Issue 52 – The Soho Vortex

Say what you want about the deep freeze of winter, not even plunging temperatures can compete with what is happening in the streets south of Houston Street. While the 2013 median price of a New York City home remained relatively stable at $825K with a yearly increase of less than 1% from 2012, prices in SoHo jumped an astonishing 31% to $2.62 million. No longer does TriBeCa hold the title of Manhattan’s most expensive neighborhood. That distinction now belongs exclusively to SoHo, and judging by what’s in store for new luxury developments, commercial leases and inventory-starved affluent buyers, this is just the beginning.

News of SoHo’s succession to the top of the city’s most uber-luxury neighborhoods comes on the heels of a recent sale of eight parcels of land totaling 280,000 square feet of development space bordered by Watt, Varick and Broome Streets. Slated to be the largest ground-up project in SoHo, the site allows for a 290-foot tower commanding views of the Hudson River and the Empire State Building. In SoHo and throughout the city, concerns for the impact of the new mayor’s policies on zoning, construction and affordable housing requirements which first made developers sweat are now easing with the realization that the new administration’s changes to Bloomberg-era sweetheart deals will be incremental and modest, if not status quo, in the foreseeable future. For what has already broken ground, the impact will be negligible.

What cannot be measured in metrics and sales figures is the enduring appeal of one of Manhattan’s oldest and most creatively-infused corridors, one that continues to attract international artists and celebrities. Tabloids are rife with stories of Taylor Swift’s recent townhouse shopping excursion and Jon Bon Jovi’s Mercer Street penthouse listing. However, the artistic legacy of SoHo is not without modern-day controversy as many lofts here remain legally reserved for artists. Back in the early 1970’s when the state sought to preserve abandoned and run-down manufacturing spaces as an enclave for painters, sculptors and those in the performing arts, the city gave amnesty to maintain the creative integrity of the neighborhood. Regulations for what exactly defines an artist became more rigid in 1986, and the pool of applicants to the Department of Cultural Affairs for status certification has continued to shrink year after year with spaces become fewer and more expensive; in 2013, only 14 individuals applied for the designation. True, SoHo exemplifies what many consider to be a mass exodus in the creative field to outer boroughs from a rapidly decreasing supply of affordable living and working space.

Take a walk down West Broadway, and the intense demand for SoHo space becomes even more patent. Recent building purchases, retail leases and condo developments born out of the economic recovery have only served to heighten the frenzy factor. Restaurants and gallery spaces are making way for high-end retail, with Greene Street commercial rents tripling in just the past three years. Little surprise when apartments are selling in the double-digit million dollar stratosphere, the luxury brands that complement the lifestyle quickly and increasingly make their home in the neighborhood.

Across the city, deals that shattered records in the past year such as One57, 432 Park Avenue and Walker Tower have yet to close, but they will do little to affect the concentration of demand, prestige and cache that SoHo has earned. Downtown is sizzling, and the New Year has just begun.