After some pessimism in April and a little more optimism  in May, the rental market (well, the landlord side of it) seems to have settled into cautious cheerfulness as the summer winds down. Or at least, that’s how the folks at The Real Estate Group New York are feeling. This month, rents are up only a small 0.37 percent since July, but they’re up 4.64 percent since last August. Vacancy has fallen again, and landlords are turning a slightly less friendly on temporary walls put up by residents hoping to bring in a few roommates and save money. Sorry, renters!

Of course, the rental market in every ‘hood doesn’t bounce back at the same time, and TREGNY sends bargain-hunters and sharers to the Upper East Side, where non-doorman 2BR rents fell nearly 5 percent from July to August. Only Harlem saw more of a 2BR drop. The neighborhood breakdown:

ASTORIA—Astoria’s Piano Factory condos went rental, so what in the neighborhood is actually selling? According to reps for the building, the 36-unit Plaza 21 at 23-01 21st Avenue  is half sold. Maybe Queens buyers hate classical music? Plaza 21 also has that new Astoria look that’s so, uh, popular these days. Prices start at $312k and units range from 520-square-footers to two-bedrooms checking in at 1,129sqft. [CurbedWire Inbox]

BEEKMAN—We rarely dust off the Beekman neighborhood name but we’ll do it for 420 East 51st Street, aka the Morad Beekman. A tipster writes of the 15-story post-war co-op: “The maintenance at the building recently went up 53%! It is a land-lease building and was always difficult to sell, but now it seems like it will be impossible to sell. Plus, they don’t allow weekend open houses. The tenants are trying to sue (whom?) but good luck.” A StreetEasy commenter recently noted that the maintenance on a penthouse went from $3,924 per month to $6,017 per month. Not quite 53%, but yikes. [CurbedWire Inbox]

In this On the market, Good Day New York’s Christal Young looks at three local properties between $300,000 and $350,000. She goes inside a Colonial in Wood-Ridge New Jersey. Then she compares it to a 1-bedroom in a new construction building on Gates Avenue in Clinton Hill, Brooklyn, and a studio apartment in Battery Park City, Lower Manhattan.

LISTING #1: FEATURED HOME
339 Windsor Road
Wood-Ridge, NJ
$329,900
3 bedrooms, 2-1/2 baths
David Fanale (201) 288-5533

LISTING #2
315 Gates Avenue
Clinton Hill, Brooklyn
$325,000
1 bedroom/1 bath
New Development Division, The Developers Group (718) 230-0100

LISTING #3
2 South End Avenue #5J (studio)
New York, NY
$300,000
Studio
Frances Katzen, EVP, Prudential Douglas Elliman (212) 350-8575

Bad news for college grads moving to Manhattan: You can’t live here for under $1,300.

The Real Estate Group of New York’s latest Manhattan Rental Market Report went live on Tuesday morning, and it shows rents in July ticking up. That’s reassuring for landlords and worrisome for first-time renters. Your friends who entered the market last year may still be riding on the recession-era glut of incentives, such as a couple months of free rent, but chances are you won’t be so lucky.

“As a rule, if you’re living in Manhattan, it’s not impossible, but it’s very hard to find anything under $1,300 or $1,400,” said Gus Waite, vice president of the rental division of The Real Estate Group New York, a local brokerage.

Asked whether it was possible to rent for a thousand dollars a month (or less!), Mr. Waite wasn’t optimistic. “I wouldn’t say there’s no way. It’s a tall order. People always say, ‘My friend…’ But your friend wasn’t renting in July 2010.”

Rents aren’t actually that much higher than last year. Average rents are up 0.72 percent from June and up 3.62 percent from the same period last year. The average rent for a non-doorman studio is $2,077, while a doorman studio is $2,367 (last year: $1,958 and $2,337, respectively). A non-doorman one-bedroom is $2,713, while a doorman one-bedroom is $3,428 (last year: $2,590 and $3,276, respectively). It’s cheaper to have a roommate, but not by much. A non-doorman two-bedroom is $3,680, while a doorman two-bedroom is $5,327 (last year: $3,590 and $5,197, respectively).

Still, many of the symptoms of last year’s renter’s market have vanished. As Mr. Waite said, “The market is almost back to normal,” which means incentives are rarer. Don’t expect, for instance, to be offered two months of free rent, a common practice in 2009. Also, don’t expect to be allowed to put up a temporary wall. The service, which can save renters a bundle, is starting to be more closely scrutinized for legality. Now that landlords aren’t so desperate, they’re getting stricter about checking for permits.

“The laws haven’t changed in 80 years. It’s the interpretation of the codes,” Mr. Waite said. “You have to get a permit. For years people didn’t get permits because people were doing so many. But now, if they check, you could get fined or in trouble.”

Because of the dearth of incentives, the buildings still offering them are getting special attention. The Financial District and Stuyvesant Town, where free rent deals still exist, are starting to look more attractive.

Mr. Waite said he doesn’t expect rents to go down. But he also doesn’t expect them to go up. He predicts they’ll remain fairly constant for the rest of the summer. Which means you have a few more leisurely weeks to pick out a place before school starts—or doesn’t—in the fall.

AFTER graduating from Duke University this spring, Karan Sabharwal landed a job in finance in New York City. He had a plan to make Manhattan living affordable.
He would lease a nice one-bedroom apartment, convert it to a two-bedroom space with a temporary wall and split the rent with a friend.

Marcus Yam/The New York Times. Danny Moreno of All Week Walls puts the frame up for a temporary wall that will create a bedroom in a New York apartment.

