(Google Maps)
Despite record-setting rents throughout the city, the developers behind a high-end Upper West Side rental building with abundant amenities and eye-popping prices are at risk of defaulting on their loan, citing the pandemic as the primary reason behind their financial woes.
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The Aire – a 43-story tower at 200 West 67th Street on Amsterdam Avenue – comes with a slew of amenities including rehearsal rooms, indoor and outdoor children’s play areas, a private party and event deck and more.
Per the building’s website, currently available units range from $3,700 (for a studio) to $12,400 (for a 3 bedroom, 2.5 bath).
The original loan was for $250 million, and according to Commercial Observer, developers A&R Kalimian Realty have $195.8 million to go.
The publication also states that while the building “saw occupancy drop to 70 percent from 97 percent in 2020,” it more recently rebounded back to 97%. (There are 310 apartments in the building.)
Back in 2017, the loan was put on the lender’s watchlist due to concerns about its ability to generate enough income to cover the loan payments, Bisnow reports. This happened after a 10-year tax abatement for the building expired, leading to a 20% increase in taxes every two years since 2014.
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In April, the developers “indicated the residential rental market in New York has been decimated in relation to COVID-19, thus, they are offering rent reductions and free rent to retain tenants and rent vacancies.” According to CRED iQ Senior Managing Director Marc McDevitt, the pandemic certainly affected the property, but there were already cash flow issues prior to the outbreak.
It’s hard to say what kind of wiggle room you’ll see on a five-figure monthly rent, but now is probably a good time to find out.
That they can’t pay their bills at 97% occupancy means they made bad decisions.
Hard to sympathize.
my 92 year old neighbor loved to walk thru there when taking a shortcut to get to AMC theatre.
And no doubt they will want help from the City. Imagine a 10 year tax abatement! As usual the taxpayers will be stuck with the mess. But no worries the developers have made their money and moved on.
Sad
Perhaps they should consider some sort of systematic conversion of available units to a condo or co-op arrangements?
Clearly those in power to do so did not keep their ear to the ground in their eyes on the horizon
Deal with jacko’s
Maybe that partially explains or indicates an issue with the building as the scaffolding that has surrounded it for much more than one year is still in place. The entrance off of Amsterdam is so dismal, full of litter, and everything else that come when scaffolding stays in place for that long. If I were looking for a high end apartment to rent and saw that mess I wouldn’t even bother going in.
Poor management, filthy garbage disposal rooms, and cheap materials used in construction.
The owner / “developer” is wealthy, entitled, inept and lazy. If the Titan submarine were a building on the UWS, it would be the Aire.
I’m sure they can pull themselves up by their bootstraps.
The residential rental market was definitely not decimated in regards to Covid 19. Maybe for a year or so, but now it’s tighter than ever.
Does someone know why the retail space which is now Polestar was left empty for so many years? They could have had income from that. Also you hardly ever see customers in Polestar. Any answers would be appreciated.
From what I have heard, the owners are (at best) inexperienced and (at worst) scumbags. When flywheel was in the retail space, management would inexplicably turn off the the heat in the winter and the AC in the summer. Word gets around.
I suspect this type of treatment extends to residential tenants as well and explains why they are failing. Hopefully someone with more experience will take it over.