A 91-unit West Village condo project that was stalled for three years by the downturn has landed a large construction loan, a potential sign that Manhattan condo construction is coming back to life.
The Witkoff Group has received a $230 million loan from Wells Fargo and M&T Bank, and plans to put $140 million into the project. The developer is already moving forward with construction, and expects the project to be finished in 18 months.
After purchasing the site in 2004, Witkoff Group Chief Executive Steven Witkoff guided it through a rezoning. Then the real-estate market slumped. “We sat back and got thoughtful about what we wanted to do with it,” Mr. Witkoff said, adding that the wait has paid off.
“In some respects it feels like the [condo] market’s more robust” than 2007, Mr. Witkoff said. “There’s just a lot of trades, a lot of buys for premium property” today, he said.
He declined to discuss specific prices, but said 150 Charles will be priced in line with other luxury properties in the area. Average condo prices in the Village have risen to $1,683 a square foot in the third quarter from $1,405 a square foot in the third quarter of 2008, according to Miller Samuel Inc. Jonathan Miller, CEO of the appraisal firm, said there have been virtually no construction loans from commercial banks for new condo construction since the downturn. A lack of new condos might prompt banks to step up lending, he said.
“What’s compelling in this market is the chronic shortage of new development,” Mr. Miller said. “Maybe this one of the first shots fired across the bow.”
Only a handful of large condo developments are now under construction in the city, including Extell Development Co.’s One57, 432 Park Ave. on the former Drake Hotel site, and the Rudin family’s condo on the former St. Vincent’s Hospital site.
The Witkoff Group along with Morgan Stanley also purchased a 16-story building at 1107 Broadway, which it plans to convert to about 145 luxury condos.