But when he went to check out the Rivergate, a high-rise apartment building in Kips Bay, he was told by the property manager that partitions were no longer allowed.
“I told her I had friends in nearby buildings that had put up the walls,” he said. “She said, ‘We have adopted the policy, like many other buildings in the neighborhood, that you will not be able to put up the full wall anymore.’ ”
As the city aggressively enforces a long existent but widely ignored code, walls are falling across Manhattan, radically altering the housing landscape for scores of young professionals. Thousands of renters are being told that the walls that have been put up over the years without approval from the Department of Buildings must come down. And new renters are being informed that if they wish to divide a space, they will need to rely on bookshelves or partial walls that don’t reach the ceiling.
“The impact has already been dramatic,” said Gordon Golub, the senior managing director for rentals at Citi Habitats. “Landlords are all trying to come to some sort of conclusion as to what they are going to do in allowing any walls or a different sort of wall that might go up, and it is affecting brokers and customers.”
Manhattan apartments are as varied as the roommates who decide to share a place. Because of this, there are no rules that apply universally. But in all cases, temporary walls must not block exit routes or interfere with the ventilation and sprinkler systems. And there are minimum requirements for room size.
The current focus on temporary walls is driven by two developments: prosecutors’ decision to level manslaughter charges at the owners of a building where a fatal fire occurred in 2005 and, more recently, the city’s drive to eliminate illegally installed temporary walls in Stuyvesant Town, the sprawling complex between 14th and 23rd Streets on the East Side.
After tenants’ complaints and subsequent inspections by both the Fire Department and the Department of Buildings, Tishman Speyer, the owner of Stuyvesant Town, embarked this spring on a review of all its apartments and moved swiftly to eliminate all walls that were not up to city code.
“It was determined that partition walls previously installed in some apartments were not in compliance with the New York City Building Code,” the company said in a statement. It declined to go into the extent of the complaints or who had lodged them.
Tishman Speyer is paying for the removal of the walls. It is also footing the bill for the installation of approved replacement walls for those tenants who had the landlord’s permission to build temporary walls.
City officials note that it has long been illegal to install a floor-to-ceiling wall without a permit from the Department of Buildings, even though landlords as well as tenants have often disregarded this requirement. But the strict enforcement at Stuyvesant Town has prompted many landlords to get into compliance.
The Manhattan Skyline Management Corporation, which manages thousands of luxury apartments across Manhattan, including the Rivergate, has been examining its entire portfolio to establish where walls were erected. The company has already informed hundreds of residents that even if they installed walls with the building’s approval, or moved into an apartment that already had such walls, they will have to rip them out if they are not up to code.
In a statement, the company said that because the Department of Buildings had “greatly restricted” the use of walls to subdivide rooms, “previously installed walls which were believed to be legally installed have to be removed.”
The company is offering tenants who erected walls with its approval $700 to help defray the cost of erecting new dividers, like bookshelves. But for many residents, a bookshelf or a partial wall is no substitute.
“It’s not only inconvenient, but heartbreaking, since we love our apartment just the way it is,” said Daniela Zakarya, 25, and a broker at the Real Estate Group of New York.
Ms. Zakarya, who moved with her college roommate into a Gramercy-area apartment a year ago, said the wall had been in place at the time. She was informed in April by her landlord — whom she did not want to identify since she is still negotiating a solution — that the wall had to come down. A week later it was removed, and now the living room has become the second bedroom while the roommates decide what to do next. “It is a cataclysmic change and is the future of Manhattan share situations,” she said.
Ms. Zakarya quickly realized she was not alone. Many of her clients are young professionals looking to share places in doorman buildings where the average rent for a one-bedroom ranges from $3,000 to $3,500. As she has shown apartments in recent weeks, she said some potential renters have been surprised to find that the cost-saving room-splitting arrangements their friends made just a year ago are no longer an option. And the bookshelves, screens and partitions replacing walls inevitably result in a loss of privacy.
“Everyone who wishes to save money on rent and convert their apartments may need to get used to this,” Ms. Zakarya said.
Tony Sclafani, a spokesman for the Department of Buildings, said the city’s regulations had not changed. He emphasized that a work permit had always been required to add a wall.
“The addition of a partition, pressurized wall, or other floor-to-ceiling divider, even if intended as a temporary installation, results in a change to the layout of an apartment,” he said.
To get a work permit, one must hire an architect or engineer to prepare plans of the proposed layout and other construction details as well as to apply for plan approval, Mr. Sclafani said. After the plan is approved, the contractor must get a work permit. After the work is complete, the architect or engineer must inspect it and then sign off on the job at the Department of Buildings.
Certainly, thousands of renters have skirted these rules in the past without penalty. The Department of Buildings does not randomly inspect residences, and mostly acts in response to complaints.
But ever since a deadly fire in a Bronx apartment building in 2005 in which two firefighters died after leaping from a window, the city has had illegal room dividers in its sights. Prosecutors charged the building’s former and current landlords, as well as two tenants, with manslaughter. The city’s position was that illegal partitions erected by the tenants to subdivide the apartments had disoriented the firefighters and led to their deaths.
The tenants, who were said to have installed the partitions to create small, windowless rooms that they then rented out for $75 to $100 a week, were acquitted.
The owner and former owner were convicted of criminally negligent homicide by a separate jury. But that verdict was overturned in February by the State Supreme Court, which found the prosecution had failed to prove the defendants had known about the illegal partitions.
Since that fire, the Department of Buildings has cracked down on the most dangerous situations, issuing 1,200 vacate orders in 2009 for people living in illegally subdivided apartments, the majority in Queens. Manhattan shares drew little attention until recently, when landlords and real estate agents could not help hearing the rumble of walls falling in Stuyvesant Town.
Because apartment layouts vary widely, it is difficult to generalize about what types of walls meet with city approval, but officials at the Department of Buildings said the major considerations had to do with “egress routes” to ensure “maximum travel distances in the building code are not impeded, sprinkler coverage areas (where sprinklers are provided) are not obstructed, smoke detectors and carbon monoxide detectors are relocated or supplemented if necessary to comply with the building code.”
Any electricity work must also meet guidelines. “Keep in mind that the elimination of a common living room to create a three-bedroom, zero living room apartment may result in a rooming-unit situation that is not permitted by the Housing Maintenance Code,” Mr. Sclafani said. “In addition, since each apartment is generally required to have at least one room of at least 150 square feet, the installation of a partition may run afoul of this requirement in certain cases.”
He said anyone with questions about whether an apartment is up to code can call 311 and request an inspection by the Department of Buildings.
In any case, despite the firm stance taken by some major property owners, thousands of renters are still using pressurized walls, which are relatively inexpensive, easily installed and easily removed.
Donny Zanger, the project manager at All Week Walls, which specializes in installing and removing pressurized walls, said his business was so far unaffected.
“We are growing like crazy,” he said.
“If these walls did not exist in New York,” Mr. Zanger said, “it would be a very difficult situation for students and young professionals and even professionals who make more money.”
He says he follows all the city codes and regulations when installing a wall. He also says he does not understand how erecting large bookshelves to divide a space is any safer than properly installing a pressurized wall.
In practice, it has not been the responsibility of the installation companies to obtain the necessary building permits; it has been the landlord’s or the owner’s. But many companies use their Web sites to advise potential customers to secure approval from building management.
The cost of a wall starts around $700, and Mr. Zanger said his company had put up 300 to 400 walls in the past year. There are dozens of similar companies — a testament to just how common the practice of dividing rooms in Manhattan has become over the years.
It remains to be seen whether many landlords will follow the lead of Stuyvesant Town and other major property owners in Manhattan, but during a June meeting of landlords and brokers hosted by the Real Estate Board of New York, it was the hot topic.
Meanwhile, many renters new to the city find themselves in a position similar to that of Mr. Sabharwal, the Duke graduate.
“I heard that if you have a month, that is plenty of time to find something,” he said. But in light of the crackdown on temporary walls, his options seem more limited and he might have to reassess his $1,600 budget.
“It is a whole different experience than my friends had,” he said.

 
The brand-new $200,000 luxury condo still lives in Brooklyn!

In fact, the unit is even cheaper — it’s actually $195,000. Yes, the condo is small (a 435-square-foot studio) and the building is in Bed-Stuy (well, it’s close to Clinton Hill). But this is the jaw-dropping starting price at 315 Gates Ave., a 72-unit building designed by Karl Fischer and slated for occupancy in the fall.

And if that low figure doesn’t pique your interest, it should be noted that the building is awaiting FHA approval. This means you may be able to buy a unit for 3.5 percent down.

 
CHEAP THRILLS: Studios are starting at around $200K at 315 Gates Ave.Of course, most of the units at 315 Gates are more than $200,000 — a 1,566-square-foot duplex goes for $550,000. The building’s luxury offerings include kitchens with stainless-steel appliances, and bathrooms with Italian porcelain and deep soaking tubs. And the building has a cyber doorman, parking, a roof terrace and a screening room.

Read more: http://www.nypost.com/p/news/business/realestate/residential/gates_keeper_etU7htzRgz5CEWMCSBCp6L#ixzz0ts1MKRfh

Location: 315 Gates Avenue in Bedford-Stuyvesant
Size: 72 units
Prices: Prices begin at $195,000 for a studio
Architect: Karl Fischer (with interiors by Durukan Design)
Developer: Select Holding Corp.
Sales & Marketing: The Developers Group/TREGNY
Lowdown: Straight from the mind of Karl Fischer to the Bed-Stuy/Clinton Hill DMZ is 315 Gates. The building gets the Post treatment today thanks to its prices, which start at $195,000 for a 435-square-foot studio (FHA approval is also pending). At the higher end, there’s a 1,566-square-foot duplex for $550,000, and the amenities menu includes luxury touches in the kitchens and bathrooms, a cyber doorman, parking, roof terrace, and screening room. (And, according to the placeholder website, it’s “one block from the state-of-the-art YMCA.”) No interior renderings yet, but a press release from the sales team tells us occupancy is slated for this fall. Will those prices get potential buyers to jump in?
· Official Website: 315 Gates Avenue [315gates.com]
· Gates keeper [NYP]

Bed-Stuy Blog.com

I’ll be the first one to admit that I was a little sad to see them demolish the building that once stood on the corner of Gates and Bedford, because I thought it was a beautiful building and I had secretly hoped that it would be restored. These days I don’t feel so bad about my loss, because the new building erected in its place, 315 Gates Avenue, is a modern beauty, the modern equivalent of the building it replaced.

