost from the warm weather, but no one knows where the market will be in 2010.

“My assumption would be over the next year that you’re going to see effective rents drop because of the increase in concessions,” said Andy Joynt, a real estate economist at Property and Portfolio Research, an independent research and advisory firm. “We’re forecasting that asking rents are also going to drop,” he added. “We’ll see if that ends up being reflected in the numbers.”

Marc Lewis, the president of Century 21 New York, has seen several recessions in his many years in the business, most recently after Sept. 11, 2001. “But in the past,” he said, “it always felt like it would be a few months and then it would be over. This one, we don’t have an answer yet.”

Many people — including President Barack Obama — are suggesting that the economy is likely to get worse before it gets better. And the rental market is unlikely to strengthen until the economy, and the job market in particular, turns around.

According to the Independent Budget Office of New York City, the outlook is bleak. The agency expects the city to lose 243,000 jobs from the peak of early 2008.

“Let’s hope this is a short-term problem,” said Vicki Been, the director of the Furman Center for Real Estate and Urban Policy of New York University. “You know, we prefer more affordable housing, until there’s a downturn. And then we panic.”

Biggest price cut of the day

Robert Browne (top) and John Burger (bottom) are listing a unit at 151 East 58th Street.

The unit with the biggest recent price cut in Manhattan is a three-bedroom, three-bath apartment at 151 East 58th Street, according to Streeteasy.com. The price of the One Beacon Court unit was cut by 10 percent on Friday. The 3,058-square-foot unit is down to $14.4 million, $1.6 million less than its original $16 million listing in November. Both Brown Harris Stevens' John Burger and the Corcoran Group's Robert Browne are listing the apartment in the mixed-use building, designed by Cesar Pelli & Associates in 2005. The building, between Lexington and Third avenues, has 105 residential units, with eight listed for sale and six available for rent, according to Streeteasy.com.

Meanwhile, the most expensive unit to come on the market is a $13.5 million unit at 25 Central Park West at 62nd Street. The 2,767-square-foot unit has three bedrooms, four bathrooms and an 875-square-foot terrace. Stribling & Associate's Cathy Taub, and Corcoran's Robert Browne and Chris Kahn have the listing.