Surging Island Condo Market Outpaces the Rest of Manhattan

June 11, 2017

Corcoran real estate broker, Ben Garama, is trying to set a Roosevelt Island record with the Island’s first ever $2 million listing. The three-bedroom condo at 415 Main Street, which has been on the market for three weeks, has already attracted multiple offers, leaving its owners with a tough, but welcome decision – take the highest offer, or wait for the asking price. Either, according to Garama, will set an Island record.

 

It’s a milestone that comes at the same time that real estate sales in nearby parts of Manhattan have remained relatively steady. 

 

“This year is a really crazy year for Roosevelt Island. I’ve seen condo prices increase ten percent,” says Oren Liberman, a real estate broker with Halstead, who has represented many buyers, sellers, and renters on the Island over the past seven years. According to Liberman, $2 million might break the sales record, but it wouldn’t break the Island’s square-footage record. An apartment in 455 Main Street broke that record at $1,417 per square foot. For comparison, he points to a listing he has just on the other side of the Queensboro Bridge at 401 East 60th Street (known as Bridge Tower Place). The two-bedroom, two-bath condo is listed for $1.7 million, amounting to $1,376 per square foot. 

 

“In the last two years some of the Island’s apartment prices went up by 15-20 percent but Manhattan prices stayed stagnant,” says Liberman. “The Island used to be the cheaper option for Manhattan, now it’s the better option than Manhattan.”

 

Taking a Chance

 

415 Main Street, named Riverwalk Court, is the Island’s only purely condominium building. (Neighboring 455 Main Street is primarily condominium except for the first few floors, which are owned by Weill Cornell and rented at a subsidized rate to postdoctoral associates and their family members.)

 

The current owners of apartment 7G, Gianluca Macciocca and Brian Hooper, are leaving the City for larger digs in Poughkeepsie, NY, where they are trading Riverwalk Court’s amenities and luxury styling for a 5,000 square-foot historic home. “We love the Island, we will miss it a lot,” says Macciocca. Hooper adds, “I was a little angry at Sportspark for closing the pool for half a year.” He participates in the Masters Swim program there. 

Owners Brian Hooper and Gianluca Macciocca

 

 

In their eight years here, the two men say they’ve seen the Island really grow.  

 

The couple purchased their three-bedroom, three-bathroom home for $1.2 million after seeing renderings of the building back in 2008. “At the time, it seemed like a lot,” says Hooper. While it was under construction they spent a year renting at the Octagon. 

 

“This is a premier apartment,” says Garama, pointing out the special position that G-line apartments like his clients’ hold in the building. “It is the only three-bedroom line in the building, and the only [three-bedroom] line in either 415 or 455 that is Manhattan-facing.” And, according to Garama, only 415’s G-line offers a three-bedroom apartment with three full bathrooms in either of the two condo buildings.

 

 

Another G-line apartment sold for $1.75 million in early May of this year. “The Island is going crazy,” he says. “This is the story.”

 

A Vision Dimming

 

In 1969, when architects Philip Johnson and John Burgee designed Roosevelt Island’s master plan, the Island was conceived as a utopia for the working and middle-class. Most of the apartments were subsidized through State and federal programs such as the Mitchell-Lama program, which offered State-sponsored housing for moderate- and middle-income households.

 

When Southtown was developed, panic about losing the Island’s economic mix followed. “We are in the midst of vast change, and real estate is the prime consideration,” Matthew Katz, a former president of the Roosevelt Island Residents Association, told The New York Times 12 years ago. “The Island is being set up for gentrification, which means that middle-class housing will disappear.”

 

Between 2000 and 2010, a building boom on the Island increased the number of housing units by over 50 percent. For the most part, that housing was market rate. According to the Island’s General Development Plan, only 25 percent of Northtown and 40-60 percent of Southtown was supposed to be market rate. The remainder of the housing was intended for middle and lower income residents. In the meantime, three of the Island’s four Mitchell-Lama buildings have left the program, and the fourth, Westview, is on its way.

 

The Draw

 

According to Liberman, one thing that has driven up sales prices on the Island is the fact that buyers currently don’t have to pay property taxes. “It’s important to mention that Roosevelt Island condos have a tax abatement until 2025, while [a building on the other side of the bridge] has no tax abatement. Tax abatement makes a building more appealing, which is a big draw for the Roosevelt Island condos, even as prices have begun to surpass condos found in Manhattan.”

 

Liberman also sees the Island’s newest neighbor as a draw. “No doubt, the biggest draw right now to Roosevelt Island is the Cornell Tech campus, which really put Roosevelt Island on the map. It has helped drive sale prices up. Across the bridge in Manhattan, prices have held steady for the past two years.”

 

“I am a big believer in the Island,” says Garama. “I’ve sold here for seven years and people double their money. The first two things I always say to people who don’t know the Island is: where do you see another place that has three forms of transportation, and, where do you see another place like the Island anywhere else?”

 

Garama calls the Island “a niche market,” and contrasts it with the Hudson Yards neighborhood in Manhattan. Bounded by 30th Street, Twelfth Avenue, 34th Street, and Tenth Avenue, Hudson Yards was planned, funded, and constructed under a set of agreements among the City, the State, and the Metropolitan Transportation Authority. Garama says the project shows that you can’t just build tall buildings and try and make a neighborhood. On the Island, however, “there is something already here, a real history, a soul.”

 

Hooper and Macciocca agree. “Based on what we saw in Manhattan and this, there was no competition.”

 

And it’s not only newcomers to the City who feel that way. Liberman says he has helped three or four buyers who grew up on the Island. “They left Rivercross [a cooperative at 531 Main Street] and all they want to do is get back.”

 

Perhaps the biggest winner when it comes to the Island’s residential real estate is Memorial Sloan Kettering Cancer Center, which is the single largest owner of apartments on the Island. They own four floors comprising 52 apartments in 480 Main Street, and a quarter of apartments at both 455 and 425 Main Street. They also own the 258-unit apartment building at 475 Main Street, in which they house staff. 

 

“They are a real estate monster,” says Liberman

 

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