Calculating Condo Sale Prices

A key component of the financial piece of this project is the sale price of each market-rate condo. To determine the reasonable listing price of each condo, we conducted market research to understand what the average sale price and price per square foot (PPSF) are in Midtown Manhattan. We looked at real estate market reports published by Brown Harris Stevens, Corcoran, and Douglas Elliman.

Due to the pandemic, sale prices of apartments trended downward, with asking prices unlikely to return to 2019 levels in the near future. The graph at the right, reported in Douglas Elliman's 2011-2020 Manhattan Decade Sales report, depicts the declining trend in average PPSF. At the completion of this project, it’s possible the market will have improved, but for this proposal we will use conservative estimates. Because the reports contained different sets of properties, there was a range in the condo sale prices and PPSF, even within the same neighborhood. We averaged the final data gathered to roughly estimate the average sale price for one- and two-bedroom apartments in Midtown, as well as the PPSF in the neighborhood.

Other factors that need to be considered when pricing a condo are amenities, location, and square footage. Apartments in this project will average 1,000 square feet, slightly larger than some of the apartments currently on the market in Midtown. Additionally, while the building itself is not new construction, the apartments will be brand new. These two features will allow for a listing price slightly higher than the average calculated. In order to ensure a high occupancy rate, this project should offer competitive pricing that will still contribute towards financial solvency of the completed project.