NCYTheManhattanEffect

Interview withMichael Lanning, SeniorManhattan ResidentialMortgage ExpertPAGE 4

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Tavern On The Green IncarnationSky High ViewsThe Majestic On CPW, A Historical DetailPAGE 6

JULY - AUGUST 2010

INSIDE VERTICAL LIVINGA Frank Cuneo + Alan Levy Publication

Fairly Light ForeclosuresThough the national media may havehad a field day covering the country'sforeclosure crisis, Manhattan has es-caped relatively unscathed, thanks inpart to the strict financial require-ments that co-ops (which make up 70percent of the borough’s for-sale list-ings) have in place.“Equity positions in co-ops can rangeanywhere from 20 percent to 50 per-cent, therefore that doesn’t create alevel of speculation you’ve seen inMiami, Las Vegas, and Southern Cal-ifornia,” according to Frank Cuneo,real estate broker with Halstead Prop-erty. “You’re more likely going to beable to weather hard economic timeshere since the foreclosure market it-self doesn’t really affect Manhattan toany great degree.”Only one in 50,000 units have hit theauction block in Manhattan, he says.That’s in contrast to one in every 526homes in Los Angeles and one inevery 4,300 homes in Queens.

The First-Time FactorMortgage rates are also the lowestthey’ve been in the last 50 years. And,since the credit crisis has loosened upa bit, banks are now starting to fundjumbo loans (loans over $729,000),again with much better rates than afew years back. The bad news for

sellers, of course, is that prices havefallen between 10 percent and 30 per-cent. The good news? They can takeadvantage of those lower prices whenit comes to purchasing a new unit. It'sfirst-time buyers, however, who are inthe best position of all.“Buyers who have been on the side-lines because they’ve been priced outof the market now have inventory tolook at that’s cheaper,” explainsCuneo. “You can get a great price andpeople are jumping at that.”First-timers have a lot to think aboutwhen it comes to what type of homethey’re looking for. Condo or co-op?Which neighborhood? What kind ofamenities? And of course, one of thebiggest considerations of all: Howmuch?“Usually, with a first time buyer, priceis a very important factor in terms ofwhere they want to live. And also, atthe end of the day, you have to takeinto consideration what the resale fac-tor is going to be," says Alan Levy,real estate broker with Halstead Prop-erties. "People usually know thewhere they want to live. The questionis if they can afford the neighborhood.If they can’t we’ll try to guide them tothe cusp of the area.”

Value, Value, ValueThe old Mark Twain saying "Buy land,

they're not making it anymore” ringsespecially true in a borough with awhopping 71,000 people per squaremile. It's that density that helps keepup demand in Manhattan and, in turn,keeps property values steadier herethan in many other local and nationalmarkets.“Manhattan has always lagged on en-tering the recession and will lead inthe recovery,” according to Cuneo“There are a couple of basics thatmake the market strong: It’s verycompetitive, there’s only a certainamount of real estate, and there’s al-ways competition for the better loca-tions.”The days of buying a unit, adding afew bells and whistles and then put-ting it up for sale in order to make aquick buck are long gone, accordingto Levy. And that’s not necessarily abad thing.“Prior to this recession, everybodywas looking for luxury this and luxurythat – the Miele and the Bosch and allthe high-end appliances. Now thosethings don’t matter as much. Now it’sall about the value." he says. "If youbuy real estate in Manhattan and youtreat it like a true investment, not toflip it, but to keep it for five-plus years,you’re going to do well."

NCYINSIDE VERTICAL LIVINGA Frank Cuneo + Alan Levy Publication

TheManhattan Effect

You probably already know that Manhattan is the greatest place on Earth, and that making this 23-square-mileisland your home means a lifetime of cultural, culinary, and creative adventures at your doorstep. But diving intothe world of New York real estate can be daunting, whether you’re a renter looking to buy for the first time or areready to sell your current Manhattan apartment in order to upgrade, downsize, or just get a change of scenery.Despite the country’s recent economic downturn, those looking to purchase a home in Manhattan are still facinga better situation than those in many other markets.

Written By Joel Glass

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NCYINSIDE VERTICAL LIVINGA Vertical Living Strategic Partner Exclusive Interview

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When it comes to the mortgage meltdown and the fallout that followed, there have been plenty of theories about what went wrong and who’s to blame. But now, with the credit crunch loosening up, thegloom and doom dissipating, and sales activity picking up again, it seems many Americans are

moving forward. Still, many have questions about just how to go about getting a mortgage in 2010, a process thatlooks drastically different now than it did just a few years ago. Michael Lanning, senior mortgage loan officer withBank of America Home Loans lays it all out for buyers looking for answers.

INSIDE VERTICAL LIVING

Vertical Living’s Residential Expert Michael Lanning

Interview by Frank Cuneo + Alan Levy

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What’s changed the most about thefunding process recently? Michael Lanning: Over the last 15months, the lending process has re-verted from a low-documentedprocess — where borrowers used toprovide little or no income or asset in-formation and were able to quicklyclose — back to a fully-documentedprocess where every single loan isbeing analyzed to the nth degree. Notonly from the credit side, where we’reanalyzing income and assets, butmore importantly, from the collateralside, the actual property type. Banksare going to continue to be very cau-tious. They’re still lending, but thereare all of these variables that make itdifficult to move things at a fasterpace.

