Jeff Levine: 'Cockeyed Optimist'
The Times ran an interview with Jeff Levine this weekend in which the developer of Williamsburg’s Edge, a self-described “cockeyed optimist,” talks about the present market’s challenges. Levine says lack of financing is the biggest barrier to recovery these days but that he thinks New York, last to the downturn party, will also make one…
The Times ran an interview with Jeff Levine this weekend in which the developer of Williamsburg’s Edge, a self-described “cockeyed optimist,” talks about the present market’s challenges. Levine says lack of financing is the biggest barrier to recovery these days but that he thinks New York, last to the downturn party, will also make one of the quickest exits. More interesting: Levine says Phase 2 of the Edge is unlikely to be on the drawing board anytime soon because of lack of financing, and sales at Phase 1 of the development while marked by high points like the sale of a $5.25 million penthouse are basically stalled at the 20 percent mark. Nevertheless, unlike neighboring Northside Piers, he’s not dropping prices at the project: “We have not reduced prices at all. Obviously, if we have a willing partner who wants to buy a unit, we will work with them to facilitate their purchase whether that means we help with their closing costs or help them with their parking requirements.”
The 30-Minute Interview: Jeffrey E. Levine [NY Times]
Photo from The Real Deal.
bjw – Yes, you want as many people as possible to know about price cuts. Price cuts increase interest and foot traffic. You should make a big a deal as possible out of them. You get no benefit from a quiet little cut that gets no attention and dies on the vine. Why would this somehow be wishful thinking on my part? That comment doesn’t make any sense.
you all sound like miss muffett alter egos deparately talking down the market.
just be patient, i’m sure you’ll eventually get to move into your dream apt at 50% off.
at least he puts his money where his mouth is dittohead.
you. not so much.
“So you are completely wrong on all fronts. He should announce now, and he absolutely should announce in an interview with the NYT.”
Chill out. I’m not saying his strategy will certainly pay off in the end – frankly, neither you nor I have any idea. It’s very clear that they’re waiting out this economy as long as possible. Construction still has a ways to go, and recognizing that people just don’t buy sight-unseen anymore, they feel much less pressure to pre-sell. They’ll sit tight until the building’s in move-in condition, and then if the market’s still as bad (and my bet is yes, though Levine’s seems to be that it’ll be less bad at least), THEN they make the move. That’s when their competition for sales really starts. For all the hubbub about Northside Piers making significant cuts in pricing, all of it was done in the first tower. Notice that their strategy on the obviously pricier second tower is exactly the same as the Edge’s.
“You want every last reader of the NYT real estate section to know about your price cuts.”
Really? You don’t think you’re just projecting a little wishful thinking here? Come on.
antidope: don’t use big German words unless you know what they mean. People here are telling him he’s a dingbat, a fiddling Nero. Nextdoor at Northside they are paying buyer’s mortgage for a whole YEAR, and this guy, having 80% unsold, is saying no price cuts at all. The Edge is a step up from Northside Towers, but the difference isn’t much.
antidope, who said I have schadenfreude? I am pointing out some stupid tactical decisions. I have absolutely no reason to take pleasure in the position a lot of developers find themselves in.
“In all likelihood, they will lower their prices, but anyone expecting him to announce that now, before construction is even done, and in an interview with the NYT obviously has very limited understanding of how development and sales actually work.”
I’m all ears. Tell us, why would a developer keep a price tag that he knows to be unrealistic and over market for one second more than he has to? When the competition is dropping their prices – and attracting away your potential buyers – what is the wisdom in waiting until you reach some kind of construction milestone before reacting? Is the goal to make sure as few units as possible go into contract before construction is finished?
And as long as you are going to lower prices, you damn well want that information to be given to as big an audience as possible. You should sit down with the NYT and say “damn right we’re lowering prices! It’s like a logging job with all the chopping that’s going on!” You want every last reader of the NYT real estate section to know about your price cuts.
In fact, by doing just the opposite – saying in such a public forum that he is NOT dropping prices – he did some real damage to his marketing efforts. Everyone is cutting prices, because the market sucks, there is a ton of inventory, and they have to. It is now a built in expectation that must be met as a prerequisite to getting deals done.
So you are completely wrong on all fronts. He should announce now, and he absolutely should announce in an interview with the NYT.
wishful thinking can only help to a certain point and miracles need devine intervention
In all likelihood, they will lower their prices, but anyone expecting him to announce that now, before construction is even done, and in an interview with the NYT obviously has very limited understanding of how development and sales actually work. Most of these comments are pretty ridiculous.