Condo plans collapse.

Byline: Sarah Ryley

During the boom years, developers drew up plans for luxury condominiums across the city at a frenetic pace. Since then, many of those condos have hit troubled waters as a result of the financial crisis, as well as lawsuits, over-saturation of product and an inability to sell or even begin construction, leaving gaping holes at their sites.

To find out what happened, The Real Deal surveyed 57 of these troubled projects in Manhattan, Brooklyn and Queens, comprising roughly 26,500 units. The Real Deal's report, Developers' best-laid plans stymied by recession details the latest status of these developments.

Some developments were able to switch gears quickly and are now successful rentals, like 133 Water Street in Dumbo, or have been reincarnated as other projects, like student housing or a youth hostel. Others, including Forest City Ratner's Atlantic Yards in Brooklyn, Sheldon Solow's East River project, and Swig Equities' 25 Broad and Sheffield57, face more uncertain futures because of lawsuits and financing woes.

Large projects in neighborhoods like Harlem, the Financial District, Williamsburg and Downtown Brooklyn, where developers envisioned creating a brand-new luxury market rather than adding to a pre-existing one, will have the toughest time, predicted Jonathan Miller, president of appraisal firm Miller Samuel. "What you have is a lot of condos that are not going to be absorbed in the time frame they need to be to comply with the terms of the financing, and you're probably going to see a lot of them turned into temporary rentals, flooding the rental market," he said. "Rents are going to be hit in the same way prices are."

While most of the projects surveyed were originally planned as condos, industry analysts are warning the city to brace itself for the fallout from troubled luxury conversions of massive rent-stabilized and rent-controlled complexes to market-rate rentals. The conversions of Savoy Park and Riverton Houses in Harlem, and Stuyvesant Town and Peter Cooper Village on the East Side, comprising 14,257 units, were recently placed on a watch list because they have not been able to pay down debt.

In Canceled condo projects could yield affordable housing, The Real Deal looks at ways for developers to remain a step ahead of the crumbling market.