Should you get pre-approved for amortgage prior to starting yoursearch, even if you don’t have aspecific property in mind? ML: If you’re filling out a loan applica-tion and saying “I make x amount andI have this much money in the bank“without providing the backup docu-mentation to be verified, it meansnothing. I tell people it’s vital to pro-vide that information before gettingstarted. Most professional realtorswon’t even show properties unlessthe buyers have some type of pre-ap-proval, if, in fact, the buyer is lookingfor financing. Realtors want to makesure they’re talking to a qualifiedbuyer and that they’re showing theright price-point to that person. Andfor the buyer, you don’t want to findout after you’ve signed a contract thatyou’re not going to get the proper fi-nancing and put your earnest moneydeposit at risk.

What’s required these days inorder to get a loan? ML: It’s very simple: 30-day paystubsand your W-2s. And not only do wewant to see this year’s W-2, we wantto see last year’s too. We want to seecontinuity. Especially here in the fi-nance capital of the world, with the fi-

nance meltdown, bonuses are beingscrutinized too because they’ve beenturned upside down so lenders havebeen very apprehensive about includ-ing bonuses. If borrowers are lookingto potentially use their bonuses toqualify, we have to know exactly whatthe bonus history is and when they’repaid.

What about for someone who isself-employed? ML: The self-employed people havereally been hit hard in this whole mort-gage mess. We need tax returns, withall the K-1s, with all the schedules.We’re looking at cash-flow. You needto have some kind of documentationthat’s been filed with the IRS statingthat you’re self-employed and youneed to be self-employed for two fullyears.

We’ve heard lots of horror storiesabout buyers getting pushed intomortgages they couldn’t afford andgetting in over their heads. Whatsteps should a buyer take to makesure they’re dealing with someonewho’s going to help them with theproper loan and offer solid advice?ML: First and foremost, I think in thisenvironment you should be talking di-rectly to the bank. A mortgage brokeris going to sell themselves as “I know40 banks … and if someone has alower rate I’m going to get the lowerrate.” I don’t think that’s the best routeconsidering that each lender has theirown internal guidelines besides Fan-nie and Freddie’s. In case there’s anytype of wrinkle, appraisal issues, any-thing, you want to make sure thatyou’re talking to the bank directly.

What are red flags to look for?ML: Well, the best rate is alwaysgoing to drive where people go, whichmakes sense, but just make sure thatwhen you’re getting a rate quote theyput it in writing. If they email you andsay “Oh I can match that” or anythinglike that, I would be cautious becauseanyone can tell you what you want to

hear. But when you want to lock arate, if they can’t provide you, in writ-ing, that it’s locked in at the parame-ters that had been given to you, youshould be cautious about continuing.

What special considerations do co-op buyers in Manhattan have totake when trying to get a mort-gage? ML: Co-ops dictate about 65 to 70percent of residential real estate herein Manhattan and there could be nu-merous reasons why a co-op wouldn’tbe approved by a lender. Is there anylitigation? Any foreclosure processes?How much are they collecting per unitand then paying out for maintenance?Is it a positive cash-flow? Negative?And then there’s the issue of co-op in-surance. The managing agent needsto be on the insurance certificate, andthere are minimum requirements forinsurance and maximum deductibles.It’s a lot of the minutia. I try not to getthe borrower involved in because it’sso confusing, so I enlist as many peo-ple as I can to get the correct docu-mentation we’ve requested, therealtor, the bank attorney. There are alot of moving parts we need timely re-sponses to.

What’s the one piece of adviceyou’d give a first-time buyer?ML: You should be collecting yourdocumentation prior to even talking tosomeone about a loan. Once you un-derstand what we’re qualifying you onand what your credit is, it’s not asdaunting as you would think. And youshould be talking to a professionalwho will walk you through the stepsand help you understand the steps.With all the guideline changes, youneed to talk to someone who knowswhat they’re doing rather than some-one who’ll say “Oh I can beat anyrate.” You can get quoted any rate,but unless that person can actuallyfund the money at closing, that meansnothing.

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NEW PLANS FOR TAVERN “TACKY” ON THE GREENA new round of submission proposals from restaurateurs who would like an opportunity to operate one of the city’s most famous coveted dining oases.The plan would require the demolition of the Crystal Room (sheds a tear).The dining room currently looks like a bad banquet hall at a Holiday Inn .Vertical Living hopes it will land in the right hands, so New Yorkers, espe-cially urbanites on the UWS can enjoy a fine dining experience in CentralPark. The proposals involved include The Cipriani group, Donald Trumpand Dean Poll (operator of the Central park Boathouse). Let’s hopeBloomberg’s vision influences the decision makers. Vertical living is rootingfor an operator who will bring world class architecture and dining to one ofthe City’s most valued pieces of Real Estate. Manhattanites demandchange, let’s hope the transformation goes to an operator of quality andvalue versus flash and cash.

