It is no secret that New York City is facing both unprecedented highs in apartment rental rates while condominium prices drive the sales market to unforeseen heights. However, there is now competition between the two spectrums of the market as they are becoming one of the same tier.
Last week the New York Post ran an article regarding the growing trend of rental-to-condo building conversions, which is coming as a result of a lack of available land to build from the ground up. The trend sees condos at a higher demand than the older rental buildings currently in place, resulting in a profitable choice for developers to convert.
However, many developers are eyeing a different trend in the new rental-condo market. As featured in the New York Observer, as a result of the skyrocketing condo prices and many New Yorkers unable to buy, there is a new demand for luxury rentals. The consumer of condos and high-end rentals demand the same product in terms of amenities, finishes, size, etc., and now developers are building rentals that cater to their demand and rival their luxury condo predecessors.
For example, SHoP Architect's new rental towers at 626 First Ave will boast building-wide use indoor and outdoor infinity pools, while the Soori High Line condominium will offer residents private indoor or rooftop pools. Even this one amenity thought to be a highlight of top-tier condominiums is rivaled in the new rental developments.
Even outside of the new rentals, the demand is still being met -- condo owners are creating their own luxury rental market. With increased motivation to invest in New York real estate, purchasers of pied-a-terres are left with vacant units and are renting them out until "it's time to cash out," according to The Observer. Those eyeing the luxury rental market are in luck as there is nothing more close in resemblance to the original sought after product than renting in a condominium.