Manhattan New Launch Condo Investment For Foreigner
Posted by Wei Min Tan on January 19, 2022
Investing in Manhattan new launch project for foreigner, brief case study
This is an update on our foreign investor client’s condo at 200 E 21 St in Gramercy. We had booked the property at pre-construction stage, waited 2 years for completion and then rented the unit immediately after closing. We’ve had 2 tenants since closing. Last year, given the pandemic, rents decreased about 25 percent, consistent with rest of the market.
In Manhattan, rents have since picked up to pre-pandemic levels as people are all moving back into Manhattan. This is because companies are calling employees back to the office (no more working from home full-time). The condo currently gets $5,100 per month in rent, increased from $4,500 which was the pandemic rate.
Building: 200 E 21 St, York, NY 10010 (Condominium)
Price: $1,380,000
Common charges: $688
Property taxes: $1,292
Rental return: At rent of $5,100, rental return of 2.7 percent based on purchase price. High by Manhattan standards.
Property type: Freehold
Size: 713 square feet, one bedroom
Contact: tan@castle-avenue.com
Investing decision
The investing decision was based on analyzing the market demand for high end condo rentals in Gramercy. Demand was strong and there was not much high end supply in the area.
200 E 21 St in Gramercy. Located on tree-lined street on 21St and Third Avenue, this is a green building targeting LEED Gold certification. Designed by BKSK Architects and developed by Alfa Development.
Downside of buying new launch condo
With new launch property projects, usually the amenities (fitness center, resident’s lounge etc.) will not be 100% complete until months after closing of the condo unit. The first owners in the building will have to endure construction in the common areas. For investors, sometimes tenants will want a discount to compensate for not being able to use the amenities.
Poliform kitchen designed by Champalimaud with top of the line Miele appliances.
A high end marble bathroom is another key mark of a luxury condo and this translates into higher rent per square foot. Bathroom comes with Dornbracht fixtures and bathtub by Kohler.
What We Do
We focus on global investors buying Manhattan condos for portfolio diversification and long term return-on-investment.
1) Identify the right buy based on objectives
2) Manage the buy process
3) Rent out the property
4) Manage tenants
5) Market the property at the eventual sale
Article updated Jan 19, 2022
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