Speculations On Whether A $110 New York Penthouse Is Truly A Fitting Bargain For The Wealthy

5 January 2012

Within New York City’s highly coveted 15 Central Park West condo complex is a penthouse sale which is currently underway for the value for $88 million. The 6,744-square foot apartment had been placed on the market by Sandy Weill, former Citigroup chairman, to the 22-year old daughter of the billionaire from Russia, Dmitry Rybolovlev.

The $88 million asking price essentially breaks down to over $13,000 per square foot which happens to be the highest price to ever be paid within New York City and even within the United States.

With much credit to the massive property sale, the new luxury building called One57 which is found just blocks away has decided to bring up the asking price on the condo which has yet to set rise within the area.

The penthouse property at the One57 is expected to have an area of 10,923-square feet which is going to be comprised of both the 89th as well as the 90th floors of the luxury building and is looking to be placed on the market for an asking price of $110 million despite the fact that it was originally listed for a value of $98.5 million.

Given the new asking price which is 12 percent higher than its original value, the sale which has yet to happen is looking to be the most extravagant residential listing in New York City of all time. Despite that, the developer claims that it is still considered to be a bargain deal as the properties at the One57 are still found at 20 to 30 percent discounts compared to what the price values are for other luxury buildings within the city.

Due to the rate of sales and demand, prices have gone up on the local market and are looking to go up even further in the future. According to the company behind the construction of the One57, the new prices are still conservative considering where the local market stands today.

On the other end, there are real estate experts within New York City who claim that ultra luxury property transactions tend to take place in clusters and that trending in the luxury market is very difficult as it tends to go on and off from time to time, and having said that, it seems that these types of transactions are currently green and on the go.

Prior to Ekaterina Rybolovleva entering into the $88 million contract on the penthouse property, there had already been some major real estate activity in 2011 wherein the wealthy Russian composer Igor Krutoy had purchased a 6,000-square foot spread at The Plaza for $48 million in March. A few months later, a 4,400-square foot Time Warner Center penthouse had raised its price to $60 million from $44.95 million.

Now, the question at hand becomes a matter of finding out why these areas are able to place such high values on real estate. Essentially, the main reason is because of the fact that billionaires and celebrities prefer these locations out of all their options since these areas close to everything — including access to breath-taking views — while still being able to maintain a sense of privacy and exclusivity. Also, the very reason these types of luxury options are being made available on the market is because of the fact that there is a demand for these properties because these are exactly what wealthy property buyers are looking for on the market.