Subdivided penthouses at new Ritz-Carlton hotel in New York expected to attract buyers from Hong Kong, India

By Cheryl Arcibal

/ SCMP |

August 3, 2021 2:49 PM SGT

Penthouse apartment Ritz Carlton New York

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The penthouses are located on the top floors of the tower on 28th Street and Broadway. Photo: Handout

SINGAPORE (EDGEPROP) - These subdivided flats are unlike any Hongkongers have come across before. They come furnished with custom-designed fit-outs, a suite of Miele appliances, and a luxurious bathroom, among other amenities. And they are serviced by The Ritz Carlton. (See also: Penthouse at Ascentia Sky on the market for $8.28 mil)

In a move that will appeal to overseas investors looking to invest in prime New York real estate and also be able to use it when in town, the American hotel chain is allowing eight penthouses at The Ritz-Carlton Residences, New York, Nomad to be subdivided and leased out by owners. The project launches later this year.

The penthouses, located on the top floors of the 176-metre (580ft) tower on 28th Street and Broadway, will have a provision that locks off portions of the two-bedroom flats and turns the second bedroom into a separate suite. Owners and their families could stay for up to 120 nights per year and elect to have The Ritz-Carlton place their penthouse in the hotel's rental programme when not in use.

"You have a whole secondary suite that has the ability to be locked off," said Nic Bottero, an agent with Erin Boisson Aries Team, an agency part of Christie's International Real Estate in New York. "It becomes a completely independent suite with a mini bar, its own bathroom and wardrobe."

The concept is expected to take-off in the current climate of work-from-anywhere arrangements and migration out of big and high-density cities because of the Covid-19 pandemic. It is expected to attract investors who are looking for accommodation that they can rent out whenever they are away, but still be able to use once they are back.

The project is already attracting potential buyers from Hong Kong, India and the US, who have registered their interest in the project, the agency said.

"Buyers are sick of [flats] that they have to rent out for a year and the tenants get a second-year option, and so when they come back for a holiday, they can't stay in their property. But they very much want to be able to stay in the best residences," said team leader Erin Boisson Aries. "It's giving buyers and owners a much more flexible lifestyle, which we've seen really exponentially grow since [the outbreak of] Covid-19."

The two-bedroom penthouses have a starting price of US$6.6 million ($8.9 million). The subdivided suites could be rented out nightly as hotel suites, at rates that could potentially match the nightly rates of luxury hotels in New York, according to the agency. The development will also have one-bedroom penthouses priced at least US$3.5 million. The units will measure between 911 and 1,848 sq ft. The hotel below has 250 rooms.

The interest from Asian buyers was particularly "enormous", said Adam Zucker, managing director at Erin Boisson Aries. These buyers typically rent out their properties for the full year and "when they come to New York for a day or two, they have to stay in a hotel because their investment is occupied", he added.

The pandemic has largely kept foreign buyers away from branded projects outside their home countries. But once travel restrictions ease, international buyers are likely to come back and buy such branded projects again, said Riyan Itani, head of Savills global residential consultancy.

And the buyers of such residences frequently "demand some own usage in the region of four to eight weeks per annum and then a minimum yield that at least covers the costs of the unit", he added.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2021 South China Morning Post Publishers Ltd. All rights reserved.

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