Developers going back to the bank.
From the June issue: Potential buyers are musing about why — in light of the new market landscape — some developers of new condo developments haven't dropped their prices. "Seems like [Williamsburg condo development] 80 Metropolitan is another building that's stubbornly clinging to the pricing they set before things dropped," wrote one poster on the real estate Web site StreetEasy. What incredulous buyers often don't realize is that across-the-board price cuts have not been easy for most developers to make, because price reductions must be cleared with lenders. Yet with price cuts the must-have amenity of the moment, discounts have become increasingly important to the survival of many projects. As a result, sponsors and lenders have recently started coming together to make those cuts happen. Indeed, some formerly obstinate lenders are now loosening their restrictions so developers can reduce prices below previously agreed-upon minimums, known as "release prices."
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|Publication:||The Real Deal|
|Date:||Jun 12, 2009|
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