New York City's 'Billionaire's Row' is dead - and a record-breaking foreclosure could be the 'nail in the coffin'
This is most likely the largest foreclosure in the history of high-end real estate in New York City, experts say.
"I don't know of a foreclosure that's larger than that," Donna Olshan, president of Olshan Realty, told Bloomberg.
The apartment, which was the eighth-priciest sold in the building, will go to auction on July 19.
It was purchased for $50.9 million in 2014, with a $35.3 million mortgage loan from Banque Havilland. It was due to be paid in full a year after purchase, but no such payment was made by the shell company the unit was registered under. Havilland is now forcing the auction to recoup the funds it's missing, plus interest, according to court filings.
One57 is emblematic of New York City's Billionaire's Row, a stretch of 57th Street near Central Park, which in recent years has become a magnet for new condos courting high-priced investment. One57 is considered the most expensive of the new buildings, with record-breaking sales that included a $100.5 million top-floor penthouse.
This is the second apartment in the building to face foreclosure in the last two months. A unit on the 56th floor, which sold for $21.4 million in July 2015, hit the auction block on June 14. It's unclear if the property has changed hands yet.
The foreclosures come as another sign that Billionaire's Row is dead as the Manhattan real estate market above $10 million continues to cool.
A glut of units available with no buyers, combined with an increase of scrutiny on shadowy, identity-hiding corporations by the US Treasury Department, cooled the market considerably last year. With new regulations on capital outflow abroad (especially in China), it's becoming harder for foreign investors to use these apartments as investment properties. Pair that with an uncertain global market, and it's clear why the developers of these unique buildings are feeling the pinch.
On Billionaire's Row, "it's not just slow - it's come to a complete halt," Dolly Lenz, a real-estate broker catering to super-rich individuals, told the New York Times last year.