The 72-unit Karl Fischer designed condominium building has just launched sales with prices starting at $195K, and the building is awaiting FHA approval, so qualified buyers will have the option to put down as little as 3.5% for their new digs. The units have 10-foot ceilings, central heating and cooling (no Fedders!), washer/dryer hook-ups, pre-wiring for Verizon FIOS, and video intercoms. Some of the units also have private outdoor space. The building includes studio, one-bedroom and two-bedroom units with a common rooftop terrace, refrigerated FreshDirect storage, a residents’ lounge, a movie screening room, bike storage, onsite parking and private storage facilities. The marketing materials also tout the building’s cyberdoorman “providing 24-hour virtual concierge service.” I have no idea what a cyberdoorman is, but if it means that I don’t have to give him $200 on Christmas Day, then it’s all good.

David Behin, partner of The Developers Group, says that “Brooklyn has never seen this level of luxury living at such an attractive price point,” and I’m inclined to agree with this assessment–as far as amenities go, this building, in my opinion, is quite attractive. It may be the most attractive that I’ve seen ’round these parts. I think what I like most about this building is that at six stories, it doesn’t appear to be much larger than the building it replaced and the colors of the building blend in with the colors of the surrounding buildings.

What do you think of 315 Gates?

Occupancy is slated for fall 2010. If you’re interested and want more information or to if you want to schedule an appointment, call 718-230-0100 or visit the website at www.315Gates.com.

By William Alden

 
“People always ask about the development across the street,” broker Kevin Ferrara said, gesturing toward an empty lot out the window of a first-floor condo at 29 South Third Street in Williamsburg. “So I’m going to tell you.”

The lot, overgrown with weeds and rimmed by a chain-link fence with a barbed-wire coil, formerly contained part of the Domino sugar refinery. The “development,” which was approved by City Planning earlier this month, and which is slated to take 10 years to complete, will be a luxury residential building, much like the others springing up around Williamsburg’s north side.

The neighborhood is not beautiful. It seems to enjoy the worst of two worlds, either old and run-down or new and, as mortgage loan officer Mark Friedman said, “cookie-cutter.” Still, people want to move there. For some, it’s the only place they want to be.

In a $749,000 two-bedroom at 125 North 10th Street, broker Stefani Shock prepared for a six-hour open house. The new condo development is selling well, she said. Her firm is closing about six apartments a month. “We’re at the finish line,” she said.

Ms. Shock described prospective buyers in Williamsburg as “artists with a budget”—but apparently not a huge budget. “For people who want space but can’t afford Manhattan, this is the default neighborhood,” she said. Does that mean they’re settling for less?

“I mean ‘default’ in a good way.”

Some see Williamsburg as a second best. Ayelet Levron, 33, a software developer from Israel, who now lives in Astoria, looked at a $575,000 two-bedroom at 5 Roebling Street. She aims to save money. “It’s not Manhattan, but it’s close,” she said of the neighborhood. “You can get much more here.”

But Ms. Levron may be an exception. Prices, which aren’t actually that low, are not the neighborhood’s main draw.

Steve Leven, 42, and his wife Mira Trezza, 35, wandered around a $610,000 two-bedroom at 268 Wythe Avenue. Mr. Leven, the owner and founder of Irving Farm Coffee, who has lived in New York City for 20 years and now makes his home in the West Village, isn’t looking outside Williamsburg.

“It’s close to the subway, a little industrial,” he said of the neighborhood. “We really like the energy, the wide-open spaces.”

Ms. Trezza, who hails from Bulgaria and works with Mr. Leven at Irving Farm Coffee, corrected him.

“We like the hipsters,” she said.

Mr. Leven rolled his eyes. But Ms. Trezza was on to something. It’s the residents, and not much else, that make north Williamsburg a desirable (or undesirable) community.

Down Wythe Avenue, the sound of vuvuzela horns spilled out to the sidewalk from Zebulon, a bar where several dozen Billyburgers sat, stood or perched in front of a television showing the Brazil-Cote d’Ivoire soccer game. It was still the first half, and Brazil led with one goal. Lucio, the Brazil team captain, took a dramatic dive.

The onlookers jeered. “Oh, pobrecito!” someone shouted.

Farther north, on Bedford Avenue near McCarren Park, a mustachioed 20-something wearing a blue beanie and snug khaki shorts stood on a ladder and hosed down a building’s brick wall. An older man, passing by, chanced into the crossfire. “Asshole!” he shouted in accented English, chasing the outburst with more obscenities. The kid seemed not to hear.

Back at 29 South Third, Mr. Ferrara showed Ari Shimada, 38, and her husband Atsushi Yokada, 45, a series of one-bedroom condos. Mr. Yokada is a chef at 1 or 8, a Japanese restaurant in Williamsburg, and the couple is moving to Williamsburg from Manhattan to accommodate him. Ms. Shimada doesn’t like the idea of commuting to midtown for her work as an accountant, but she’s open-minded.

“Most likely this is out of our budget, but we just wanted to see,” Ms. Shimada said, standing in a $636,000 one-bedroom.

Williamsburg’s new developments aren’t cheap, and visually they stand out from the landscape. Mr. Friedman, the mortgage officer, greeted prospective buyers at 66 North First Street. He acknowledged that some of his clients are turned off by ultra-modern exteriors but said that when they step inside, “they’re always impressed.”

Alison, a prospective buyer at 5 Roebling, who wouldn’t give her last name, echoed those reservations.

“Everything’s very new. You know, modern condos,” she said, riding the elevator down to the lobby after leaving the open house. “There’s no old buildings. Which is nice, but…” She paused. “It’s just new.”

Outside Vinnie’s pizzeria on Bedford Avenue, a chalkboard advertised vegan slices. The place has been in business since 1960, but the current owners, Jacob Petrera and two of his friends, bought it three years ago and added “specialty slices” to the menu.

“Me and my buddies started doing this in college—trying crazy styles,” Mr. Petrera said. “We bought this place and kind of brought in our own flavors.”

The Observer sampled the vegan “chicken parm” pizza. The chicken, though fake and itself new to the area, was delicious.

walden@observer.com

By Amanda Fung

Despite years of community opposition over its size, a financial crisis that briefly threatened to halve its height, and falling debris that rendered neighboring streets hazardous, the city’s tallest residential spire will officially open its doors in about six months.

And after all that, the 867-foot Beekman Tower is already being hailed as a winner. In a remarkable about-face, many community officials expect their new 76-story, Frank Gehry-designed neighbor to raise the profile of the entire area. Meanwhile, real estate brokers predict developer Forest City Ratner Cos. will not only have little trouble renting the building’s 903 high-end apartments but that their arrival on the market will be perfectly timed.

The Beekman opening up is a good thing because there is plenty of demand, says Jack Berman, vice president at Metro Loft Management, the developer of nine luxury rental buildings downtown.

In fact, at this point the supply of eager wannabe residents in lower Manhattan appears to be almost infinite. In recent years, the area has ranked as one of the fastest-growing neighborhoods in the city. Today, an estimated 55,000 people live there. That is more than double the population in 2001 and is up from a mere 14,000 in 1995, according to a recent survey by the Alliance for Downtown New York.

The area has always had more rental buildings than condos, but none quite like the Beekman Tower, brokers say, noting that they expect it to draw residents from all over Manhattan.

There is no other building like it, with views.

That will be unparalleled, says Daniel Hedaya, executive vice president of residential brokerage Platinum Properties. It’s the type of tower people want to live in.

