Weekly News (March 13, 2019)
Ridgefield moves forward to move on new municipal hall
- Current municipal building is getting old and requires serious repairs due to aging. The borough council approved to issue $850,000 bonds for initial environmental studies, engineering and design work. The new site will be on Slocum Ave next to Borough Community Center and across from Ridgefield Nature Center.
- Municipal court, police department, building department and borough offices will move to new building eventually.
Northern NJ, number of students are increased sharply
- Towns in Northern New Jersey step forward to prepare budgets for increasing school facilities due to sharply increased number of students. Number of students in Edgewater is increased by 56% in last 10 years due to the fast residential development along the River Road which is the only major road through the town, even though about 1000 residents moved out by the Avalon complex fire incident in 2015.
- Currently 1857 luxury condo and 60,000 sf commercial development is planned at former Hesse oil tank site, which will make the situation much worse.
- In Edgewater, George Washington school has K – 2nd grade, Eleanor Van Gelder school has 3rd – 6th grade. 7th – 12th grade students go to Leonia High. The current 980 students will be 1100 in 2 years.
- In other towns such as Englewood Cliffs, South Hackensack, Fairview, Little Ferry, the number of students were increased by at least 20% for last 10 years.
Tax benefit given for Hudson Yard project was much bigger than Amazon HQ2
- NYC provided the developers (related Compass, Oxford Properties Group) much more than just tax benefit such as direct investment of extension 7 Subway to Hudson Yard ($2.4B) and setting up the park ($1.2B). Total benefit provided to the project would be about $6B which is much more than proposed benefit($3B) for Amazon HQ2.
- In order to provide this benefit, NYC had to issue the bonds which incurred interests payment of $359M.
- Not only developers, but also big tenants received tax benefits: Asset Management company BlackRock received $25M tax exemption, Loreal USA received $5.5M, and Warner Media received $14M.
- Hudson Yard opens on 3/15/2019 with 13 buildings which will bring total of about 55,000 jobs, and about 20 high quality restaurants, café, super size performance center, etc which takes more than $1M sf. It is biggest development project by private companies in US.
Hudson Yard started pre-sale for 92 story Luxury condo
- “35 Hudson Yards” co-developed by Related Partners is not a condo building, it is a life style said the company’s chairman Stephen Ross, which will start pre-sale in the middle of this month, and will complete the construction this fall. 1 – 38 story will be office and hotel, 39 – 72 story will be condo for 2 – 6 bedrooms, which are mostly 3 bedrooms.
- The price for condo starts from $5M (2br: 1,492 sf) and average unit price is $11M which is $4,100/sf. (total 143 units)
- Sales and marketing by Related Sales LLC and Corcoran Sunshine Marketing Group
- According to Elliman, average condo unit price in Manhattan is $3,100/sf.
- Currently about 60% sold and mostly New Yorkers (70%) purchased them.
- Architectural sculpture “Vessel”(154 ft) can hold 1000 visitors at the same time. (www.hudsonyardsnewyork.com/discover/staircase)
Chrysler Building in Manhattan, NY sold at $150M
- Chrysler Building located at 405 Lexington Ave, NY was purchased at $800M in 2008 by UAE ADIC (Abu Dhabi) who has 90% share, is sold at $150M to RFR Holdings. This building was built in 1930 and it needs significant repairs, and also ground lease rent is sky-rocketing from $7.75M to $32.5M per year. Consequently building price went down tremendously.
- This one of most beloved architectural landmarks was listed early this year by CBRE.
- Total rental space is more than 1.2M sf.
Fed Reserve Chair Powell does not feel need for Ref IR increase
- Right after ECB (Europe Central Bank) announced to keep zero(0) IR till the end of this year, Powell mentioned that he does not feel the need for Ref IR increase for now. He said there is cross-currents, but there is no danger or warning signal of US economy, and also mentioned US economy is generally positive, but warning for economy downward becomes bigger due to Brexit and US-China trade war, pointing out that world economy started downward about 6 month ago.
“OneCoin” cryptocurrency leader arrested
- Ringleader in NY/NJ area, Konstantin Ignatov was arrested in Los Angeles on March 3, 2019. Also his sister Ruja Ignatove, who found OneCoin in 2014, has been charged with running a cryptocurrency Ponzi scheme.
- Ruja Ignatov and other high-level members of OneCoin team have been accused of laundering $400Mworth of crowdfunded capital.
- Worldwide members are more than 3.5M.
- OneCoin was spread to Korean community in NY/NY area and some of them were well-known community leaders.
Conventional Retail Giants are defeated by Amazon
- While Amazon is winning on-line business, the company is attacking off-line stores as well. Amazon opened a 4 Star store in South Dakota where the merchant prices are about same as on-line price. Buyers do not need to go to other stores. Consequently, many retail stores are affected by it’s off-line presence.
- Payless Shoes, who has 2100 stores, filed bankruptcy last month, according to FT and Gymboree selling children clothing who announced bankruptcy in January will close 900 stores.
- Victoria Secrets will close 53 stores this year, and Sears who closed 150 stores in 2017 will close further 70 stores this year.
- According to Coresite Research, 4800 stores closed or announced to close during first two months of this year and total of 12,000 stores will be closed this year while only 2260 stores will be open.
- According to WSJ, retail vacancy rate has been raised twice around Time Square to 20%.
- Amazon is operating 4 Star stores, Pop-up stores, Amazon books, and they will increase 10 Amazon go to 3000 stores by 2021.
Tech News : Tesla cancelled on-line sale only plan and announced to raise retail price by 3%.