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Mentioned in this Article:
Stephen G. Kliegerman

Stephen G. Kliegerman
President of Development Marketing

Crains

Unbuilt Condos Selling Like It's 2006 On Ues

With only the foundation completed, Toll Brothers has already sold 16 of the planned 22 units in its 15-story condominium on East 65th Street and Lexington Avenue—despite weekly price hikes.

By Amanda Fung


Apartments at Toll Brothers' luxury condominium tower on the Upper East Side are already flying off the shelf. That's no mean feat given the still-weak market and the fact that the 15-story, stone-faced building at the corner of Lexington Avenue and East 65th Street doesn't yet even exist. At this point, only the foundation is done.

Since opening a sales office just a month ago across East 65th Street, 16 of the 22 units at the project, dubbed The Touraine, have gone into contract, according to Toll Brothers City Living—the urban development division of the Pennsylvania-based, high-end home builder. When a unit is released, it is sold within a week, said Scott Avram, an assistant vice president at the firm's New York division. Apartments range from the 1,542-square-foot, two-bedroom, two-and-a-half-bath variety on up to 3,695-square-foot, full-floor penthouses.

“It feels like we're selling units in 2006,” said Mr. Avram, adding that it has more than 3,000 folks on the waiting list for units. “It's our fastest-selling building in the city. The sales velocity is based on a lot of little things.”

Developers have not been able to sell apartments off of floor plans since the height of the market. To help with sales, Toll Brothers developed a private Apple iPad app to show potential buyers 3D layouts of the building and floor plans.

In the most telling sign of all, Toll Brothers has now raised prices every week since launching sales. Currently, the average sales price is roughly $2,800 per square foot, up 25% since it first began sales. The 10% deposits on 16 of the units have been collected already.

“We intend to raise prices again very soon, thus again increasing the average price per square foot,” said Mr. Avram, adding that all of its buyers so far are all-cash and “uber rich with multiple homes.” A few are even leaving the famed four-year-old 15 Central Park West.

The lack of inventory is also in Toll Brothers' favor. “There's a lot of pent-up demand out there for condos on the Upper East Side. There is no new inventory west of Third Ave.,” said Stephen Kliegerman, president of Terra Development Marketing. “It's a prime neighborhood, steps away from Park, Madison and Fifth avenues.”

The French-inspired building, designed by Lucien Lagrange of VOA, boasts a library, wine cellar with private wine lockers for residents, fitness center and a landscaped rooftop terrace with an open-air fireplace. There are gourmet kitchens in each unit, a model of which can be viewed in the sales office, featuring Gaggenau and Sub-Zero appliances and Italian Calcutta Marble.

Still up for grabs are a two-story, 4,346-square-foot penthouse with five bedrooms and five and half baths at the top of the building and a 3,695-square-foot penthouse with four bedrooms and four and a half baths on the 11th floor. Both units have not been released yet for sale, but when they are Mr. Avram expects to have a buyer almost immediately. “The building is selling out fast,” he added.

Meanwhile, steel is expected to begin rising on the site in a few weeks and the project should be finished at the end of next year. Mr. Avram declined to disclose development cost for The Touraine, but noted that the project is self-funded by Toll Brothers so construction financing was not an issue.


Tuesday, November 15, 2011