The curvy iron-clad tower is well located, at 8 Spruce St., between William and Nassau streets. It stands just north of the financial district and a stone’s throw from both the Brooklyn Bridge and City Hall Park.

Winning over the locals, to help win over the community, the developer agreed to allocate much of the terra-cotta bottom six stories to a new public school, and roughly 20,000 square feet to New York Downtown Hospital-the tower’s neighbor across the street. The developer will also build a 13,000-square-foot public plaza with trees and a fountain.
While the developer declined to comment on details of the project, leasing is expected to begin in the first quarter of 2011, which could be a lucky break. Because of the financial crisis, which forced most developers to cancel or delay their plans, the only other large rental on the market in the area is Metro Loft’s 20 Exchange Place. It will have 800 units when completed over the course of the next couple of years, including 180 that are expected to hit the market this summer.

Overall, the rental vacancy rate in the financial district dropped 2 percentage points during the first six months of the year from the same period a year ago, according to a recent report by Platinum Properties. The drop was caused in part by a number of longer-term leases that were signed over the past year in response to landlord concessions that included a few months of free rent.

Beekman is fortunate to open in a strengthening rental market, says Gary Jacob, executive vice president of developer Glenwood Management, which raised rents and eliminated concessions in February.

With many of the off-price leases due to expire in the fall, however, the market faces a major test. That factor, combined with a still uneven economic recovery, could yet make Forest City Ratner’s hope of garnering rents that brokers predict will work out to be around $80 per square foot overly ambitious. Rents at nearby Liberty Plaza and 10 Barclay are $60 to $65 per square foot-and even those are considered high. According to Platinum Properties, rents in luxury financial district buildings range from the mid- to high $40s per square foot.

Aiming high, they’re looking to attract the Wall Street crowd and the upper end of the market, says Andrew Barrocas, chief operating officer at brokerage The Real Estate Group. Eighty dollars is extremely aggressive, but I think they have a product that is superior to anything else out there.

Copyright 2010 Crain Communications Inc. All Rights Reserved.

516 West 47th Street
At 703 square feet, this apartment is plenty spacious for a one-bedroom, and the kitchen’s renovated. But in warmer weather, you’ll want to do your entertaining in the 500-square-foot patio, with its ample perennial border.
Broker: Robert Beacham, the Real Estate Group of New York.
$850,000

It was a rough winter for Conan O’Brien, but things are a lot sunnier now. After collecting $32 million in his NBC exit deal, he got a new late show on TBS. His comedy tour has been a sold-out smash. And, oh yeah, he just sold his plush duplex overlooking Central Park.

“Conan O’Brien’s apartment that recently sold had a quirky layout,” says Dolly Lenz, vice chairman of Prudential Douglas Elliman, “But it was the big terrace — the southeast-facing terrace — that sold it.”

That terrace, one of the apartment’s three private terraces, helped sell the apartment at the Majestic co-op building on Central Park West for close to its $29.5 million asking price.

Yes, when it comes to marketing the most high-end real estate in the city, outdoor space can make all the difference.

Lenz recently brokered a deal for an apartment on Central Park West that boasted 4,000 square feet of outdoor space. It sold almost the moment it went on the market for its full $13.9 million asking price. “They bought the interior for the exterior,” says Lenz. “It needed everything — it hasn’t been touched since 1964 — but it was pretty special because of the outdoor space.”

“Any time we are advising sellers who have a terrace, we tell them that spring is ideal,” says Diane Ramirez, president of Halstead Property, which is marketing a 4,400-square-foot Upper East Side duplex penthouse co-op with 5,000 square feet of terrace and an indoor pool for $5.5 million. “In fact, we tell people [who have outdoor space] towards the later winter to wait” and put the property on the market in the spring.

It’s an extremely sensible position, given that private outdoor space is a hot commodity — especially if you want it in a full-service building.

Francois Jeulin, for example, and his broker Cyrine Joaristi of the Real Estate Group of New York, have been searching for a luxury condo with significant outdoor space since April. They saw a 1,700-square-foot two-bedroom loft in TriBeCa with an additional 1,850-square-foot terrace for $2.55 million.

“There were a lot of options [for the terrace],” says Joaristi. “You could cover part of it, you could put in a Jacuzzi; there was a sunroom that [Jeulin] wanted to expand.”

Unfortunately, Jeulin didn’t act quickly enough — as he was getting ready to make an offer, another buyer snatched it up. He’s still on the lookout.

In recent years, developers have spent more time focusing on private outdoor space.

“Developers want to maximize all their assets,” says Brown Harris Stevens broker Wendy Maitland, who is marketing a $12.95 million townhouse on Centre Street that boasts a Tuscan garden and its own domed basketball court on the roof.

“Sometimes you have three or four floors of penthouses” in new buildings, Ramirez says. Why? It allows the developer to add more private terraces.

And while outdoor space is often priced at about 25 percent of the price-per-square-foot of interior space, the right terrace or roof deck can command a huge premium.

“In this hectic city, having a place to go out and have a cup of coffee on, or a place to take your dog, is the extra little special bit,” Ramirez says. “It’s just a jewel factor.”

EVERYONE has heard a nightmare story of a newbie in Manhattan’s crazed rental market: the crooked brokers, the bait-and-switch online advertisements, the cajoling landlords, the thousands of dollars spent — and sometimes lost — in deposits.
 
As the power of the market turns once again to favor landlords and their gatekeepers, the brokers, it is useful to understand what they know that first-time renters may not.

Armed with an understanding of how professionals view the market, as well as some of the tools now available on the Web, renters can decide whether to use a broker, what size apartment they can afford and the neighborhood where they are likeliest to find it.

But even with a thorough understanding of the market, renters may find the apartment hunt daunting because there is no centralized depot for information.

“It is almost like fishing in the dark,” said Danny Hedaya, the executive vice president of Platinum Properties, which specializes in rentals in Manhattan.

During the busy season between Memorial Day and Labor Day, landlords will be testing to see how much they can push prices in a still-uncertain market — getting rid of rebates, ending their payment of broker’s fees and pressing prospective renters to make fast decisions.

Even a reasonably priced one-bedroom, say $2,500 a month, will cost $60,000 over the course of a two-year lease. That’s a lot of money to spend based on a gut reaction.

LIKE A DOORMAN, ONLY... Jordan Cooper is a founder of JumpPost, a new Web site that gives subscribers a heads-up about flats that will soon be available.

What the Pros Know

In early May, Gary L. Malin, the president of CitiHabitats, the largest rental brokerage in New York City, gathered 120 members of his staff in the conference room of the company’s sleek Park Avenue headquarters.

As summer and hordes of renters approached, it was time for a crash course on the latest market conditions.

CitiHabitats, which last year signed leases on 13,000 apartments, has a unique method of tracking what is happening in the market: it monitors rental activity in 25 to 30 buildings, ranging from luxury towers to small walk-ups, in 11 Manhattan neighborhoods.

The “bellwether buildings,” as CitiHabitats calls them, not only provide a snapshot of what landlords are charging, but highlight how quickly apartments are turning over, whether property owners are willing to bargain and other emerging trends.

“I get real-time data, minute by minute,” Mr. Malin said.

Since April, he said, prices have increased by 20 percent in the bellwether buildings. The number of vacant apartments has also fallen, and landlords are starting to stick more firmly to their prices. Mindful of these trends, Mr. Malin’s brokers say that although it made sense six months ago to show an apartment more expensive than the client had budgeted for, landlords are now unwilling to negotiate, so that might be a waste of time.

Other companies use research from both internal and external surveys, all trying to sort supply from demand.

“If you have the information,” Mr. Malin said, “you can demystify the process.”

The most comprehensive overview of the Manhattan rental market is compiled by the Real Estate Group of New York every month and made public on its Web site, tregny.com.

The report breaks Manhattan down by neighborhood, tracking the average rental rates of studio, one- and two-bedroom apartments. It is further broken down by buildings with and without doormen.

