Gotham Brokers' Roundtable
New York Brokers Discuss Women & Real Estate Trends
Are women buying more real estate? Advancing in the brokerage field? Top brokers discuss these and other hot button trends in our latest real estate roundtable.
For Gotham’s Women of Influence issue, we asked real estate pros whether female advancement has been translating into real estate investment and how their own field, long dominated by women, has changed in the last few decades. We rounded out the discussion, held at Rue 57, with such on-everyone’s-mind topics as the strengthening dollar and how it’s impacting foreign buyers purchasing in New York, as well as the market segments seeing the most traction in 2015.
How many of your clients are women buying properties in their own names?
MARA FLASH BLUM: I’m seeing about 30 percent of younger women coming in and saying they want to get on with their lives—they’re going to buy an apartment and that’s it. I’m also seeing women who have worked throughout the years choosing to purchase an apartment with the proceeds of their hard work. And they’re a committee of one!
MICHELE KLEIER: A lot of women are buying on their own. And they are very decisive. I had this exclusive on Park Avenue, [and my client, who is] single, very successful in the art world, was the only one who gave us the right bid. I said, ‘Are you sure?’ She said, ‘I don’t have to ask anybody. I earn my money and I spend it the way I want.’ Many times with couples, they’re putting apartments in the wife’s name for tax reasons. Whenever I see a deal and the apartment is only in the husband’s name, I’m always like, Hmmm, why is that happening?
RICHARD STEINBERG: But to play devil’s advocate, I don’t think the boards of co-ops have stepped up to the plate yet.
CATHY FRANKLIN: Times have definitely changed, and I have sold many, many single women some of the most important apartments. I find that with women, their financials tend to be very strong, very detailed; they are very conservative in their investments. I have seen a lot of very savvy female purchasers [with] really good knowledge for making an investment.
Is it still difficult for a single woman to get into the toughest co-ops?
MFB: I’m not finding the same prejudice.
RS: What about sellers, though? I’m in the process of doing a deal now with a single woman. She’s in sales, so she doesn’t have a fixed income, and my seller has concerns. She makes several million dollars a year. Noble Black: Do you think that was inspired by her being female?
RS: Yes. It definitely was. He said it. MK: I guess it depends on the building, but I think a lot of people would be afraid to turn down a single woman when she is fully qualified. It’s begging for a lawsuit.
Women have long fared well as real estate brokers in Manhattan and they now head some of the major brokerage firms. Do you see women continuing to progress even more in the sector? MK: I’ve been in the business 32 years, and when I first started, it was almost [entirely] a woman’s field. I think men have actually come alive in the field.
RS: Think of the Alice Mason [Mason was a legendary broker with a high-profile clientele, including Marilyn Monroe]. They broke ground for the business. The big change I’ve seen is that it has become a more professional business, for both men and women. It used to be—with no disrespect intended—women who were very elegant who did this part-time and then they went on to their lunches and charities. There are two men here at the table, but I see it as a profession in [line] with any other profession. It wasn’t that way 22 years ago.
Let’s look at some issues impacting both women and men. Is New York going to become a “tale of two cities”? In the luxury part of the market, that is—a divide between the foreign mega-wealthy, who are here a limited number of days each year, buying eight-figure, trophy properties, and rich Manhattanites whose primary residences are on, say, Park and Fifth and who live and work here.
RS: As brokers, we have no problem accepting their tax money and [having them] underutilize our facilities and our services, which quite frankly only benefits the true New Yorker. That money allows us to do things in the city that we wouldn’t have normally been able to do had we not had these condos.
CF: If a foreign-entity LLC buys a $50 million apartment, it is paying basically $913,000 for taxes to the city and state and another $500,000 in mansion tax, which is all going into our city and state.
NB: Not everyone who lives on Park Avenue is primarily there. They have other homes they’re traveling to.
MFB: There are too many co-ops in this city for New York City to turn into London [with rich “ghettos” uninhabited for most of the year]. It’s not happening. What are the statistics [on co-ops], Noble?
RS: Seventy-five percent?
NB: It’s in the 70s. Foreign money gets the headlines, but the share of the condo housing stock is very small. Of the deals that get done, probably half of them are condo and then a fraction of that is foreign.
MFB: A lot of these co-op markets will not allow pied-à-terre ownership. So with that 70 percent in the co-op market, what would you say, 40 percent of them, 50 percent of them do not allow them, or even higher?
CF: I think only 25 percent allow a pied-à-terre, and I would say 15 percent will allow an LLC from an entity they know. With trust and estate planning, that’s very difficult. I own a townhouse, so obviously I can plan for trust and estates with that, but with a co-op you cannot.
Will the dollar strengthening in Europe have an impact on sales?
NB: With the high-end condos, it will. Certainly, if it continues, it will.
MFB: I think it will even the playing field, and Americans will get a chance to buy those condos.
CF: I also feel that with the dollar strengthening for many of my overseas clients, it’s made them feel even more motivated to want to invest in New York City.
Jonathan Miller, president and CEO of the real estate appraisal and consulting firm Miller Samuel, recently told The Real Deal, “I think you’ll see more expansion into the lower-upper [end of the market] than what we’ve seen. The demand is extremely high.” What do you define as the lower-upper end?
MFB: Up to $5 million.
NB: I would say anything below $2,500 per square foot. I think below $6 million to $8 million is really the cutoff. It depends on the size of the apartment. If you have a one-bedroom that is below $2 million, then it’s not going to fly, but if it’s a three-bedroom below $7 million or $8 million….
CF: There is a tremendously strong market for $3.5 million to $8.5 million apartments.
What do you see as the next phase of luxury in the outer boroughs?
CF: I love Riverdale. I used to live there. Those homes are so beautiful, so I can easily see that strengthening. And Brooklyn—the sky is the limit.
NB: But with the buildings, the level of luxury has not gotten anywhere close to Manhattan [standards] from what I have found. There are some nice buildings, but I don’t think overall you are talking about the same level. There’s a tremendous amount that can still go up.
Do you see a trend for smaller, boutique-style condo buildings in the future?
CF: I looked at a study of Downtown, and about 10 or 12 of the new developments, outside of Greenwich Lane, the Toy Building, and 150 Charles, were all smaller condominiums. And they all had a doorman.
MFB: What is great about New York is you have the divide. You have that client that wants the lobby and that magnificence. Then there is the buyer who just wants the intimacy of a small building.
NB: I find more people don’t want a doorman. They don’t want to have somebody there every night when they come in. If it’s got a virtual [doorman], then they’re happy with that. They don’t want to have to make conversation with someone.
MFB: Do you still think Manhattan is going to continue to grow? Do you think we’re going to level?
RS: I don’t see the frenzy anymore. I don’t think there are $30 million condo transactions in the quantity there were.
NB: I think it’s going to do slightly more than level. I think it’s going to go up, but at a much slower pace.
Any other trends you’d like to comment on?
CF: The thing about New York is it’s not a location-specific city anymore. View-specific, architecturally specific, high ceilings, large rooms, corner windows, sunlight, all of that specific. But it’s not, “Oh, I have to be in this 10-block radius.” I have found that has changed dramatically.
