Lessons from the $17 million buyout of a rent-stabilized apartment
By Lucy Cohen Blatter |March 3, 2014 - 11:30AM
Two of the most common NYC real estate fantasies are finding a rent-stablized apartment and getting a hefty buyout for said apartment. Reclusive New Yorker Herb Sukenik managed both. The story--considered to be the largest buyout in NYC history -- is chronicled in real estate journalist Michael Gross' House of Outrageous Fortune, a new book that goes behind the scenes of 15 Central Park West, the city's premier condo for the rich and richer.
Sukenik waited until all other rent-stabilized tenants at the then-Mayflower Hotel had left, knowing that by being the "last man standing," he had tremendous power over the developers of 15 Central Park West, who were looking to turn the shabby rental building into a luxury condo.
This 35th-floor apartment at 15 Central Park West is asking $65 million (Photo credit: StreetEasy)
Take note: If you are one of the last holdouts in a building, and the landlord is paying interest on a large loan, he/she not only has to maintain essential services in the building with little income, but also has to make payments on the loan. Translation: Higher bargaining power on your end.
1. Use your age to your advantage. If you're young, and therefore could occupy the apartment for a long time, you can potentially demand more from the developer.
2. Know your worth. If your apartment is in an amazing location (e.g., across from Central Park as 15 Central Park West is), understand that it's worth a lot to the developer. Also, if your rent is way below market rate, the landlord's profits from fixing up your apartment and re-renting or sellling your apartment are that much greater. The more the landlord stands to profit, the bigger incentive he/she has to pay you the big bucks.
3. Know their worth. Some landlords may have a lot of money, some may not. Don't hold out forever for a large sum you may never get.
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