The information is based on data pulled from more than 10,000 available listings below 155th Street and with rents under $10,000 a month; ultraluxury properties are omitted, to avoid skewing the numbers, said Andrew Barrocas, the chief executive officer of the Real Estate Group.

Renters looking for one-bedrooms in the East Village, for instance, will find the average rent paid for similarly sized apartments a year ago, as well as more recent month-by-month fluctuations and how those prices compare with costs in other neighborhoods.

The report also shows how much more people pay for the convenience of a doorman: an average East Village one-bedroom with a doorman costs $3,764, versus $2,313 for no doorman.

While some 125 major companies dominate the rental market, the city has thousands of small and midsize landlords. Some work directly with brokers, but others operate independently, generating an untold number of untracked transactions — including sublets, leases directly from owners, and the passing of apartments between friends.

“I call this the shadow market,” Mr. Malin said. “I explain to everyone, even our own people, that there is no company that can tell you 100 percent of the inventory on the market.”

Jacob Camp ran into a scam while apartment-hunting on his own. A broker helped him find his Roosevelt Island home.

To Use a Broker or Not

Given that Manhattan is such a chaotic and fragmented rental market, perhaps it is no surprise that brokers play an outsize role.

Brokers know they are not beloved; they know that some people want to avoid them at all costs. But they also know that in many cases, they are the only game in town.

HEARD IT ON THE GRAPEVINE To stay current, the rental brokerage CitiHabitats tracks transactions in 11 Manhattan neighborhoods in what it calls bellwether buildings, including 666 Greenwich Street.

Some buildings rent apartments only through brokers. Landlords often feel more comfortable with a middleman because brokers generally deliver clients who have been vetted financially and otherwise. For renters short on time, energy and persistence, a broker may be in order.

The longer a renter plans to stay in an apartment, the more sense it makes to use a broker, since the initial investment — usually 15 percent of the first year’s rent — will amortize over time, especially if the deal is good. And for someone completely unfamiliar with Manhattan, a broker can be a good guide.

315 East 21st Street, another bellwether building

Jacob Camp, 21, who moved to New York from North Carolina in May, wanted to apartment-hunt on his own. “My initial impression of brokers was negative,” he said. “Why pay someone for what you can do yourself?”

In his first days of searching on Craigslist, he said, he almost fell victim to a scam: someone tried to get him to wire a deposit for an apartment, sight unseen. Unnerved by the specter of imaginary apartments, Mr. Camp turned to Samantha Brenneman, a broker from Platinum Properties. Through her, he found a studio on Roosevelt Island for $2,000 a month.

In Mr. Camp’s case, the broker’s fee was picked up by the property owner, which is happening less and less these days.

Howard Feingold, the president of Best Apartments, which caters to the budget-conscious under-30 crowd, said landlords were no longer picking up his tab and that, unfortunately, “Clients have gotten used to not paying fees.”

Of course, some people’s instinctual aversion to paying a broker thousands for something that they think they can do on their own will win out. Craigslist and other Web sites are powerful tools, able to leap those tall fees. But they do have downsides, among them information overload.

If you know the neighborhood you want to live in, the best investment may be a decent pair of shoes. There is no substitute for walking around the target area, looking for for-rent signs, and talking with doormen and supers.

Old-fashioned word-of-mouth sometimes works wonders. Odds are that someone knows someone who knows someone who is moving out of an apartment.

New Tools of the Web
In part because the market is so fragmented, an ever-expanding universe of Web sites and iPhone applications are available to the apartment hunter. They promise, among other things, to rid renters of fees, to connect them with honest brokers and to vet listings thoroughly. At their most ambitious, some new sites herald radical changes in how one goes about finding an apartment.

300 East 75th Street is another of CitHabitats’ bellwether buildings

The Web is “the Wild, Wild West,” said Laurence Rosenberg, who left his traditional broker business 15 years ago to start Rent-Direct.com.

Mr. Rosenberg was among the first to see the Web as a chance to provide some of the services of a broker — linking landlords and clients — but without the broker’s fee. At Rent-Direct, landlords list properties; for a fee of $159 to $219, depending on the amount of the monthly rent, potential clients can view the listings for 60 days.

“I was doing real estate in the traditional way,” he said, “and it was unsatisfying for both me and the client. When we had the right apartment, people were paying a hefty brokerage fee. Even though they were happy we had the apartment, the minute they had to write the check they were a bit sour on it.”

Jordan Cooper, a venture capitalist who last year co-founded the Web site JumpPost.com, is convinced that the way people look for an apartment in New York will be transformed in the next few years.

“We viewed the current state of affairs as one where the consumers do not have access to good information,” he said. “The information is controlled by property owners when the apartment becomes vacant and the brokers when they find out from the landlord.”

Exploiting the same model as social-networking Web sites, JumpPost is an early-bird service connecting apartment hunters to people who are planning to move. If the apartment ends up renting through the site, JumpPost pays the outgoing residents $500.

The site has been active for only the last three months, but according to Mr. Cooper, users say they benefit from finding out about available apartments in advance, gaining more time to consider their decision and to plan their move.

It is only at the very end of a transaction, when someone agrees to rent the apartment, that a broker enters the picture to help with the closing. Because the process is not as labor-intensive as a traditional rental, JumpPost charges renters a third of the traditional broker rate — 5 percent of a year’s rent, instead of 15 percent.

“Empowering the consumer is inevitable,” Mr. Cooper said. He is one of a growing number of entrepreneurs trying to slice off a piece of New York’s rental business from the big players.

The site that did more than any other to change the apartment hunt in the city, Craigslist, is still the first stop for many renters — despite complaints that some of the ads are exercises in bait and switch.

Other sites cast a smaller net — sublet.com, for instance. Often, a sublet costs less than a direct rental from the landlord, but comes without the security of a proper lease.

New York City provides a list of tips for apartment hunting on its Web site, nyc.gov. And there are sites that contain mountains of useful data on buildings and neighborhoods, like propertyshark.com. This site is particularly good for finding out about the financial health of a building and whether it has been cited for violations of city code.

Some sites try and match brokers with renters in nontraditional ways.

For instance, nakedapartments.com is the rental equivalent of a dating Web site. Apartment hunters anonymously list the kind of apartment they are seeking and provide their financial information; for a small fee, brokers or landlords can contact them.

So although brokers are still involved in the process, the initial broker-client meeting is a little less of a blind date.

Flatiron
$1.65 million
1200 Broadway
2-bedroom, 2-bathroom, 1,750 sf co-op loft in an elevator building (Gilsey House); unit has renovated kitchen and bathroom and washer/dryer; building has storage; maintenance $2,349 per month; 50 percent tax-deductible; asking price $1.749 million; 12 weeks on the market. (Brokers: Robert Beacham, The Real Estate Group of NY; Toni Haber, Prudential Douglas Elliman)

Greenwich Village
$930,000
30 East 9th Street
2-bedroom, 1-bathroom, 925 sf co-op in a prewar elevator building (the Lafayette); 24-hour doorman; unit has windowed, renovated kitchen and hardwood floors; building has storage and laundry facilities; maintenance $1,255 per month; 49 percent tax-deductible; asking price $965,000; 29 weeks on the market. (Brokers: Jeffrey Wachtenheim, The Real Estate Group of NY; Glenn Schiller, the Corcoran Group)

“[The buyers] sold a one-bedroom condo in the East Village in a walk-up. They wanted to go into a full-service building. The place they sold was noisy and facing the street. The place they bought was bright and quiet and facing the garden.” Glenn Schiller, the Corcoran Group

 In New York, springtime usually means a flood of fresh-faced college graduates ready to start their first job and live together in their first rental apartment.

Last year, much to the dismay of many brokers, that flood was more like a trickle, thanks to the recession. Now, with the economy improving, agents and landlords are expecting the much-hyped return of renters to the market.

