Broker Alon Chadad's client bought a US$14.3 million apartment on Manhattan's Central Park South, then spent nine months seeking approval for plans to overhaul it.
In January, the buyer changed course, listing the unit for sale at more than double what he paid just a year ago.
"He filed all the documents for renovation and he was ready to go and he decided, 'You know what? I see opportunity in the market'," said Chadad, co-founder of Blu Realty Group and the agent for the 6,160 square-foot flat, which has a new asking price of US$29.5 million.
Luxury-apartment owners in New York are listing a record amount of properties for sale, testing the upper limits of what buyers are willing to pay even as median prices remain off their peak set almost six years ago. Sellers have taken notice of a handful of record-shattering deals, triggered by an US$88 million purchase at 15 Central Park West, and demand for trophy homes by international investors seeking havens for their cash.
There were 145 Manhattan residences listed for more than US$20 million last year, the most in records dating to 2005, according to data from StreetEasy.com , a real estate website. The average asking price per square foot of those homes was US$4,977, 18 per cent more than the year before and also the highest on record. Two resellers are asking at least US$100 million for their properties.
Such sky-high valuations may not fully reflect the market. While the number of apartment sales for more than US$10 million, about the top 1 per cent, more than doubled last year, the median price of those transactions was US$13 million, or 7.9 per cent less than such properties sold for in 2008, the year Manhattan residential prices peaked, data from appraiser Miller Samuel show.
"There's definitely an argument to be made that some apartments are asking prices that make absolutely no sense whatsoever," said Leonard Steinberg, a luxury broker with Douglas Elliman Real Estate in New York. "Everybody wants US$100 million for their apartment these days." The US$88 million sale, by former Citigroup chairman Sanford Weill two years ago, was the "starting gun" for the frenzy, according to Jonathan Miller, president of Miller Samuel.
The 6,744 sqft, four-bedroom home, featuring a wrap-around terrace, was purchased for the daughter of Russian billionaire Dmitry Rybolovlev.
Since then, two contracts have been signed at more than US$90 million each for apartments at Extell Development's newly built One57 tower. Bill Ackman, founder of New York hedge fund firm Pershing Square Capital Management, is part of an investor group that agreed to buy one of the apartments, a duplex spanning the 75th and 76th floors of the 90-storey skyscraper.
A penthouse at nearby 432 Park Avenue found a buyer who agreed to pay US$95 million. Buyers in the tower, set to be Manhattan's tallest residential building when finished, have come from South America, the Middle East, China and Russia, according to developers Harry Macklowe and CIM Group.
Sellers of Manhattan homes priced at US$10 million or more in 2013 had to cut 15 per cent from their original asking prices to strike a deal, up from a 10 per cent cut in 2008, Miller Samuel data show. Properties in that range spent an average of 347 days on the market, the most since 2007.
For apartments priced at US$20 million or more, the average price cut was 12 per cent last year, compared with 15 per cent in 2008, according to StreetEasy.
Steven Cohen, the billionaire founder of SAC Capital Advisors, is still seeking a buyer for his 9,000 sqft penthouse at One Beacon Court.
He initially sought US$115 million for the duplex, which is the only one in the 53-storey tower, according to StreetEasy, for which he paid US$12.9 million in 2005.
In December, he cut to US$98 million, for the four-bedroom property, described in the listing as "a unique NYC treasure" with interiors designed by Charles Gwathmey. Two walls of windows in its double-height living room overlook Midtown and Central Park.
Brokers Deborah Grubman and David Dubin of Corcoran Group, declined to comment.