Home News Gary Barnett of Extell on Holdouts, Rent Hikes and 421a

Gary Barnett of Extell on Holdouts, Rent Hikes and 421a

by admin
0 comment

Gary Burnette doesn’t do much interviews. But it turns out that he has a lot of opinions.

Billionaire founder and president of Extell Development shared some of the following in a rare sit-in on Thursday:

  • He said he shouldn’t have to pay millions of dollars to offer a tenant.
  • It is wrong to say that foreign buyers in luxury condominiums are “saving cash.”
  • Rents haven’t skyrocketed, but have returned to pre-pandemic levels.
  • And developers often lose money and therefore deserve every penny when they make a profit.

Talk to Real Deal publisher Amir Collangy in front of an audience of hundreds TRDThe guy behind Manhattan’s showcases and forums, and iconic condo towers such as Central Park Tower and One57 didn’t hide what was a hit when the market was sluggish.

During October TRD He reported that he was selling a condo at Central Park Tower 25% discountMay reduce project sold out by $ 1 billion.

“I did what I had to do when the market was down,” Burnett said. “When Covid hit everything, we dropped prices altogether, but since the beginning of 2021, the market has seen a tremendous rise.”

He disputed the story of a runaway rent.

“It’s completely inaccurate to say that rent has increased by 30%,” Burnett said. “The only thing it did was get it back to normal.”

Many buildings, including some of himself, did not generate enough income to pay their debts when rents and apartment prices fell. Therefore, Mr. Burnett said he should not resent builders who raise prices when the market recovers.

The pitfalls faced by developers are not limited to unpredictable market cycles. Barnett also touched on the challenge of navigating tenant holdouts. Embarrassed rival Mikina Naphtali He is trying to turn an Upper West Side rental property into a condominium.

“We are very reluctant to go into what could be stopped by holdouts,” says Burnett, who usually spends years building a development site to build a market-defining project. Told. He was an important figure in the creation of the billionaire column.

Mr. Burnett protects the rights of developers under the law because lawyers are working hard to vie for huge settlements for aggressive customers, and the government’s bureaucracy and court system are moving too slowly. He said he couldn’t. In the case of Naphtali, the tenant has an expired lease and is not entitled to renewal, but remains in the Penthouse unit for months seeking a 7-digit payment.

Lawyers may plunge for the tenant and himself by delaying home construction and increasing its costs.

“He may benefit a lot for his clients, but is that good for society?” Burnett said.

The Extell chief also challenged the assumption that wealthy people are buying luxury condos like him not as a place to stay, but to “save their money.”

“It’s a ridiculous expression,” Burnett said. “Why deposit money in real estate when you can’t move easily?” (It often takes years to sell an apartment for tens of millions of dollars.)

He has relatively few people who can afford to live in Central Park Tower, but he has made significant contributions to the city in other ways, such as generating nearly $ 20 million in taxes annually and hiring building staff. Claimed to be.

The developers commented on some policy issues, especially the property tax deduction for rental projects, including affordable housing, 421a.

“The 421a has achieved a tremendous amount. Before the June 15th deadline, Barnett said,” We need more programs. We hope the government will work together. “

On the topic of turning outdated office buildings into homes, he said it would simply be too expensive without proper tax incentives. Offices tend to have large floorboards. The housing code requires windows in every bedroom.

The developers mentioned Times Square, where the casino could be allowed in the city — where Extell was recently completed. 446 key hard rock hotel — Already busy enough and not a good place for a gambling venue.

He didn’t say where the casino should go, but he did say who the developers should be.

“When it comes, I want to make it,” Burnett said.

You may also like