“In 2009, there was an eerie lack of the annual stream of recent grads moving to the city for their first job,” said Jeff Schleider, founder of Manhattan-based brokerage Miron Properties. “It’s reassuring to see that these grads are back.”

Buoyed by good news about the real estate market and the economy, landlords and agents gleefully primed themselves for the return of these newly minted renters. Over the last several months, as The Real Deal has reported, many landlords raised their rents and scaled back concessions, such as a month’s free rent. For example, Glenwood — one of the city’s major landlords — spread the word that beginning June 1, it would no longer offer a month of free rent at any of its buildings. (The company will continue to pay brokers’ fees, for the time being at least.)

Jared Wiener, the director of sales and leasing at Platinum Properties, estimated that rents are around 5 percent higher than last year at this time. “This season, the landlords are coming out with guns blazing,” he said.

But they may be getting ahead of themselves. Some rental agents reported last month that despite the buzz, activity has actually been slower than expected so far this season.

“Rental transactions have been steady since April,” said Takeshi “Takk” Yamaguchi, an agent at DJK Residential. “That being said, it’s nowhere near as hectic as I thought it would be.”

While “landlords are taking away incentives in certain neighborhoods and buildings,” he said, “they should not get too carried away in areas like the Upper East Side and Midtown.”

Wiener agreed. “May is slower than anticipated, which is surprising,” he said. “Clearly the job market is not helping.”

That, or renters are reluctant to sign on the dotted line because they’re displeased with the deals they’re finding. “It’s tough when their friends were able to get a similar apartment six months ago for a lower price and a free month’s rent,” Miron’s Schleider said.

Buyers are having a similar experience. Expecting to find a slow market where they’ll have their pick of deeply discounted apartments, they’re surprised to find intense competition instead.

“Buyers can’t believe that there are multiple offers and bidding wars happening so regularly, until they experience it firsthand,” said Ari LeFauve, a vice president and associate broker at the Real Estate Group New York.

The competition is being fueled by a continued shortage of well-priced inventory, brokers said, as well as a large number of bargain-hunting buyers all reentering the market at the same time.

“Buyers are coming out of the woodwork,” said Ali Jafri, an agent at Prudential Douglas Elliman. “There is a release of pent-up demand.”

As a result, “everyone is going after the same listings,” said Rob Jackson, a salesperson at the Corcoran Group.

The competition also intensified this spring thanks to the end of the federal homebuyer tax credit program on April 30, and those buyers are now racing to make sure their deals close before the deadline of June 30.

“The government stimulus tax break definitely gave even more urgency for buyers,” said Fumiyo Hayashi, a vice president at Barak Realty. “What’s difficult right now is the pressure of making sure that things are moving so that the buyers can close by the end of June to capture the tax break.”

In general, buyers who don’t make offers quickly enough are finding that, often to their great displeasure, they are getting outbid on the properties they want — sometimes multiple times.

Others can’t find homes at all, which can be frustrating.

“In the large-apartment segment, meaning eight to 12 rooms, there is simply no inventory,” said Deborah Komarow, an agent at Warburg Realty Partnership, noting that few of these large homes have come on the market recently because sellers want to avoid discounting them. “Now that the market has stabilized, the large-apartment buyer has come back into the market, and there is nothing to show them.”

Some buyers simply aren’t able to accept that the crisis may be over, said Judi Desiderio, the CEO of Hamptons-based Town & Country Real Estate.

“You have the half-empty/half-full mentalities,” she said. “Some are playing it like Chicken Little, ‘The sky is falling,’ and expect a double-dip recession with housing taking another tumble. Others — and this is the majority — believe we have bottomed out and are ready to buy.”

One lingering concern for many is the economic turmoil in Europe.

“The Euro zone crisis may still yet spill over into the global markets, which in turn will hit New York real estate values, and this is of serious concern,” said Schleider.

Still, conditions are markedly improved for brokers.

As John Reinhardt, president and CEO of Fillmore Real Estate, said, “It’s great to be busy again.”

“If we’re taking vacations, we’re not staying away too long,” he said. “This is the right environment for a salesperson.”

 
David Behin, a part-owner of new development marketing firm the Developers Group, was understandably concerned when the real estate market crashed two years ago.

With condo sales stalled and few new projects getting built, he was suddenly nervous about the future of the seven-year-old company, not to mention supporting his family.

“I had to figure out where to get new projects from,” Behin recalled.

He started cold-calling bankers and investors and taking them out to lunch, offering to do market research for free, hoping to network and learn which distressed properties were coming on the market. Now it’s finally paying off: In addition to selling new condos, Behin also acts as a consultant for workouts on troubled new developments. That translates into more exclusive sales contracts for his firm once the properties are turned around.

“I’m not a workout specialist, but I can make workouts happen because I can bring the parties together,” said Behin, who has been working on these deals independently, but soon plans to form a team within the Developers Group (which recently merged with another brokerage, the Real Estate Group New York).

As the number of condo projects coming to market has slowed to a trickle, new development marketing firms are facing an identity crisis. Some have virtually disappeared, while others have dramatically altered their business models — and rebranded themselves accordingly — to stay afloat.

Firms like aptsandlofts.com and Core, which until now were known primarily as new development firms, are focusing on resales more. Other new development marketing players, like Behin and the Marketing Directors’ Andy Gerringer, are consulting on workouts at troubled condos.

“New development in New York City has changed completely,” said David Maundrell, the president of aptsandlofts.com. “I’m going to be a different company in two to three years.”

In the early 2000s, a group of boutique firms sprang up to take advantage of the condo fever sweeping across the city. Meanwhile, major firms like Halstead, Prudential Douglas Elliman and others grew their new development divisions.

But the credit crunch has forced them to rethink their approach.

Kelly Kennedy Mack, president of Corcoran Sunshine, said in the fourth quarter of 2009, not a single new development condo opened in Manhattan. Only two projects — Griffin Court Condominium in Hell’s Kitchen and the reconceived Sheffield — launched sales in the first quarter of 2010, she noted.

“[Now] there’s an oversupply of firms that specialize in new developments,” said Jonathan Miller, an appraiser and a limited partner at Condominium Recovery, which converts distressed new condo projects to rentals. “They were built around a market that had projects coming on every day. Some of these firms will adapt, and some won’t.”

Some companies have already faded into the background.

As The Real Deal has reported, the Shvo Group — once one of the city’s most prominent firms — has largely disappeared from the public eye, though it is still marketing one project, 20 Pine.

Others have refused to go gentle into that good night, even if it means changing business models.

Behin, for example, has been working on deals that are far from a residential broker’s usual purview. He recently worked with a stalled Queens project where the developer ran out of money and the bank refused to lend any more. Behin found a new investor, allowing construction to finish.

But it hasn’t been easy to change the perception of the Developers Group as merely a residential brokerage. While Behin already had connections with developers, he said, he had to network aggressively with banks to find out about distressed assets coming on the market.

Moreover, there’s often a delayed payout: Behin sometimes receives a consulting fee or a commission, but often his compensation is receiving the exclusive marketing contract for projects when they start selling again.

“You do a lot of work for free right now, hoping they’ll remember you when times get good,” said Gerringer. A new development veteran who made his name selling bank-owned condos in the early 1990s, Gerringer has been meeting with private equity firms and other investors looking to turn around distressed residential properties. “I’m trying to be kind of a fixer or middleman to put deals together, with the hope we’re going to be the broker,” Gerringer said.

Both sources noted that these types of deals are just starting to occur, as banks finally stop “extend and pretend” policies for troubled loans.

Warehouse 11, a stalled 120-unit project in Williamsburg, is a good example. Sales there recently started again after the developer, McCarren Park Mews, reached an agreement with Capital One Bank and a third-party financier to buy back the building’s debt.

Aptsandlofts.com, the exclusive marketing and sales agent for the project, was not involved in the agreement, but the firm did market research to help the developer reprice the units, Maundrell said.

