You knew AIG was going to be shedding assets as quickly as humanly (or inhumanly) possible. You also knew that some of this stuff was going to go at firesale prices. Be this as it may, the panic sale of AIGs buildings is something of a surprise:
Six months ago, sources had estimated that 70 Pine St. could command between $310 million and $385 million, in part because the Art Deco Tower with its lovely architectural details and relatively small floor plates would have made an ideal condo conversion. At this point, however, it is highly unlikely anyone would want to convert the tower in a deepening recession that has already sent apartment prices reeling and left a vast number of units vacant.
Ouch.
AIG HQ to sell at fraction of price [Crains New York]
I bid $150 mil., contingent upon a Treasury guarantee.
Thats not 70 Pine. Does it look like “an Art Deco Tower with lovely architectural details”?
‘Tis true. I’m moving at the end of this month, and rental prices are down ~10% – ~15%. Downtown (financial district, at least) is going to be an absolute wasteland /ghosttown in 1 year.
Oh, it’ll go condo eventually: it’ll be a Jo-burg Conversion Special.
See: http://www.whiskeyandgunpowder.com/side-trip-to-soweto-sprawl/
Well, or (due to 9/11 tax incentives and low rent) corps pick up and leave midtown for windy, cold downtown. Should be interesting. Either/or will take it on the chin, I’d guess.
Are we talking about 70 Pine or 175 Water? Someone didn’t do their homework. Either way, as long as Flavors stays put I’m happy
@2, Really? That’s not art deco? I’ll make sure to let Frank Gehry know that your considerable architectural skills are available.
@ 7 — that’s a pic of the Water St. HQ, which is decidedly NOT art deco.
Chrysler Building, Empire State, Chanin Bldg — THOSE are art deco.
@7 – you’re an idiot
@8 – exactly. Also, 30 Rock and 70 PINE
Too Art, couldn’t Deco…
They’ll sell both of the buildings and won’t even cover their guaranteed bonuses… sweet!
8,9 and don’t forget one of the best of all, the old American Radiator Company (now American Standard) Building, south side of Bryant Park, now a hotel, which was the precursor to 30 Rock. Same architect, Raymond Hood.
Why would you do a sale-leaseback on a vacant property? The article is goofy – they claim AIG’s HQ is vacant. I think they got all the properties mixed up.
They’re going to sell the buildings at fire-sale prices to some distressed firm, write CDS’ against the formerly assessed full value and end up losing an assload of money on the deal.
Who wants to bet?
-2StopShop
@9, Apparently your skills at detecting sarcasm are poorly developed. Best you go back to your spreadsheet for the next great RE deal you’re undewriting.
I live in 15 CPW. So what?
Suck on my prestige.
If the gubmint buys it they’ll get 300 million – we always pay 100 cent on the dollar.
Condo conversions in lieu of cash bonuses. Problem solved.
i was head of AIG financial. i’ll write the default insurance. send the check here…
http://maps.google.com/maps?li=rwp&q=32+Minute+Man+Hl,+Westport,+CT+06880
16 Don’t you think 15CPW is overhyped? A condo is at the end of the day just a condo. Anyone can get in. Also, how can a truly great building have on its ground floor branches of Best Buy and West Elm. The later being Pottery Barn’s answer to IKEA. If money were no object, there are a dozen other buildings that are preferable. Problem is you need to first get by their pesky co-op boards.
@ 3 – Yep, seems like Downtown is going back to the post-9/11 days. They’ve already foreclosed on the two 30+ story apartment buildings they started building across from the new GS building in June. Took the crane away over the weekend, leaving maybe two stories above ground partially completed.
21,
In terms of residential, I read in the times (maybe 2 weeks ago) that Battery Park/Financial District was the new Park Slope. Bodegas galore, food shops open late, plenty of space, and on and on. Perfect for babies! I’m sorry. I work down there, and the place is lights-out after 7 pm. If anything, I think you’ll see a lot of post-university students moving into the area, as it’ll be dirt cheap and somewhat accessible (trains, buses; pretty similar to midtown (see: Hell’s Kitchen, late 90′s)). Per usual, read it in the newspaper and the trend has been dead for 6 months.
In terms of commercial, it’s really up in the air. Like I mentioned, there’s plenty of reasons to move down there due to crazy tax incentives (9/11) and cheap, cheap rent.
I used to be kind of upset about the length of time it’s taken for the Freedom Tower (or whatever bullshit name they’ll settle on) to be erected. But now…jesus, what the hell is the use? I mean, I’ve seen the project most productive just in the last 2 years (sans moving the PATH from Church to W. Broadway — I didn’t get it, and I still don’t). And the new Goldman building boggles my mind. What will 85 Broad/NYP become? Another Hanover? Good luck with that, given the outlook for the next few years.
Midtown eats shit or downtown dies. One of the two. It’s not a good time for New York.
Here’s to hoping a lot of the guys “released” this past year start funds or other shops, and rent some of this space. Personally, I’d like to see more VC people in NY, poaching the media types for ideas and connections. Talk about killing two (unemployed) birds with one stone.