Does Manhattan Have a Luxury Real Estate Problem?

New York City — and Manhattan especially — is home to some absurdly opulent apartments occupied by the wealthy and powerful. This year has brought with it coverage of Jeff Bezos’s NYC apartment and a few other prominent figures, including Annie Leibovitz and David Duchovny, selling their Manhattan homes at a loss. But the real estate transactions of household names are only part of the larger story of Manhattan real estate — and part of that story also includes the luxury apartments that no one is buying.

That’s one of the biggest takeaways from a new article by Kim Velsey at Curbed. The article cites one analysis of the apartments on Billionaires’ Row that indicates that, as Velsey phrased it, “23 percent of sponsor units remain unsold.” (The actual figure may be even higher.) In a city where many residents want more affordable housing options, it’s a strange twist of fate that the one type of residence that does seem to be widely available comes with an eight- or nine-figure price tag.

It does mean that if you’re in the market for a trophy apartment, there are relative bargains to be had. Velsey cites data to the effect that units at Central Park Tower are selling for, on average, a 25% discount. In Hudson Yards, that figure is even higher — closer to 40%.

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The case of Hudson Yards points to one of the issues facing this highest of high-end sectors of the real estate market right now: location matters for good and for ill. Given that the history of Hudson Yards hasn’t turned out as planned, it’s not surprising to see luxury apartments there going unsold — which could create a conundrum now and in the future for the companies that built those residences and were counting on higher sales therein.