MANHATTAN’S RESIDENTIAL SUPER HIGH RISESVertical living in the sky – Most Manhattanites look out their windows to a familiar fishbowl of other buildings (and people) – but there are the fortunatefew who tower over everyone else, in apartments at the top of the skyline.Being almost 60 stories up having your morning cappuccino can make theworld seem surreal and gorgeous. Vertical Living has clients inquiring aboutthe super high rises that only Manhattan can offer. Trump World Tower at845 United nations Plaza at 900 feet is one of the tallest residential buildingsin the world. The Department of buildings does not keep track of these superhigh rises so to find one you must look up and once you find these super-high rise apartments they don’t come without a key to the world price tag.The Wow factor is often worth the premium price tag and most owners usethese spaces for entertaining and wooing business associates who often gohome to their lackluster views compared to the eagles of the sky.

A MAJESTIC HISTORYFeatured Property of the Month. Each month we feature a building VerticalLiving finds special.A little History:Upper West Side, Manhattan

The Majestic is one of five towered skyscraper apartment buildings whichdefine the impressive skyline of Central Park West. Erected in 1930-31 bythe Chanin in Construction Company, headed by architect and developerIrwin S. Chanin, it is an excellent example of the Art Deco style in its stream-lined later phase. Chanin had attended the highly influential 1925 Paris ex-

NCYINSIDE VERTICAL LIVINGA Frank Cuneo + Alan Levy Publication

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position of decorative arts, and re-turned a convert to the "modernistic"style. The Majestic was the Chanin or-ganization's first "experiment" ̂ in ap-plying the Art Deco style to residentialbuilding. The Majestic successfullyadjusts the city's housing laws to thenew style; its soaring twin towers area response to new regulations en-acted in 1929. Although built duringthe Depression, it belongs to the lux-ury apartment building genre of the1920s. While the Majestic's sparinguse of ornament and simple materialsreflect its date of construction, the re-sulting austerity is an integral part ofthe building's stylistic imagery.

Central Park West, the northern con-tinuation of Eight Avenue borderingon the park, is today one of NewYork's finest residential streets, but inthe mid-nineteenth century it was arural and inhospitable outpost, no-table for its rocky terrain, browsinggoats and ramshackle shanties. Withthe creation of Central Park in the1860s, followed by Riverside Park(begun 1876), as well as a series oftransportation improvements such asthe Ninth Avenue Elevated Railroad(1879), the Upper West Side in gen-eral experienced a period of intensereal estate speculation. The 1880swere the first decade of major devel-opment, and set the pattern for theUpper West Side, where rowhousesline the side streets, and multipledwellings, commercial and institu-tional structures are sited on the av-enues.Not surprisingly, those avenues clos-est to the parks, Central Park Westand Riverside Drive, were immedi-ately considered the most desirable.The potential of the parkside avenuesfor development as prime locationsled to an anticipatory increase in landvalues; prices rose to such extrava-gant heights that many speculativebuilders shied away from row houseand tenement construction, fromwhich they would realized relativelymeager returns, while the verywealthy, who could afford to buildmansions for the most part remained

on the more fashionable East Side.

The Majestic is a thirty-one storyapartment building with a massivenineteen-story base which conformsto the lot line, extending from 71st to72nd streets along Central Park West,and 225 feet westward along 72ndStreet, 187.6 feet along 71st Street,with an interior courtyard.

Setbacks begin at the fourteenth storyand continue to the nineteenth, abovewhich rise the large twin towers. Thethree main entrances appear on eachfacade and are enframed by rose andblack polished granite which alsoforms the watertable. These enframe-ments are simply detailed withgrooves. Office doors also appear atthe first story. The first three stories ofthe building are faced with light graycast stone. Where the piers appearthis stone has been ornamented withnotches above the third story.

The building from the fourth story upis faced in yellow brick. At the cornersof the building, including the towers,the brick has been laid in a striatedpattern between the windows. Unin-terrupted piers articulate the base ofthe building on all three facades di-rectly beneath the towers, and alsoappear on the side elevations sur-rounding the entrance bays. Thesepiers also continue in the towers, cre-ating a strong vertical element in theelevations. Beneath the windowswhich are flanked by these brick piersare panels of simple rectangular tiles,which form a slight convex curve, an-imating the wall surface. At the set-backs terraces are surrounded bysimple metal railings. The originalwindows contain metal casementswith upper and lower transoms.

The windows are varied in size, butthe majority are bi- and tripartite.Some tripartite windows have side-lights. Single-paned windows appearbeneath and in the towers, emphasiz-ing their verticality, while windows withthree panes, appear elsewhere andprovide a horizontal counterbalance.

The comer wrap-around windowscontain three sections, with threepanes on the north and south sidesand eight sections with three paneson the east. The square-headedtower terminations on the east eleva-tion above the piers are ornamentedwith simple abstract sculpture, typicalof the Art Deco style. The rounded ter-minations on the wings at the westsides of the towers are faced in stoneand are again typically Art Deco.

- From the 2010 NYCLPC LandmarkDesignation Report

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