He said he isn’t getting involved in workouts the way Behin and Gerringer are, but has changed his business model by “focusing a lot more on resales.”

The shift started when the city’s 421-a tax abatement program expired in 2008, and Maundrell foresaw a resulting slowdown in new development projects.

The brokerage already did a substantial number of rentals, but Maundrell hired agent Jennifer Lee and tasked her with running a new resale division, which now has five people.

He’s also been “encouraging agents to follow up with people they’ve sold to,” so that the company can resell condos when the original buyers are ready to move again, he said.

Another company that’s undergone a recent image overhaul is the boutique brokerage Core. Founded in the early 2000s by erstwhile Elliman wunderkind Shaun Osher, the company quickly gained recognition for its new development marketing in the white-hot condo market. Most people didn’t realize the company also did rentals and resales.

“We’ve been doing resales since day one,” Osher said. “It just so happened that when the new development market was hot and heavy, we were one of the leaders, so people perceived us as a new development company.”

That’s a perception Osher has been working to dispel. He changed the company’s name in 2009 from Core Group Marketing to simply Core. And he’s made an effort to hire brokers who specialize in resales, like Mercedes/Berk alum Christian Rogers and Ogden Starr, a 27-year co-op specialist who joined Core last month. As a result, about half of the company’s deals are now resales, Osher said.

Perhaps the most effective way of changing the company’s image has been the HGTV reality show “Selling New York,” which features Core brokers interacting with homeowners whose apartments they’re trying to sell. “It’s definitely helping the brand recognition,” Osher said.

That certainly seems to be the case: Starr said his first client at Core was a Maine resident who called the firm after watching the show, asking for help selling his home there.

Osher said the company is now mistaken for a new development firm “a lot less” than it was two years ago.

By Candace Taylor

Apartments at 302 Columbus Avenue, the old J.M. Horton Ice Cream Company building

Throughout the city, rents have been rising gradually, and fewer apartments are sitting empty. But the Upper West Side rental market is a mixed picture, according to a rental market report released today by The Real Estate Group of New York (TREGNY).

In fact, two bedrooms in buildings without doormen continue to fall in price, and are now at their lowest level since TREGNY started tracking rents in 2007. The average non-doorman two-bedroom in the neighborhood rented for $2,896 in May. A year ago the average rent was $3,367.

Prices for other classes of apartments were mixed. Non-doorman studios (+2.97%), non-doorman one-bedrooms (+0.44%), and doorman two-bedrooms (+2.88%) all rose; Doorman studios (-1.65%), doorman one-bedrooms (-1.01%), and non-doorman two-bedrooms (-0.36%) all fell. Check out the full report here.

Average Prices
Doorman buildings
Studio: $2,094
One bedroom: $3,228
Two bedroom: $5,445

Non-doorman buildings
Studio: $1,732
One bedroom: $2,290
Two bedroom: $2,896

 The picture is changing but rental deals are still out there

The buzz among rental brokers and developers is that after two years of shaky rents, the market is finally recovering. Rents are rising! Activity is up!

In fact, there are plenty of Manhattan buildings renting at a much faster clip.

Scott Walsh, director of market research at TF Cornerstone, points to the leasing of 2 Gold’s second tower, which started in March 2009, compared to the leasing of 505 W. 37th St., which began at around the same time this year. Where 2 Gold had averaged 10 deals a week in the beginning, rising to 20 or 30 as the summer progressed, at 505 W. 37th St. they’re already doing 30 deals a week — and only expect activity to increase as the rental season continues.

CORNER LOT: At the Corner, renters can get one month rent-free when signing a new lease, like Siobhan Guerin (above) recently did.

“At the rate we’re going, we should have [505 W. 37th St. fully] leased by the fall,” Walsh says. (The building has nearly 300 units, about 50 percent more than 2 Gold’s 189.)

As for rents, according to the Real Estate Group New York’s latest Manhattan Rental Market Report, April rents were up 1.1 percent over March, and 0.27 percent over 2009. Negligible, yes, but up nonetheless.

“Prices have come up in two ways,” explains Gary Jacob, executive vice president of Glenwood, which is currently leasing Emerald Green at 320 W. 38th St., and plans to start construction on the 200-unit rental Crystal Green on 39th Street in the fall.

“One way is, last year we were giving one month’s free rent on every building . . . but starting in February, we stopped giving concessions at any of our buildings,” says Jacob. “The other aspect is in absolute dollars. The rents are inching up as well — about another 5 percent.

“Since concessions are being dropped,” he adds, “the next sign [of recovery] would be that landlords stop paying the brokers’ fees.”

So, do we take all this to mean that the brief, shining moment when the scales were tipped in the renter’s favor is over? Not exactly.

Yes, rents might be edging up, and landlords are seeing faster lease-ups than last year, but we’re nowhere near pre-bust levels of activity.

“In the past you could write it down, May 1st, the switch was flipped and the floodgates [for renters] opened,” says Marc Lewis, president and CEO of Century 21 NY Metro. That’s because spring is graduation time, when new hires come to the city, traditionally kicking off the busiest time of the year for renting.

“Most of these [rental buildings] have been doing this for a long time, and they know it should be busier right now,” Lewis says.

And while Glenwood has taken concessions off the table, right now the company is the exception. Ask most rental development firms with new buildings on the market whether they are still giving incentives, and the answer is likely a sheepish yes.

For example, the Corner, a new development from the Gotham Organization at 200 W. 72nd St. on the Upper West Side, is giving one month free rent on a 14-month lease. And Douglaston Development’s Ohm, in Chelsea, and 505 W. 37th St. are both giving two months free on 14- month leases.

“In a new-construction property, the owners would love to do no free rent,” says Walsh, explaining that TF Cornerstone is not giving incentives on any properties that have already been leased in full, and is even doing some preleasing (meaning they’re not waiting for apartments to be vacated in order to lease them).
“We were giving one free month [at 505 W. 37th St.] and we weren’t seeing the traffic levels,” says Walsh. “All the buildings around us are offering two free months, so to be competitive, we’re offering two free months.”

Studios in the building, located just west of 10th Avenue, are going for $1,950 to $2,200 net effective, one-bedrooms are starting at $2,700, and two-bedrooms at $3,800.

Adding to the peer pressure landlords are already feeling from competing buildings, renters’ expectations are still high — they still feel that they should be getting a deal.

“It would have been a more difficult choice without the one month free; it was a huge selling point,” says Siobhan Guerin about the decision to sign a 12-month lease on a studio in the Corner, where her rent is $2,480.

“It made it more reasonable and fit in my budget,” Guerin says. “We’re in hard economic times — it’s getting better, but as a renter I still want a bit of a deal.”

That said, while renters might win in the short run, in the long run, landlords will likely attain the rents they want.

“I think where you still see [free rent] is to renters in new buildings,” says Andrew Barrocas, COO at the Real Estate Group New York. “[New buildings] want rents as high as possible.”

Which means that a renter might get one or two months free rent, making their net effective rent quite low, but come lease-renewal time, not only will there be no free rent, but the rent will likely go up. And in these luxury buildings, we’re talking about higher rents to begin with.

While it’s the new buildings that are offering rent concessions, landlord-paid broker fees are still present across the board, in all kinds of rentals, both new and old.

That’s what allowed Molly Budds and John Tsipouras to trade in their Upper East Side one-bedroom walk-up for a one-bedroom, literally around the corner in an elevator building, at a negligible cost.

Though their rent increased to $2,150 a month from $1,700, they gained counter space, more character all around and a bathroom that is accessible from the living room and not just through the bedroom. All this and they didn’t pay a broker fee.

Other types of incentives are still on the table, as well.

To attract rental tenants, Douglaston Development offers its residents $500 for referrals. Since leasing began in February at Ohm, 8 percent of the 80 signed leases came though referrals — and referrals have accounted for 10 percent of the traffic. The building’s 288 units include studios priced starting at $2,014 net effective, one-bedrooms at $2,357 and two-bedrooms at $3,214.

