Chinese see NYC real estate as a sound place
Updated: 2014-07-11 12:06
By Elizabeth Wu in New York (China Daily USA)
When you walk into the glass building, the walls are a cool stone texture filled with matching furniture that generates a similar vibe. You feel as though you are walking into a modernist cube.
This is One57, the 90-story luxury apartment building between Sixth and Seventh avenues in Manhattan where owners Yu-Ting and Yu-Wen Huang, long time residents of the nearby Mandarin Oriental at Time Warner Center, have chosen to make their new home.
Many other Chinese also have decided to buy in New York City, so many that real estate industry observers say they are the leading buyers in the Big Apple. And one of the main reasons for doing so is that they see it as a more stable market to invest in compared to Shanghai or London.
Foreign real estate purchases in the United States rose to 35 percent last year, with Chinese customers leading the way, spending $22 billion of the total $92 billion spent by foreign buyers, according to a report published on Tuesday by the National Association of Realtors.
The Huang's, former owners of a 69th-floor two-bedroom apartment in the Residences at the Mandarin Oriental at Time Warner Center, jumped ship for a 50th-floor apartment in One57, for which they paid $19.1 million, according to real estate website Curbed.
In 2010, the Huang's paid $6.1 million for their Mandarin apartment, and relisted it later that year for $7.65 million. It has since been delisted and has not been put back on the market.
One57, formerly known as Carnegie 57, is a high-end, contemporary residential tower designed by Pritzker Prize-winning French architect Christian de Portzamparc. It is the city's tallest residential building. The interiors are by New York-based designer Thomas Juul-Hansen.
"At One57, Chinese buyers are able to put their money into real New York City assets, and in a market of much greater stability than they are offered at home," said Santo Rosabianca of WIRE International Realty, an international network of real estate agencies specializing in exclusive properties. According to Rosabianca, 10 to 15 percent of his firm's clientele come from China.
"One of the traits that sets Chinese investors apart is that they are generally looking for much longer term appreciation, as opposed to other foreign nationals, who may be looking to simply rent out a purchased property to generate a steady flow of income," he said. "Buying at One57 affords these buyers an apartment that they can hold onto, and eventually rent out and earn an incredibly strong rate of return."
Chinese foreign nationals also can make one large real estate purchase at One57, between $10 million and $40 million, instead of diversifying their portfolio with multiple units, said Rosabianca.
"International buyers are smart by parking their money in a NYC apartment as an investment, since the city real estate market is seen as stable, in comparison to other international markets." said Andres Perea-Garzon, a real estate agent with TOWN Residential in the city.
"There are different types of buyers, one will purchase an NYC apartment as a safe haven for their money, another will flip the unit for a profit or will place the apartment on the rental market. Other buyers will use the apartment as a pied--terre," said Perea-Garzon. "Ultimately, they are all investments in the long run."
More buyers are purchasing luxury apartments under the names of corporate entities to conceal their identities.
"If you look at all recorded sales within the past two years, you will see that the majority of New York City's luxury real estate has been purchased under an LLC (Limited Liability Corporation)." said Rosabianca. "This allows buyers to protect their identity and to keep themselves anonymous in transactions."
As for which area of the city Chinese buyers prefer, he said:"The neighborhood the buyer chooses all depends on the price tag they are comfortable with and willing to pay to 'buy a piece of Manhattan.'"
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For China Daily
The One57 condominium tower rises above Midtown Manhattan. Elizabeth Wu / for China Daily
(China Daily USA 07/11/2014 page2)