As long as vacancies remain high (according to TREGNY they are up 1.17 percent across the city), concessions will likely continue.

“There is a tremendous inventory,” says Lewis. “There are a number of new projects out there, and landlords are still giving away incentives to rent there; it’s not a time to be increasing rents.”

 For all the flack it gets, Williamsburg is still a hot place to live — at the right price. But even developers and brokers, perennial optimists even during real estate’s darkest hours, seemed a bit surprised by a recent spike in activity at some new buildings.

Northside Piers, the 450-unit waterfront project that has consistently been a top seller citywide since broadcasting aggressive price cuts early last year, just logged its best month since opening during the boom year of 2007, said Scott Avram, senior project manager for Northside Piers developer Toll Brothers City Living.

Forty contracts were signed in the past four weeks. Avram wondered “if everyone was having the same experience.”

So, The Real Deal made some calls around the neighborhood. While nobody quite scored 40 buyers in one month, it does seem like sales and leasing activity has been strong at projects with some combination of the following three winning characteristics: “location, price and the finishes,” as broker Christine Blackburn of Prudential Douglas Elliman put it.

Indeed, the projects that have been popular are all in tight proximity to Williamsburg’s stylishly retailed Bedford Avenue or right on the waterfront. And none have tried to pass off “hollow doors and cheap wood flooring” or “traditional” color palettes as luxury, like other struggling developers in the neighborhood, said Blackburn, whose team has sold or leased dozens of apartments in Northside Piers, 184 Kent and 70 Berry among others.

Warehouse 11 sold around 90 of its 120 apartments since January; the waterfront loft conversion 184 Kent leased 138 apartments in four months, including 38 in the last three weeks; and 70 Berry Street sold all of its 38 apartments in less than five months, according to various real estate sources.

Now even the Edge — the 565-unit waterfront project by Douglaston Development that has withered, sales-wise, in the shadow of its significantly less expensive neighbor, Northside Piers — seems to be catching a break.

Eighteen contracts were signed in April, said Highlyann Krasnow, a partner at brokerage the Developers Group, which is marketing the project.

Krasnow wouldn’t say what percentage of the overall development is spoken for, but she added that two of the sales last month were $2.2 million penthouses, and six were in excess of $1,100 per square foot.

“On Friday, we sold seven units in one day, and today we’ve had three offers,” Krasnow said yesterday.

Nearby, 66 North 1st Street, a 21-unit factory loft conversion by architect Robert Scarano, is nearly half sold.

“We’ve had five accepted offers last week,” said Michael Brooks, senior vice president of the Developers Group. “I don’t know how to explain it. We just caught fire!”

He said deals are being made at $650 per square foot, which Blackburn agreed seems to be Williamsburg buyers’ sweetspot for non-waterfront apartments. (Warehouse 11 is one main exception — most of the apartments sold at around $580 per square foot, said a spokesperson).

(Note: correction appended).

“Other buildings in Williamsburg that have been actively selling are 125 North 10th Street with 19 closings this year, 80 Metropolitan Avenue with 10 closings, and 14 Hope Street with seven closings,” said Sofia Song, vice president of research at Streeteasy.

Avram’s theory on the uptick in activity is that buyers are starting to sense the real estate market may have hit bottom, and want to lock in offers before prices go back up again.

“I think a lot of people have been waiting a long time to buy, and they’re starting to see the incentives developers have been offering are in decline… [Developers] are being a lot more stingy with their negotiating,” Avram said. “The boat is starting to sail.”

Even the notoriously wide price gap between his project and its main competitor, the Edge, has just narrowed by $90 per square foot, according to Streeteasy.com.

Northside Piers’ average listing price jumped from $785 to $875 per square foot, now that nearly all of its discounted apartments have been snapped up, versus the Edge’s $926 per square foot.

THE government program that allows qualified people to buy homes with very little money down is gaining traction in New York.

The loans, offered through the Federal Housing Administration and available since 1934, provided 1 percent of the home loans in the region in 2007, but the number jumped to around 18 percent in 2009.

As credit tightened, developers also got on board when they realized their new apartments weren’t selling.

“When we started the process, nobody was familiar with F.H.A.,” said David Behin, an executive vice president of the Developers Group, whose recent projects include the Edge condominiums in Williamsburg, Brooklyn. “And to be frank, I wasn’t that familiar with it either. But we had problems with our buyers’ being able to get loans. The world was in flux, and new development faced its own special set of problems.”

Mortgage brokers, he said, suggested the F.H.A.

The agency does not actually make loans but insures them. The mortgages can then be given to people with scant credit history — like young first-time buyers — or even tarnished credit, and the down payments can be as low as 3.5 percent. The F.H.A. vets buyers to determine whether they’ll be able to pay the loan back.

“F.H.A. has stuck to the basics through the years,” said Vicki Bott, a deputy assistant secretary at the Department of Housing and Urban Development. “We always documented income, we always evaluated credit. We want to be sure that the underserved market can still obtain a home, as long as they can make the payments.”

According to Ms. Bott, the F.H.A’s goals are threefold: to serve underserved markets, to give the housing market a boost when loans are hard to come by, and to protect itself to make sure it can keep doing business.

In the national market, “F.H.A. has always played a countercyclical role,” Ms. Bott said. According to HUD data, the percentage of F.H.A. loans in the mortgage market fell to just below 5 percent in 2005 and 2006. “Now it’s grown to 30-plus percent as capital has withdrawn from the market,” Ms. Bott said.

To qualify for an F.H.A. loan, the home as well as the buyer must be approved. If the home is in a condominium building, the entire structure must be submitted as a whole. (The F.H.A. does not insure loans made in co-op buildings.)

During the credit boom, developers did not often see the need to submit to the application process — and even now, condo boards can be tough to convince.

Another quirk that helped minimize F.H.A’s presence in the New York City market was price. Until 2008, the maximum loan amount for F.H.A. financing was $362,790, far lower than the price of most apartments.

But two years ago, as the government tried to prop up the sputtering housing market, the limit in expensive areas like New York shot up to $729,750.

Suddenly, apartments in buildings with lap pools and gyms could qualify. Trendy complexes like the Toren in downtown Brooklyn and the Edge in Williamsburg started publicizing their F.H.A.-approved status. And companies like National Condo Advisors have sprung up to help developers and boards navigate the paperwork.

And as the loans have become more prevalent, the stigma that once trailed the F.H.A. has begun to melt away.

“I think some buyers might have thought it was only for people who couldn’t obtain regular financing when credit was easier,” said Stephen G. Kliegerman, the executive director of development marketing at Halstead Property. “But that’s really not the truth. It’s an alternative for anyone who wants a lower cash-down alternative.”

Meanwhile, as the F.H.A has taken on a bigger role in the mortgage industry, it has seen its default rate rise and its reserve fall below levels mandated by Congress. And its responsibilities are about to increase. Later this year, some homeowners whose houses are worth less than their mortgages can begin the process of refinancing through F.H.A. loans as part of the Obama administration’s effort to deal with the foreclosure crisis.

Some on Capitol Hill have expressed concern. Last year, Representative Scott Garrett, a New Jersey Republican, introduced legislation that would have raised the minimum F.H.A. down payment to 5 percent. H.U.D. itself has decided to raise the down payment to 10 percent for buyers with credit scores below 580.

But according to Ms. Bott, the F.H.A.’s presence in the market is so pronounced that any pullback could hurt housing as a whole.

“F.H.A. is in a tough place,” said Ingrid Gould Ellen, co-director of the New York University Furman Center for Real Estate and Urban Policy. “Its role is to provide credit to the market at times when private lenders withdraw because they see it as too risky. On the one hand, we get upset if it isn’t lending enough, but by definition they’re coming in at risky times. It’s a little bit of a Catch-22.”